We are always short term paranoid and long term optimistic when it comes to real estate. One of the reasons we’re optimistic is because we study the worst possible case scenarios when it comes to real estate so that we can prepare for what’s next. On this episode of The Your Life! Your Terms! Show, that’s exactly what we do with Rob Minton from Cleveland and Preston Letts from Chicago who were both running real estate businesses through 2008. You’ll hear what happened to property prices, rents and how they handled the crash. You can find Preston @PrestonLetts on Instagram and Rob Minton over at www.RenegadeMillionaireBlog.com.
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Transcript
Hey everyone, it’s Tom Karadza and I totally messed up on this podcast. Let me explain. I have two guests on this podcast and I didn’t get them to share their story of how they got into the real estate business and it’s a really big part of who they are and how they’re able to share so much. And the reason I didn’t do that is they were here for a bit of an informal mastermind. We invited Preston, let’s from Chicago up here and Rob Minton from Ohio, just outside Cleveland. These are guys that we’ve known for a long time. They’ve both helped us out in different ways in our business. And we used to mastermind all together out in Rob’s office just outside of Cleveland. So it was really cool to kind of host them here and talk about their businesses. We shared about our business and that’s kind of how these mastermind things work.
And we just did an informal podcast with them where I didn’t get them to explain their backstory, so I just want to do that. Now. Rob Minton started a brokerage just outside Cleveland, working with real estate investors almost exclusively. It’s where we got a lot of ideas for how to create and run rock stars. So he’s been a great friend and a mentor too, for us to us for many years. So that is a bit of history. He lives through the real estate kind of upswing. And then the absolute monster crash in 2008 2009 and Preston was also masterminding with us back then in Cleveland as well. And He created his own real estate business in the Chicago area, first from a real estate brokerage point of view. And then he launched a property management company after the real estate crisis and really grew that thing into a monster.
And it was recently bought out. And that’s kind of his backstory. So he has a lot of experience both in helping investors in the Chicago area and then launching and running and growing a really large property management company called let’s property management. So that’s kind of where he gets his real estate information from. And I didn’t get them to explain that. So I wanted you to know that here in the intro in this, on this podcast, I just got them to jump in and talk about that real estate crisis and the reason that we wanted them to talk about that from each of their points of view is it nick and I are both short term, paranoid, longterm optimistic when it comes to real estate. We like to know the worst case scenario but it doesn’t actually frees us. It doesn’t stop us from taking action.
We just like to know the worst case scenario so we can prepare for for it should it ever happen here. And that’s why we got them to both share their, their viewpoints on what happened in 2007 2008 2009 2010 that specific period. Then we go off way on a tangent and start talking about Instagram and social media and then it comes back to real estate at the end. So this is a really kind of informal talk, not to typical origin story when we get started, but I think there’s a lot of great, great information in there as well. And if you are listening to this and you are in the Greater Toronto area and you want some real estate information for yourself, probably the best place to go to that we know of and this is definitely self serving because this is one of our websites is rock star inner circle.com that’s rock star inner circle.com and on that website you can find links to all the books that we’ve put out. You can buy those books on amazon.ca or you can download digital copies of them for free on our website rockstar inner circle.com you can get access to the class that we run, which is a free introductory 90 minute session for new investors or investors who want to learn how we are helping real estate investors all across the GTA in southern Ontario. Here you can get access to blog posts, you can access to videos on that website. So basically everything that we’re putting out as available@rockstarinnercircle.com and with that, let’s get on with the show.
Are you ready to live life on your terms? Is it time? Take charge of business, economy, health and nutrition. It’s the your life, your term show with Tom and Nick Karadza. Are you ready? Let’s go.
Okay, so we are live. Nick, can you hear me okay? No, I just want to make sure you can hear me. So we have Preston [inaudible] in the house here. Who uh, I was going to make some joke in Chicago. He, you guys haven’t had a basketball, a good basketball team in a long time and the bowls, but it doesn’t matter cause they had joined forever. So in just blind and the Blackhawks Stanley cups. No, I know. Save the bears. The bears suck, but we’re not as bad as people in, so we’re good now. No, I’m not really good. I mean here. Okay, let’s see your middle of the pack there. Dee said, hey, we have the Toronto argonauts. She’s good to you then. I guess we have, if we had to kick her last year we would have, we’ve got all along. Do you know what, hold on bikes around the lake in nice and close.
Pull it nice and close. Do you know what the Toronto argonauts are? Yes you do. Oh absolutely. I know the CFL. Come on man. I’m shocked. I think he knows it better than we know. Holy Shit. That’s shown to know. Yep. Um, so and lets us here from Chicago and the reason we know Preston is because of the other gentleman here, Rob Minton from Cleveland, Ohio is here as well. And Rob, we uh, got introduced to when I was going to quit my job and tried to figure out real estate. Rob had started a brokerage in just outside Cleveland that was working with investors and I called nick going, Holy Shit. Some guy is running a broker to actually works with investors and we ran down there and you, you taught us so much stuff over the years and you formed a mastermind group and that’s where we met Preston and we learned a lot from Preston.
So both nick and I have a lot to thank you for you, Rob Minton and you press and let, so thank you guys for being here, but enough with that stuff. We need to get right down to the, to the, to the, to the dirty questions here, which is most Canadian investors want to know during a real estate correction in the US. What did you guys see? So maybe I could get from both your perspectives. I don’t know rob, if you want to go first or pressing, you want to go first, but like what did you see? I think it’s instructive for investing because a lot of investors here believe real estate can never go down because they’ve never seen a correction. So they have no, and some older investors here do believe it can go down and don’t really know what to fully expect. So what did you guys see? You should be, should be, go ahead. I was going to say Robert, Robert, make sure that rob is going to make everybody cry and tap
out right now. Um, well, I definitely need to be prepared for any potential outcome because you, you don’t know, you don’t have control over the real estate market. So just keep that in mind. I’m sure Tom and nick, you know, working on that with you guys. Um, but the thing that I guess the most important thing, rather than many people listening to this don’t know us at all. You’re going right across Canada on this pile. I just want you to know that, well, what happens in a crash is that demand completely disappears for home purchases. So, so try to picture what a market would be like with node buyer demand whatsoever for real estate. So no buyer demand means that the prices drop and they could drop significantly and it has a massive ripple effect, many different levels. Uh, but on the flip side, at least in the Cleveland, Ohio area, uh, we had very strong rental demand because people were moving out of their homes.
If they were letting their homes go into foreclosure that they needed, they, all these people became tenants. So the demand for rental properties increased even though the value of those properties had decreased, so there was a positive that went along with the negative and so investors who, what about straight up? So rental demand increased and what about investors who own properties? How did they, the ones who held onto the properties, it was because rent stayed solid and they could just make, you know they could get by even though the property values dropped because w how far did property values come down? 50 to 70% 50 to 70% but could they hold their properties because of the rent stayed solid? They could if they had a longterm perspective. The problem is if you have $150,000 mortgage and the property is now worth 50 you feel like you’re, you’re, you’re in debt an extra hundred thousand because your value’s gone. Got It. I never thought about it from that point. The longterm perspective. Longterm perspective because of your short term, you’re like, screw it. You’re selling this thing. I’m done. You’re out like that. Yeah, you’re out. Yeah. What about in Chicago? Did the property values go down that to that level as well? You
know, for us it was really dependent on the area. Uh, but yeah, we saw the same thing and we’re still in some areas. Yeah, I have some property unfortunately that unfortunately have a longterm perspective that, you know, I’m still below value wise where I purchased them. Uh, you know, back in Oh eight oh nine, but we saw that, we definitely saw that. We did see a little bit of a decrease in, in, in what our rent prices and rent, what the rent was at the time, maybe 20% the most. So we did see, you know, some owners were, you know, they were cash flowing and then they got real close to, to, to break even or negative. Um, and then second to kind of rob, we did see an increase in rental demand, but we also saw along with that we did see a higher a default rate where more of our tenants, tenants that we would screen and you know, have, you know, very high, um, you know, success.
We saw higher, you know, higher likelihood that they were going to default. Not significantly, but definitely in what kind of properties where those, I’m serious. Uh, it was really, you know, I, I’d say anything that it was more in the apartment side. Yeah. Okay. Definitely in the lower income where our job market really tightened up, we went into a pretty high um, unemployment rate. And so if you’re, you know, we’re renting properties that were in the, you know, in the apartment side, 700 to let’s say 1200 in the Chicago market in that tenant lost their job. That’s probably a 30 to $50,000 a year income person there. You know, the number of jobs out there for them, you know? Yeah. Just wasn’t there. Got It.
Yeah. You guys have lived through a lot. That’s a, that’s a rough stretch, man. Police. Well, the crazy part being out now this far from it is that the investors who held and had that long term perspective, they, their property, the values came back slowly but surely didn’t rebound like the quickly like the stock market. But you know, by now the values are probably back to where they were. So you know, it was very you, it’s just a big difference between those who tapped out and walked away from everything, have nothing. And those investors who stayed are, or where they were before and now their mortgages are paid down 10 years, they’re in a completely about her position because they stayed with that long term perspective.
So hard for the, the emotion we were talking about this before, the emotional aspect of like, I can’t, you know, that that’s the tough side of it. But some of them were like, they were walking away like it was strategic defaults. Right? Some of them purposely we’re, we’re leaving because, and then, uh, how did that work? Like for anyone that hadn’t heard that, like how did that work?
Yeah. Well you, you pick if you, depending on how you have your assets, how you’re holding them, if you have them in different entities or if you’re doing some asset planning, it gives you the ability to be somewhat strategic. If you want to let, if you want to, if you have a bad property, so to speak, you could just let that particular property go and try to keep the other properties. But what ends up happening is once you make the decision to do a strategic default, meaning you’re going to stop making payments on your mortgage, like you’re choosing to, your choosing the ability to, but you’re choosing shooting too. So a lot of investors chose, they stop making payments, they kept continue to collect rent, just recover
some of their laws. Right. At present. You saw this too. Oh yeah. Really. Okay. Okay. And then they would play the game trying to delay the foreclosure as long as possible. They cash flow just went through the roof. Yeah. It became very profitable for them. But, but, but the flip side is that their credit score is now they’re done. Credit wise, he can’t borrow another, Oh God, it 10 years later you still can’t blow. Like, so if you do that and let you know of five, 10 years, you still can’t borrow. Well, it’s, it’s like what is it, seven years from a foreclosure and, okay, so something like that. So 70 or so, but, but that’s, so that’s, that was, that was like, I guess like it wasn’t uncommon. I think it was common, relatively calm because it was taking a while for the banks to get around to try to repossess these properties. Right. So for how long, like a year, two years were able to just kind of collect this friend and not paying any more.
It could have been longer than that. I know a foreclosures that took up to three, sometimes four years. If somebody who was actively fighting it, then they could have delayed it. You know, our whole court system was just so overloaded with just such a mass volume that we saw some crazy, you know, timeframes for some of our clients. I, you know, I was in property management at the time and I dealt with a lot of the tenants that would come to us crying because you know, the sheriffs show up on their door and was getting ready to evict them. And here for the last three years, the owner has been collecting rent and that side of it, you’re right.
Didn’t think about that side of it at all. It’s been paying rent, the investors taking their rent but not paying. It’s like what happened to us with our, our last office in Burlington, we were subleasing of someone. That’s the same thing that happened. The security guard shot. That’s brutal situations. Then some investors that would do that, others would, would, if they could tell it was getting a little closer, they would give them a 90 day notice and say, hey, you need to find, you know, terminate the lease, find another. Okay, heads up you about to lose this house. You better move on and then you take the next couple of months for free to move. Um, but how you handled it, a lot of investors actually profitted once they made that decision to do a strategic default, if you were smart about it, you could recoup some of your losses by how you, how you played the game because you got the cash flow for a few years.
Or did some people negotiate with the bank and get these properties back afterwards? Yeah, there was all kinds. All kinds of stuff. There’s always opportunity in some way, shape or form. You have to change how you see it, but was the biggest thing you’re saying though? I never really thought of it. It’s if you don’t have the longterm perspective and you see a property value, you’re just strolling. Forget this. So you the longterm perspective is everything. That’s what you guys were talking about last night? No, those are all the value is, I mean that’s the only way you’re guaranteed to win. If you have a short term perspective, you, your, your risk is inflated. Astronomics [inaudible] asset. Really. It’s not just a real estate thing. It’s anywhere, right? Look at the markets. Stock markets will look, you buy Uber stock, whatever last week or two weeks ago after the IPO and it’s dropped right now.
I didn’t know what’s gonna happen in an Uber, but they only way now is if you sell now you’re guaranteed to lose if it ends up being a profitable company, which is I guess up for debate because a Silicon Valley company, a lot of them decide that profit isn’t a thing thereafter. Um, but uh, but it’s the only way you can, you can make it work. Yeah. I mean it’s the one advantage that you can, you can actually control is your, your lying. If you have a launch for a short term perspective, you increase your odds of success dramatically. So how has this affected you guys, this guy now? Like would you guys ever do like a flip in real estate short term that maybe was going to take you a year, you buy a property in fee, and I’m not saying either of you are doing this, but would you even mentally consider that because right in the middle of that year, maybe there’s another correction and then you’re caught holding this, this property.
Would you guys ever do something like that or no? Are you like past it and you’re like, okay, I’m good. I can, no, you know what I, what I would say is it puts me, I’m much more conservative now than I was then and you know, and really in everything I do in a lot of that goes back to, you know, going through the crash, I would do it, but I would underwrite it with, hey, if I’m gonna do this and here’s the worst case situation, can I live with that? And you know, is this, could this turn into a potential rental? You know, what are, what are my, you know, what’s your worst case exactly. What are my exit strategies? What’s my, what’s my safety net in the event that something goes wrong and do a lot of analysis and pass on a lot of really good deals because it’s, Eh, you know what, I don’t really want to take that much risk right now.
I feel like to give perspective, we should give everyone an idea of what Preston, like you’re, you were property managing as you still involved in the company, but there is a property management company you had had how many units under co like you were managing. So we were about 850 properties and we were managing actually still are about 1400 units. Yeah. So just to give everyone an idea of just some perspective on, you know, there’s a lot of knowledge and experience that you’re seeing over the years when you’re managing that amount of real estate in the Chicago area. And a lot of crazy stories that I mentioned to, Oh that means you’d be amazed at the stories and we, you know, we go into, you know, we go on everything, we’re unique. We manage everything from a $500 a month studio, maybe 400 450 in Chicago in a very rough neighborhood to a two bedroom, two bath in Trump tower for $10,000 a month and everything in between.
So we see Trump tower $10,000 a month, easier to manage than the $400 a month for 5100% actually, you’d be surprised if those tenants are little some, yeah, like a tiger in my parents. I mean our parents had a high end home that they were renting out because the market crashed here a while ago and those tenants were, they weren’t ideal tendency even at that level. Right. And then we, they had found out that there was a history of a repeated pattern that they had done the same thing to other other people as well. So it doesn’t matter, just, you know, the price point doesn’t really necessarily matter. Like. Exactly. And just for some more context person, I don’t know if you know this, I think rob knows this. Our family almost went bankrupt here in this country in 1990 because there was a massive real estate correction.
Huge one. Kind of like what you guys went on a national level, but it was, it was isolated more to the Toronto area and we almost lost, our father was flipping properties and this one went from $750,000 down to four 15, four months. Oh my God. We almost lost $750,000 29 years ago. So you can imagine, right? It was like 4,400 square feet, three car garage. And uh, it’s shaped our futures because nick and I even getting into this business in the back of our minds, we’re like kinda how you’re more conservative. A lot of investors, I remember early on with rock stars, some people would come to us and said, tell us, you guys just don’t have the wealth mindset because you can become a millionaire overnight by flipping these three properties. And we’re like, guys, no. Like you can there, there’s high risk, high reward, definitely.
But are you willing to take that risk? And from our mindset, seeing what our friends in the u s went through and from our own family in 1990 we just see much risk in what you’re talking about. So it’s always kind of held us to the starter homes in good communities, like good homes in good areas, thing and it’s free. It’s given us like a little bit of a, of a bias, but it’s the longterm perspective seems to win. So yeah. Yeah. So uh, nick, I don’t know, I maybe have beat that one up a little bit, but I was interested in kind of the u s things, but I think mentally you guys are past it now, right? Is it still rob Hubba you pressing? I don’t think rob [inaudible]. Rob. Well, if Cleveland went down, I have no sympathy. Cleveland. Okay. They kicked off the rafters.
How many times in the playoffs when we’re done? We don’t care. We don’t have any more. Mr Lebron left. No. Yeah, but no one in Toronto has any sympathy for Cleveland. Man. Lebron smashed our faces and year after year after Chug a beer during a game or something. Do I need to do that? Yeah, that was recently. Yeah, yeah, yeah, yeah. Geez, what a, well, we have the Browns, so we’ve had a rough couple of years. That’s fair. But you must see investors now in 2019 buying properties and 10 years ago they weren’t even investing, so they have no clue. Waveland no clue. Right? Nyclu yeah. And Are you going to go back into, yeah, we were talking about this. Are you going to start helping people again buy properties on the record now? There’s the potential. I like the way Preston’s looking over around right now.
What’s he gonna say? Yeah. Is this going to become like a another therapy session for yeah, yeah, yeah, yeah, yeah, yeah. They can’t be, yeah, we were telling Robin. Yeah, we were telling Robert Lunch that a, a lot of people you are, do you have such good job at helping people that people need you to kind of help them in the real estate investing world, whether you know it or not. Um, so then what’s next for you are you, what about your kids? Do you guys both tell your kids to property investing is the way to go? Is that something that you guys believe in or no, I have two daughters and they have zero interest in what I do. They just know that might come to the house. You know, I have a bunch of rental properties and so I tried to just that they just know that money comes to the house.
Yeah. Like what kind of house do you live in while we live in a house where money comes to it. Yeah. They have a hard time to try and describe what I do because I have a bunch of rental properties. So, uh, if I need money I just go to the post office box and pick up some rent checks. I mean it’s, so, but I try to do say, Hey, this property I’ll drive by a pro house. I said, this property paid for this. I try to like connect the dots. But they have unfortunately at this age have zero interest in investing. But you weren’t told a lot of mobile homes. Now we have a right. So, I mean that’s been, and that’s been worthwhile for you to which a lot of people probably don’t understand that. I mean there’s not, I don’t think there’s the same, uh, the same amount of mobile home parks around healing and then it was close. We don’t seem to have that. Yeah, we have some, I know we’re going actually to Ohio probably either to see you or maybe to the Kennedy Conference one time when we were driving through an ag or we drove through off right off the highway, there was a couple of mobile home parks where I go, yeah, I wonder how we could make that work similar to the, you know, the way you’ve been doing it. Right. And you offer those on a rent to own to people.
And that’s been, that’s been working for a pretty, what that is, is that that’s the primary focus over single family stuff. Correct. Whether they read the return on investments much higher. Yeah. And another benefit is that you can typically just buy those for cash. You don’t need any financing whatsoever. So you, so if you’re more conservative, like Preston and I are from the crash, any opportunity we can create cashflow with that debt is one we’re going to be interested in. It was an example of the numbers so people can just, just a general ballpark. Uh, so you know, with, with manufactured homes, the opportunity is there because someone who’s trying to sell the home, it’s very hard for them to sell it because lenders don’t want to loan money on an older manufactured home. So that actually brings the price of those properties down cause there’s really no demand.
So that means you can come in and pay cash for the property, um, at a very attractive price point. And then you can offer it for sale on a rent to own or with financing. And um, so you might pay eight to 10,000 for a home and then you sell it for $300 a month for six, seven years. And then the person, they’re responsible for maintenance and repairs and taxes and you’re just kind of become the bank and helping them buy the home because lenders won’t do that. So you can see you’re buying it and in three years you’re getting fully paid back what you bought the usually at two years. That’s a really nice model. Without debt, there’s zero leverage. So if you buy this in cash within two to three years, you get all your investment back and then it’s two to $300 a month, every month going forward.
Free cash flow, free cash flow. And then if the person moves out of the home for whatever reason, it’s a massive wind because you get to resell it again and start the payments back at month one and collect another six or seven years of, of payments on a particular product if they damage one at like if they, they, they kind of like, you know, if it turns into a meth lab, how much do you have to, um, uh, you know, what’s the cost to renovate one of those things? Like a few thousand bucks or 1500 to 2000 US dollars. And you get that back from, yeah. So I mean, are you laughing at the u s dollar 150 grand? Can you guys slipped in a Canadian, laughed at the Canadian dollar precedent right away. Had a reaction to that. And he wasn’t even speeding. Yeah. Canadian dollar slash except when they found out that we’re not paying for prescriptions anymore, all of a sudden they got their free healthcare.
Um, so, so then if they’re doing that in a nine, you get it paid off in two to three years. The next six years on that program, it’s free cash flow. If they complete the payments, then they own the home. Correct. But you’ve gotten six years of basically cashflow. Correct. And you’re on, you’re on to the next thing and within two years you take your original investment back and roll it into another property. Exactly. Yeah. Yeah. Okay. So you’ve hit the holy grail on that kind of stuff. Those numbers are, I, you know, it’s crazy. It’s just the cost, like the cost of property and I, and I’m not talking about the manufactured homes, even like just because of the costs of properties are lower in those areas. The cost of living is lower and you get numbers like that. It’s it, it changes, it’s changes life pretty quick.
Well, those dynamics, the numbers won’t be the same, but the profit opportunity will be the same in any area. It’s just simply because of how the market is for manufactured homes and there’s not financing available, which brings the price point down. So any asset you can buy for pennies for below its value, you’re already putting yourself in a position to make attractive cash flow on it. But there’s you, there’s like a rental fee in the park or something, right? Like who pays that? The person that I put into my home. So I do a rent to own program that rent to own buyer signs, a lease with the park and pays the park. The monthly, how much should they be like roughly? I know it will depend on the park, but like in a ballpark, what does someone pay for that type of thing. So they’ll pay a monthly lot rent of around 303 20 and then they usually have a payment on the home itself for 300 so for $600 a month or six 50 a month buying a home, which they probably wouldn’t have ever been able to do otherwise because no loans available.
So, and they’ll have the home paid off and like it’s like a car almost, right. So they now have a home paid off in six years or whatever, five, six years. And um, it’s actually a very good option for them and that’s why the whole thing makes sense cause it’s a win win across the board. Yeah. I don’t know if they’re, I don’t know if that aren’t their mobile home parks are these manufactured homes you called? The manufacturer told him. So I call them mobile homes. You call them? Well you guys have your funky accent, but it’s manufacturers in manufactured homes. Okay. It’s manufactured homes. There are, I remember even in Mississauga there was that one that was that one way. I don’t know how many there are. I don’t, I just not to space. I’ve ever really looked into, but I know they exist.
You have to, you know, the crazy part is, is until you look for them, you, you’re not paying attention to them. So if you start to look for them, you might be surprised. Oh my gosh. And how were you able to buy so many of these things? People, you’re finding them just people are selling them. Uh, well what happens is it compounds, right? So you buy it. If you try to make a goal to buy one a month or whatever your goal is, at some point in time, we’re going to see or buying one a month, nevermind one property a year, finding 1:00 AM on pleading with, please give me your bargain among, no, but so you think about it. So at 10 months you’ve got 10 of these homes, you’re now generating $3,000 a month of cash flow. You have zero debt service. So now you’re almost the point, depending on what you’re buying, you can buy it funds itself so that you can buy one new property ever every month.
So you’re, you can get that money reinvested so quickly versus investing out of your pocket if you had no, got it. Got It. Yeah. You’ve been doing that for about 10 years now or more? Yeah, a long time. So over time you can build a very large portfolio of these assets. Got It. Would you ever go back into single family home, regular residential stuff outside Cleveland? Uh, yeah, definitely. Yeah. Like if these mobile homes are like this, why it goes back to the longterm perspective, right? I mean a single family home, you’re buying a potentially a legacy asset. Yeah. Okay. A manufactured home. They do have a short lifespan man. Okay. Yeah. I mean you can went home, gets run down or a meth lab or whatever to say you can read, you can read of visions of breaking bad.
I think it’s a good book, but this is positive. We could have like breaking bad where you could rebuild the home. You know what I’m saying? So that’s why, even though it’s 30 years old, but I can put a new furnace, you know, the manufactured home kind of, it’s harder to just keep it up for long term. It’s great for cash flow, but long term then the tenant profile has gotta be different say right. I mean the, and the difference with a single family. So the tenant profile and you own a piece of land with the single family stuff like [inaudible] the tenant profile, really your use the same metrics as you would on a single. You want to, you know, do they have stable income, have they been evicted? All the normal things you would look for. You do the same thing. And then in a manufactured home, can you have on a rent to own?
So did they have a lease with you that you can you can you evict them easily? You Dad, I have a lease agreement and a sales agreement so then I can evict on the lease agreement if I need to. Because in Ohio, are you using some state laws to evict? How does it work in Ohio? In Ohio? Uh, no, it’s the typical real estate laws. Tenant landlord laws. Yeah. Okay. All right. Here we have like a tenancy act and we have to kind of abide by the tenancy acts. Sounds like you have something similar that you have to follow. Normal protocols. Okay. You have to put a three day notice on the door. The normal stuff you would do a three day notice. Notice it’s 14, then we’ve got to go. And that’s why like [inaudible] man, your fishes, we don’t let you didn’t think about Chicago. Chicago is more, oh Chicago is more Canadian. Okay. That’s the process of Chicago. So if someone doesn’t pay rent, how’d you get him up?
So we do a five day notice and that the, you know, at five days,
well you really, when you have three days to five days while you read,
not that different, that the difference really comes in and, and, and it’s mainly, you know, one of the, you know, county is, um, you know, then you file for, you know, then you go and file forcible entry and then, uh, that’ll take 14 to 21 days to get a court date. And if you can’t get serviced and it can be extended to talk about two months. Yeah. Well, long story short, the other challenge though is, is our, uh, our counties will allow for a jury trial. So at 10, it could walk in and go, I want a jury trial,
a jewelry trial for eviction. Yes. Yes. With jurors is going to be like a video game, like grabbing a jury trial for an eviction on rents that’s documented on a lease. That’s crazy. I did.
And they don’t have to have a reason. They all they have to do as requested and what happens to people, but it’s a trial and they’re, you know, they’re, the landlord is put on trial. Yeah. Well it’s, I mean it’s, it’s, you know, the, the, the landlord is the, uh, the plaintiff and the, so there, you know, it’s really, uh, you know, it’s a trial on the facts of did the tenant pay or not in the tenant is obviously going to try to say they, you know, there was something wrong with the property. Really what they do is they do it to drag out because you know that you get to that point and then you ask for a jury trial. That’s
another 30, 60 days. Exactly. But out of all the evictions that you’ve done, because you’ve managed a lot of properties and have all the eviction, what percentage of them would you estimate that went to jury trial?
Oh, it’s a real small percentage. And really what it is, is it tends to be that are professional
tenants. Yeah, exactly. Yeah. Yeah. Can you do that in Ohio to a jury trial? No, thank goodness. Yeah. That’s great. Can you imagine? Just think how much time and energy is put into that trial, not just the judge and the representatives and the tenant landlord, but the jury people like having to leave work to be on the jury for this thing, that crazy party. Some of these tenants who are professional tennis would be awesome business owners, the same effort and putting into some business. Absolutely. It would be amazing business owners. Uh, press, I forget, maybe you guys talked about it last night when I wasn’t there. Do you have kids? I do. Do you talk to them about money and like how old are they have at 17, 16 and four. I thought you were going to say I have 17 kids. 17, 16 and 14.
Okay. And do you, I dunno, do you kind of, does this subject come up? Do you talk to them about cash? You talked them about properties at all? I mean, I, I talked to, I try to be as open as I can about, you know, financial, our finances, uh, you know, uh, what I do, you know, real estate, et cetera. There’s one of those things where I feel like kids today, especially, you know, my kids are very similar to Rob’s. There’s not really any interest in that does exactly. The only thing they know is they don’t want to be a property manager. Got It. As patch come to your house, like it comes to Rob’s house. No, no. Do you surf Instagram with your kids together and you compare things? We will sit next to each other and look at each other up here. I don’t know if you guys know this in Canada, Instagram took away.
Not all accounts. You can see how many likes that your posts get. There’s a trial that’s painted. Yeah, that’s right. I saw it up here. It’s live right now. So on the rock star in her circle, um, Instagram account. Now you don’t see how many people like to pose to your friends’ names and then as soon as, and others. Yeah. That’s having a big debate about this in the office yesterday cause I thought this is pure bullshit because these companies are going to Congress in the US and they’re saying, you know we, a lot of kids have like self esteem issues because when they post they don’t maybe get a lot of likes and some other people do but they’re not doing it for that. I was arguing with this about the somebody just yesterday. I’m like, they’re totally not doing it for that. That’s the cover story.
They’re doing it because if you don’t see how and he likes that other people get it, you’re more willing to do stuff yourself. You’re more willing to post on the platform because you’re not so scared that everyone’s going to see that your post quote unquote only got 10 likes when your buddy got like 50 likes. I think it serves two purposes because cause there’s lots of only serves that purpose, but there’s lawsuits for me against them so they can say now, do you know what I mean? Like they’ve been trying to address the issues, but there are lawsuits now forming class action against social media companies because they’ve, they’ve not only social media companies knew about the, the, the, the, um, yeah, the negative effects is having kids. No, but here’s my point though. If this wasn’t positive for their business, they wouldn’t even try this experiment.
They’re only trying this experiment to see if there’s more engagement. Because if you have no a hundred people posting because no one’s, you know, instead of like just 10, cause you’re not worried about it, you’re not worried about how many likes you get probably is on the back end. You can still see your legs. So maybe you don’t care because you’re just thinking you can’t. Yeah, like your own posts. You can still see it, but I guess you’re not worried because if I post something and three people like it, well no one else is gonna really know that it’s only three. Right. Do you guys realize we’re talking about Instagram, like, yeah, I know, I know. It’s ridiculous. No, I know Rob’s not on social. You’re not on social media at all. No, not even Facebook. It’s a massive district. No, he is ag a hermit. Rob And rob actually has some really good insights. Rob You. So what do you think, where do people spend most of their time incorrectly?
An unimportant thing. And how do they know about what are those unimportant things? Well, will it matter in three years, five years, if it doesn’t matter in three or five years and it’s unimportant.
So if somebody, yeah, I see what you’re saying. So like, you know, this Instagram thing, that was a matter of fact in, yeah.
So we work to live, right? We don’t live to work. So, you know, I enjoy certain things. So some people may say, well, that’s a distraction. That’s unimportant. So where do you draw that line where you say, okay, well, you know, we’re all here. We’re all working. I mean, I enjoy what I do sometimes. Um, as a property manager, um, I love the business. I love real estate, but you know, justified all the way you want. We know how tough that, at the end of the day, I’m there for a selfish reason. I want it. I need money to feed my family and to live the life and lifestyle that I want. So where do you draw the line of, of you know, of what’s unimportant and
do you ever regret spending time on Instagram? No,
but I see Preston’s, no, no, no, no. But no in Defensive Preston, I see where it’s points. Is that, are you using it like a break like it out? Like you’re just totally, yes. Yeah. I think his point is, hey man, he works really hard every once in a while through the day. If he’s not going to look at the newspaper, he can choose to look at Instagram.
I’m not arguing with that, but I’m like, so tell me you had dinner, your wife’s there. She’s on her phone. She’s not, we don’t do that. No, no, we don’t do that. And you’re sitting and the same college due at nine or 10 o’clock they’re like, oh my God, I just wasted another night looking at stupid shit. I mean that’s other way about TV, but not about Instagram. But that’s happening right across northern Canada and the U s for sure. Well, that’s my point is, is like how many nights do I want to spend looking at all this fake stuff on my phone? Like isn’t there more to life than that? That’s my perspective. I understand what you’re saying. It’s like, Hey, it’s my downtime. I don’t have to think about it. I get a laugh or two. But yeah.
Yeah. I think it’s unique to everyone and, but I think to be fair pleat people can, there can be a positive to social media because there is a positive, right? Sincere, there is some positive, but with the positive you got to acknowledge the negative two. And if you can control the negative and focus on the positive, then maybe it’s worthwhile. But for, I think for a lot of people the negative just really overruns the positive and, and it, to your point, it just becomes like, well then you know, for the negatives outweighing the positive, then I don’t know, to me it’s a negative. It’s not in between. It’s like I, it’s actually a negative. There’s no in between. It’s either bad or good. If the bad over ways to good, it’s bad. Right. So Robin, I’m curious, how do you catch yourself when we all have our bad habits?
You’re like, Huh, I got to break that. Do you do something? We were like, oh, I shouldn’t be thinking this way or shouldn’t be doing this. Do you have anything to kind of break you out of a little cycle? I just try to replace it with something better. You know, instead of sitting on social media, maybe grabbing a book. I mean it’s doing something where there’s maybe some value there that you can use or leverage going forward. Maybe you can through social media, but for me it’s just trying to just upgrade that action slightly. I don’t think there’s much you can get for. What about the people? So like as you say that, I actually don’t agree with this, but I just want to play devil’s advocate for a second. So what about the people that say, okay, well look, so you’re sitting on the couch and you know your wife or you’re going through social media, go through Instagram and you’re looking at stuff, but instead of that, you’re gonna grab a book and I get to sit on the same couch and you’re not going to actually be talking to your wife because you’re sitting there reading a book.
So isn’t it the same thing? Yeah, that’s a good point. But I think Rob’s point is you’re feeding your mind with some good information. So there’s some nonsense. I kind of agree with that. I’ve just, like I said, I’m playing devil’s advocate here, why everyone in this room has turned books in the money, right? So how can you argue with reading a book that you’re going to take something from and turn it into money or cash flow? So I, I’m not on Instagram. I haven’t turned anything from Instagram and the money, but a book is much better in, at least for me, if my time, so yeah, I shared last night with these guys that I took myself off Instagram. I don’t really check anything about it. I don’t know how many months ago now, four or five months. And for me personally, I’m not saying it’s the right answer for everyone, but for me personally, I’m, I feel just in a better state of mind because of it, because I just found that sometimes I would go down a rabbit hole and I look at some funny videos and then there was a couple people I followed and I felt like I got some value from because I’m like, oh, I just like to see what they’re up to.
So you know, there was some positive there, but for some reason, for whatever reason, it was when I got, when I spent the time on Instagram and I was looking at stuff, by the time I got off it, I noticed for me, my state of mind and my kind of Itch, it’s shifted and I wasn’t kind of who I was before and I didn’t like it. And now that I’m not doing that, I find overall it’s better because I was primarily doing that a little bit in the evening at home and I just, it was just for me, you know, the way that things are structured in my life, it was a bad habit and I’m better for, I feel like I’m better off not doing it, you know, I’m not saying it’s the right answer for everyone, but for me it’s definitely, it’s definitely a better, so I’m off, I completely think about our kids.
So if you’re feeling that our kids are feeling that too, and how do they escape that? That’s, that’s the question. So that’s an interesting thing cause I don’t understand with our kids growing up and I’m sure pressing your kids are kind of audience grant brought up your, your kids are probably on Instagram. They’re growing up with this. I find they handle it so much better than, than the way Nick’s describing or the way we do. No. Cause what I, when I see, when I questioned my son about it, I’m like to him I’m like, you know, ah, all these likes or all this nonsense. He’s like, yeah, whatever. He it, it doesn’t seem to be affecting daughters. Um, and you know, it’s hard. They, it’s like your neighbor gets a new car and you’re like, aw damn, I just, I should get in my car.
So okay. So now you’re on Instagram and your friend is doing something and you’re not included in that and your nice night just kind of went down the drain because you feel inferior. I guess my point is if you’re growing up, if that’s your normal that since you were a kid, you just kind of always see that is does it even ruin your night? Whereas it just normal, I guess we won’t know for five cause I’m just wondering, it’s like remember when we were kids, like our mom who’s sitting right next door here said stop playing video games because you’re going to, I don’t know what she said. Maybe I was going to go crazy or something. And don’t sit so close to the TV playing video games because it’s going to be bad for your eyesight. I’m 46. My eye sight is perfect. And I sat in front of Nintendo.
You know how much Super Mario I played Nhl. You know how much you know NHL? I played like for the tea. Oh yeah, all of it. I was on my Vic 20 playing golf. Do you remember golf? Yeah. My only thought my golf, I don’t really remember what that was like way back [inaudible] I’m a bit of a geek too, man. I played, I could program, I created some games and like basic, my, uh, my only thought on that is it’s like, you know, I equate it to like people’s Diet or exercise, right? They’re like, I don’t know. I feel pretty good. Like I don’t, I don’t need to kind of look into that. And then all of a sudden they change their diet to be better and they start exercising and the, and then all of a sudden they feel much better. And then if they changed the Diet back to what they were doing, they’re like, wow, I feel like crap.
So they, it’s almost like you don’t know what you don’t know. Right. So, and I don’t know if that’s accurate, but that’s the way I look at it. So it’s like before you kind of change some of this stuff, you’re like, nick, I don’t know what you’re talking about. Like I feel good. And then when you change it, you’re like, wow, like I actually feel much better now when I go back to the old ways, I don’t feel nearly as good. So I just wonder if there is a little bit of that. So because they’ve grown up with it, they don’t know life without it. And maybe it can be much better, but it’s just never been excused. I don’t know. I’m not saying that that’s, I just, I feel like there might be at least for some of them that that would come into play.
But what the hell do I know? I’ve been to [inaudible] question. So if you are any time you have a down second, if you us or our children, you pick up your phone and you need some type of stimulation, that’s bad. What does that do for you? Your attention span? I noticed my personal attention span and you read a book anymore. Like I found it’s harder for me to sit to, I used to be able to sit down well over an hour into a book. Easy. Now I find minutes. You’re freaking out. Yeah, yeah, yeah, yeah. I think kids, yeah. I’ve, I’ve made a mental and is so it’s amazing how hard it is and I challenge anyone like listening to try to do this. Like you’re standing in line at the grocery store and there’s not one person, there was like four or five people in front of you.
Try to stand there and just look around and not grab your phone and look at something. Do you know flipping hard? It is. Will you tell us? Not only that, notice how everyone else has their phones out in the line now you look like a creepy guy too, by the way, because you’re not on your, well, I do that little test with myself all the time and I ended up just reading all those national enquirer headlines and then the marketer in me starts wanting to write them down cause I’m like, damn, that’s good headline right there. It’s like so and so Megan, who’s the Megan person who had a baby and we’re here and there’s like a good headline about her and the, did you know they named the baby Archie? I love Archie Mann or topics in a way that Archie comics I’ve in my life joke, Carol told me they need to baby Archie on.
Mike. What? Archie? I didn’t like you gotta be hardcore British. She’s really cool. Okay. I don’t want to listen to deal on Netflix if you’re not watching it. Your shirt. I get the plug like this. Try to get this back on track just a little bit. Preston in Chicago right now. If you’re working with an investor who’s like from Toronto, doesn’t know moving to Chicago, but they want to pick up some investments, is there something that you would steer them to an individual? Like would you be going to a single family home suburb in Toronto, a condo south side, while the gangs and drugs, or maybe it’s on the south side of Chicago. Where does, where does all the gangs and drugs sell side? So is that where we hang out? That’s where we go. Good drugs, good drugs. Can we get them an import to again?
Uh, you know, I would, uh, yeah, they’re specific areas. I mean, one of the challenges to our market is, is you really have to know it and if you don’t know it, you can get burned really quickly. Can you get like a cat? Can you get a pro single family homes? I guess? How far would, you don’t have to go out to Chicago to get a single family home to rent to cover its costs? Oh No. I mean you could be, you could be within Chicago and I mean our cap rates are still really good. I mean, we still have eight, nine, 10 caps that we’re seeing on regular single family homes. Oh, absolutely. Absolutely. That’s in a a d like a decent area of Chicago. Yeah. Can you give us price points so we can kind of just visualize this? So I would say, uh, you know, where, where I, I would look to, uh, to, to push individuals is, is really between 75 to like one 75.
We see a lot of good. Um, you know, we see a lot of good gross yields that’ll be in the, we talk a lot of gross yields just, you know, annualized rent divided by the price of the house. We’ll see 13 to 15% very easily. Um, between that 75 to 1 cent, how much are those were anything go for a, they’ll go from 1100 up to 2000. So everyone in Toronto, just everyone listening to this just freaked out because you mean you can buy a house from 75,000 to 150,000 and that’s getting you, what like is that a two bedroom house, a three bedroom house, two to three bedroom driveway up to the side? Yeah, 50 years old, maybe 60 years old. Our housing stocks older. So you know, we have, I mean we have a lot of properties, you know, homes that were built in the early 19 hundreds.
We have some that are late 18 hundreds, uh, to 1950 you know that, that’s kind of where you’re going to see our housing stuff. I’m buying $150,000 home. The neighborhood that, I mean that you’re picturing is what kind of neighborhood? I mean it’s a, I would say it’s a, it’s a blue collar, you know, middleclass area do, do it. Does it need renovations? All of that price point. Like do I have to do work to it before you can rent it out? No, no. I mean, so we’ve got a property under contract right now. It’s, you know, this one’s a little bit lower socioeconomic
area. It’s
under contract for 70, I think 65 and pulling 1350 in rent.
So parking, just parking lots into whatever parking lot about parking spots, like 40 grid in Toronto parking. That’s like 50% of the value of that home as a parking spot in Toronto. I mean, that’s downtown cord. That’s, this is a little bit outside probably the core of the city. Right. But how’s investor demand? Are you, do you have like are Americans in their piling and buying these properties as investment?
You know, what I would say is, is we’re talking about this at lunch where, you know, the, the, you know, investors are really kind of a lot driven by, uh, the meat, you know, medium, what’s going on in the media and what’s really kind of the, the, the taste for, um, investing. And that’s definitely on the rise. I mean, we were starting to really see, I mean, you know, it significantly start to pick up where you’re getting new investors that are coming in. They’re like, Hey, I’ve invested before I wanna I wanna start to look to pick something up.
You know, this is that some people from California are investing in Chicago.
Yeah. So you’re seeing that. We’re seeing a lot of that we’re seeing in a lot of, we get international clients on a regular basis. Um, the Ark, we’re a big metropolitan area. It’s well known. Um, we have some issues with our taxes.
They’re a little expensive. If I want to buy a property for 350,000, what, what kind of property am I looking at then?
Yeah, it’d be, it’d be dependent on the area, but the areas that I would push people to your, you’re looking at, I mean, you, you wouldn’t be able to, we definitely cap out. So that $350,000 home, you know, in areas that I would push people to would, would really probably cap out around to, well, I’d say probably 2,500, maybe 3000 from a rent stamp. Does that make sense? Yeah, yeah, yeah. There’s definitely a, so
that sweet spot is what you’re talking. Exactly. It doesn’t make sense. I don’t know, my math is still makes [inaudible] different worlds. Yeah. Okay. That’s interesting. And then rob out in the, I guess is that the east side of Cleveland? What, what, what kind of price points for single family homes? Can you just paint a picture? Because I don’t think most of us mere, no, I joke about Cleveland, but it’s an amazing area and I don’t think I’d be where I am today financially without the price points being where they are. So, uh, you could buy a single family home, a nice three bedroom, senior single family home for me to 80,000. You could probably run it for 1200 and the Texas aren’t nearly as high as other areas. So the cashflow is very, very attractive in Cleveland and that $80,000 home, is it needing a lot of work?
No. And you know, we’ve been out there looking at those. So that’s like sometimes a two story house even, right? Yeah. Bungalow. Colonial. Yeah. Yeah. Got It. Okay. Driveway up the side garage, maybe at the end of the driveway, kind of. Lots of those on, I forget, is a 30, 40 foot, 40 foot 40 by 120 or something. Yeah. Yeah. Got It. All cookie cutter. Okay. First Time buyer type pay the taxes on that, uh, 1300 a year. That’s really good. Yeah, that’s really good. Yeah. That’s 1300 year is the property tax. So the benefit to Cleveland is that the cash flow is super attractive. The negative is that we don’t have super strong appreciation. Yeah. But if you take the cashflow and reinvested into other assets, you can kind of get the same result. But, um, so we, we don’t, we don’t have both.
You guys have castle and appreciation. We’ve got very attractive cash flow. Our cash, we’ll, we’ve have to get more and more creative to kind of find ways to create the cashflow. But yeah, you can still find it here for sure. But, uh, but I mean that’s kind of like a renewed focus for you, which is kind of cool because you, you have your newsletter that you send out, which is cash flow on air, right? What’s you focus on? All sorts of different strategies around that stuff, which is cool. You’re making people think about those different kind of avenues you can create. Just different income streams for yourself. Well, the one lesson that I learned in the crash is I had a very, I had all these assets and I was a multimillionaire on paper and the crash hit and then I’m no longer multimillionaire. So that taught me, and I think you guys did the same thing, is that you know, if, if you make your focus wealth, you could potentially find yourself in a bad spot because you can’t control wealth and you can’t eat your wealth unless you sell the asset.
So after the crash I was like, okay, I’m going to get back on the horse, but I’m only going to focus specifically on cash flow. And with whatever, whatever appreciation happens, it’s just going to be a bonus. And um, so that metric then I, I’m a, I’m a much better investor now because I’m not distracted by trying to get wealth. Paper, wealth, cash flow gives you freedom because you can quit your job. You know, you can pay your bills, you can put food on the table where wealth, it’s trapped. It’s locked. It’s, it’s so funny you say that because after our family went through the real estate crash of 1990, we thought all about cashflow too. That’s why we’ve been so hard with the cashflow message because we knew cashflow was all, uh, was uh, what it’s all about. It’s an important message. Yeah. And uh, rob, there’s something that just escaped me, but your cash or yeah.
You said something. I, I tried to tell my kids that one of the most important freedom things that I’ve ever learned about in life has been the ability to be a good marketer. If I, if I want to pass anything on to my kids, it’s not even so much about money. It’s like if you understand the marketing and the ability to get a customer in the door of a business, you have pure freedom because you can drop, I feel like you can drop me down anywhere in the, in Chicago precedent with you, Cleveland, with you, rob. Uh, we can go to Croatia anywhere and I know how to get customers to come through the door. And that to me is the ultimate freedom because I can create cashflow from almost thin air with that ability. And that’s part of what I want to kind of share with my kids, like that marketing message.
But I think sometimes people roll their eyes at me like, oh my God, you’re going to talk about marketing. But I feel like it’s one of the best life lessons I can share is that how to understand business from a marketing point of view. Uh, that might sound a little ridiculous, but if you, marketing is the most valuable skill you can ever develop burden on, you feel the same way. [inaudible] you can almost solve any problem in life through marketing. Yeah, I agree. You shared something in one of your emails reef plan, and we’re going to wrap this up, is that, uh, the, a zig
Ziglar quote of how does it go? You can have everything you want in life if you help enough other people get what they want. Yeah. It doesn’t that sum it all up. I completely agree with that. Yeah. I’m a big believer in that. Before, I don’t think I want a number of years ago. I think if you told me that I, I, I, I don’t know if I really kind of agree with that. You know, I always thought there had to be a winner and a loser type, you know, that type of mindset. But I was, I was like, now, based on my experience, clearly wrong, but also if you help people get what they want, you just have such a sense of purpose in life. It’s not empty. It’s just like you’re just doing things for money. It’s like, okay, I have a purpose. I know what I’m doing here.
But there’s just more than enough opportunity for everyone. Right. It’s like, it’s like with us, with our investors, some people come in, they’re like, I don’t get it. Why would you ever do this and help these, you know, all these help us as investors. Why don’t you just take all these properties for themselves? And you guys know, they’re like, look, there’s so many opportunities. Like I can’t, like there’s no way I can actually do all this. Right? And you guys are seeing it. Even, even in the states when you have these big kind of corporate entities coming in, buying tens of thousands of homes, there’s still opportunity for everyone. Like it’s just this endless, right? It’s kind of crazy, but I mean, you can try to go for the money or you can try to go for the email that you guys share with us this morning. Hey, you guys changed my life.
Like what’s more important? You know, that email or the money that will be gone like that. So yeah, no, it’s, it’s quote. I mean if you study it and you think about, look at every successful person, you know, you’ll probably find zigs quote or that his philosophy operating in their life. Do you think so? Yeah. Somewhere I, before we wrap this up, I just want quick opinions on university for your children. Well how are you guys feeling about that? Like as university mandatory for your children. I’m just curious cause my, my kids are both on that path to go finish school and go to college or university. Right. How are you guys feeling about that? For me, I took an, I did this with my daughter so I took her college fund that we were saving for her and we together went out and we bought a single family home with her college money and it’s her home and then the rent from that property is going to pay for her college.
So I’m trying to show her the strategy of how to use real estate or assets to get what you want in life. But yeah, college is important. Um, you don’t want to overpay for it, but it’s certainly important. Does she get that? Like, do you think we’ve done that and does she get it? She certainly gets it because she’s already planning w you know, cause she, when she graduates she can live in the house, she can rent it, she can sell it. She, she’s already like saying that’s my travel fund. So that’s the cash flow from that home will find her wherever she wants to do. What’s her, uh, what’s she taking and she’s a film major. Okay. I just want to disassociate any concept of financial freedom with going to university or college. That’s my biggest thing. Whereas I felt I was sold, I sold a bill of goods.
Like you go to university in your life’s going to be great. Well if you go for it from their perspective like I want to learn and to become a more well rounded person and you want that for your children then yeah, then it makes sense if you’re in it for just, yeah, it’s, you have to look at it differently. Yeah. Cause the, the, the, the world changes no longer have while you go to university and then like your chances of getting a good job or just this one like so much better. It doesn’t really work that because so many people now as of like a, I mean all the entrepreneurs or business owners we talked to, it’s, it’s, they’re just looking for good people and what they’ve gone to school for. Unless you’re looking to be a doctor engineer, like very specific skillset. A lot of the things that are like, yeah I don’t really actually care what you’ve gone to school for. Like are you a good person? Do you have some discipline? Wait, we were talking last night or work ethic and you know, and one of maybe what can you learn, you know, cause you can learn so much in other avenues now it’s kind of change things. What are you telling your kids?
To me it’s, it’s about growth is, it’s just as much about, you know, education’s important. I mean we, you know, you know, people need to continue to be educated through, you know, for the rest of their lives. But for me it’s, it’s about I want my kids to, to continue to grow. Mentally. I want them to persevere because, you know, depending on where they go, I mean it should be tough. Uh, they’re going to be on their own. They’re going to fall down. You know, I want that to happen. But still in an environment where there’s a safety net forum where whether it’s the school itself, whether it’s us, I want that for my kids and I want, I want to see them have to persevere to get through a hard college and to go to and take hard classes and find a way to balance social life.
And you’re almost using it as a resilience. Absolutely. I’m how to, how to battle. I think so few people today have, you know, have the, you know, and I see it, you know, the most successful people I know have, you know, their perseverance is, you know, is, is just tremendous. And I think that’s one of the key traits we kind of discussed this last night at dinner is that’s one of the key traits to success. And I want my kids to learn that. And it’s not taught and it’s, you know, I think it’s something that’s taught at home, but I want to push them into opportunities that’s going to force them to do that. Whether it’s athletics, whether it’s, you know, my daughter rides horses and she has to be there for certain things and has to persevere through cleaning or horse and just doing a lot of, you know, nasty stuff. And I want that for them. I want them to do, you know, deal with struggle because you know, when you get on the other side of that, you know, uh, you know, the real estate crash was a blessing for me. I on the other side of it jumped into a new business I never would’ve gotten into and that struggle and that, you know, that those failures that I had through it, you know, taught me valuable life lessons and, and you know, put me where I am today.
If you bought a horse yet for your daughter. No, we lease a horse. We don’t buy, cause my daughter’s into horseback riding as well. So I’m just wondering what’s coming down the pipe too. I under a horse for one week. Oh, did you? Ain’t nothing. You Buddy. I paid for the horse and then I realized my daughter wasn’t taken care of and I gave it, I gave it away. So it was very expensive in one week, given a chance. I cut my losses so fast. I um, you know, it’s, it’s funny you said that just about, um, them persevering through stuff. So my daughter got a, I guess a couple months ago now. She got bucked. She was doing it for about six months. Uh, the wind came, it seems like the wind came through the searcher couldn’t really figure out exactly what happened with the horse. Bucked her off.
She’s eight. She went over the horse head first, did a flip in the air. Like I was watching this and I’d never like, you just don’t want to see your kid tossed around like a rag doll. She flipped over, landed kind of partly on her head, partly on her shoulder. Luckily there was no head injury, but she broke her collarbone. Um, and, uh, she, she was in rough shape sheet. She handled it really well to the point where cheek debated getting on and just walking around with the horse again. They took around cause they wanted her to get back on the horse, which I can understand. But uh, as soon as she was better, you know what she was back. Um, she was a little bit hesitant take the lesson, but she hopped back on the horse and started going again and a much more calm manner and things like that.
But yeah, I think the lesson there was like value to going through that now. I’d never want to see your break a bone and, and Jesus that, that could have been a very serious injury to the way she felt like, I don’t even want to witness something like that again. But after all said and done, there is a valuable lesson there in, in the perseverance and realizing that like, yeah, you got to fall down, you gotta get your ass back up. You know. I want to wrap this up with the real estate stuff that you guys went through, what would you tell someone who’s hesitant to get into real estate today? Because they think the real estate mark,
it’s going to crash tomorrow. No one will believe this. And I think Preston just said it, but the real estate crash was the best thing that ever happened to me by now. I, it completely changed my thought process. I went from paper wealth, the cashflow, you know, and then I did many strategic defaults on properties. Cause once you do one and your credits blown, there’s no reason not to do more. So once you kind of flip that switch, you can move forward with various strategic defaults. But uh, and then you know, when your credit score is shot, it’s so valuable because now you have to learn to do things without borrowing. And uh, it was very, it was very helpful for me. So I’m thankful for it to be honest. Yeah. Let’s see. You have to get creative on that kind of thing or when you don’t have to become a much better than me. I guess the longterm perspective that you’ve talked about, you now have a longterm perspective.
Preston, what about your yourself? For someone who’s thinking of getting in with, they’re like, oh, I’m scared.
My big thing is, is I truly believe that there’s, there’s two ways to enter the really only two ways to, to, to grow wealth and cash flow in, in this world. And that’s, uh, owning a business or owning real estate. And you know, you, you have to do, you know, in a perfect world you can do both, but you have to do at least one. And, uh, to me it’s, it’s, you can’t predict the future, but you know, you can go in and you know, smartly and invest, you know, invest and invest with a smart strategy. And if you’re investing for cash flow, you’re right and you’ve got a longterm perspective, you’re going to be okay. You know, all of our, you know, I was able to get through a lot of properties by just saying, look, we’re just going to keep fighting and, and yet it’s going to kind of stink.
But, um, at the end of the day, you’re absolutely right. I mean, it was the best thing for me. I so much better an entrepreneur now. I built a business that I never would have done that was really hard. Um, but it made me, you know, it made me a better investor. It made me a better business person. I’m a better father, a better parent, you know, all the things. Uh, because I, you know, I went through some incredibly valuable lessons. I fell, I persevered through it and, uh, and then what it’s done for my confidence just going forward in life and business
has been incredible. Adversity makes you stronger. Absolutely. It’s funny, I feel like you guys went through a lot to hear you guys come up both with positive messages from it. That’s a, that’s a big deal. Uh, Preston, we’re going to take you on this podcast. Um, so for anyone who wants to find press and obviously on Instagram, Instagram, I’m on Instagram at [inaudible]. If you want to sit in a box, apparently just put ads towards Preston on Instagram and then rob, you’re, now that you’re not going to nail it down I think. Okay. Take it back. We’ll edit, we’ll edit. You’re not on social media. So if someone was going to find the cashflow linear program or you are route, is there something you can hand out? Uh, yeah, just kind of my site. There’s plenty of stuff for you. A book, I have a book you can get w which you are cash when eero.com.
Okay. We’ll link to that as well. So if you’re looking to go to Cleveland and start asking around, hey, have you heard of this? Rob [inaudible] who buys manufactured homes? And apparently he buys one a mountain. I’m sure they’re going to be able to find them. So if you’re listening to this and you want links, they will be at Rockstart, inner circle.com forward slash podcast. You can find this episode and we will link out to that. Guys, thank you for doing this. Really appreciate you sharing the story and coming down and visiting and the whole bit. We’ve learned so much from both of you guys, so really, really appreciate [inaudible]. Hey everyone. So hopefully he enjoyed that chat. We did get go all over the place. Um, I think there’s a lot of gems in there and a number of different ways. And if you are listening to this and you want some real estate specific information for Canadians in the Greater Toronto Southern Ontario area, you can get access to all the stuff we’re putting out at rock star, inner circle.com. That’s Rockstar, inner circle.com. That’s it. This for this time and until next time, your life on your terms.