From Sleeping on a Dirt Floor to $80K/Month in Passive Income

this is the BiggerPockets podcast show 761. you have about 34 doors now 34 I think is what you said when you were a kid sleeping on the floor all you wanted was a bed of your own in a house yes how does it feel to achieve what you've achieved it's it's unreal like it's sometimes like this is me what's going on everyone this is David Green your host of the BiggerPockets real estate podcast joined today by that Echo you hear in the background Rob abasolo with an episode that frankly I don't have words for if you don't like to cry you might want to just turn this one off right now because even the toughest person out there is probably going to shed a little tear and be incredibly inspired yeah it's a story of perseverance that yeah I think hit home for me and will hit home for everybody at home what do you think today's guest yamu Kamara is like the poster child for bigger pocket success I mean she built in three years of portfolio that you will be shocked by and she just used the basic techniques we talk about before we get to this interview with yamu which I know you're all going to love and I'm going to ask you ahead of time to please share this podcast with other people even if they're not super into real estate they will be after listening to this I'm going to throw it to Rob for today's quick tip hmm we got a little curveball here they have a little lucky lucky for you and for everyone at home I came prepared and my quick tip is I'm not stalling buy your contractor lunch all right without any further Ado let's get to yamu welcome yamu to the BiggerPockets podcast how are you this morning I'm doing great thank you for having me yes let's jump right into this thing I want to hear about your story so tell me where are you originally from and can you give us an idea how you grew up sure so my name is short I'm from West Africa a small country called The Gambia West Coast it's by senegaf's the little country insights that I got literally so it's about two point something million and the seventh child of my family and yeah I I grew up in that small village I lost my mom when I was two and I lost my dad when I was 11. so I was raised by my elder sister and yeah there's a little background about me so what was it like growing up there most of us have not traveled to the continents of Africa much less where you're from tell us a little bit about what daily life was like yeah so it's more of we live in extended family so when my my dad when my mom passed I was too when my dad passed before my dad passed he was really sick so my sister was forced to get married so she took me with her and my brother my elder brother was like four or five years older than me so I grew up as an orphan in her in-law's house yeah it was hard growing up in an extended family that you don't belong in because usually we live in family so let's say a family member like a husband has maybe four wives or five wives and they have kids so that household is all let's say the last name is green it's like green kundami everybody in the house it's called it's great so you coming in with a different last names like you don't belong there's some activities that you will not participating because you're not a child of that household so it was clear growing up from an emotional standpoint you were a stranger in a sense in the house I mean they knew who you were but you were not welcome with open arms as if you were one of the kids there was preferential treatment you had at a very young age you had to experience a lack of control and the pain that comes from not really having control over the outcome of your own life yes basically so I mean you were thrown into a situation you had very little control so it's like there was a lot of pain uh did you have your own room were you sharing a room with other people what was that like no so as a child just playing with other kids outside and I just wanted to go drink water and there's a meeting about us about me and my brother being returned so I always thought oh so we don't belong here and it really hurts as a child I saw this meme uh on now let's say non-stick the other day and he clicked to me outside this is how I feel it's like you don't know what pain is until you live in somebody's house who doesn't really want you there and I was like that was to me like that was like that clearly explained my life so I wasn't allowed to sleep on the bed so I would lay on the floor and when I say floor I'd be like sand floor not like sip like cement not like carpet or anything so me uh sleeping on the floor my 80 year old nine-year-old girl I would have bed bugs sometimes worms will come and they will touch me and I'll just wake up so my brother made me just touched like so that's like you guys come here and I'll just put used batteries there that night I'll just wake up and I'll kill the veil box on the wall so I guess from there I always I was always obsessed with houses because I never really had my father's house sometimes when I visit for holidays we would not eat sometimes sometimes we eat once a day and sometimes when I go one time it was a rainy season the summer holidays and we would have to get up because the water was coming inside the house that's how poor we were so even though the family that I lived with are not rich still a village but it's up there as a natural where am I it's better than my dad's condition yeah so so yeah yeah so me laying down there as a girl I always like say I'm obsessed with houses so when I see friends whose house after school I like to go to the house system I've always wanted one day I'm gonna get this house when I'm gonna buy a house but how did they buy multiple houses I would just saying just the idea of haunted house Yeah Yeah you mentioned in that Tick Tock well first of all thank you so much AMU for sharing I'm sorry no no no um you mentioned in that Tick Tock that uh when you're not wanted in the home I think that's when you experience the pain right and so yeah I'm wanting to know was that really the moment that that inspiration where you're like I am going to find my own place one day I'm gonna have my own bed um was that sort of the beginning of your your real estate dreams or did it come later on in life yes that's that's that's what that's that's where he started I always knew one day I'm gonna make it and one day I'm gonna buy a home like that was my dream to say one day I also have a home and a bed so I'm like a house of my own would you is that your why is that today your why is like the reason you do all this is basically to to fulfill that dream I have multiple wives what that but that's one of them what else you got I want to know poverty I don't I don't wanna I don't want my child to go through any of those things that I went through ever you know that's something as you were talking yamu that I thought of The Stereotype that wealth and money is the root of all evil the people that say like it's the wealthy people that are the problem and I was thinking about for you growing up in a house I'm sure that the Genesis of why people felt like they didn't want you guys there they talked about you leaving was there was not enough money to go around there was none if you were not eating maybe one time a day they were incredibly financially stressed and so you're a burden in a financial sense you and your brother on this other family and they're thinking from their flesh is what's the easiest way to lighten my own load and the emotional pain that has on someone else's you experience was intense now fast forwarding to where you are now you have 90 units that you own and more under contract you're making eighty thousand dollars a month you've come a long way from sleeping on a floor having to wake up to to kill bed bugs that were looking to crawl into where you were like I know I just kind of give a spoiler alert to everybody listening to this but it is a fantastic story this is like something right out of a comic book like do you know that you're a superhero oh follow me okay well we're gonna find out how you did this right like what happened where I you went from just wanting a bed to owning multiple to pull multiple almost 100 units at this point so let's go back a little bit again we understand that life was challenging in other ways other than just Financial especially as a woman in a male dominated Society can you list some of the things that you were not supposed to accomplish yes so I I this is this is not how the life of a girl from my Village supposed to be I'm the only one that went to college in my Village um for for web growing up but God is supposed to just go to all the way to maybe middle school and then you're supposed to get married for me it was hard for my actors to push on my sister to push for my uncles because the male have more say and no one's live episode when you're getting mad your uncles take care of it so by the time I'm like 60 and 17 they already thinking of arranged marriage they always think of who you're gonna get married to it's already arranged for you so for me for them to even let me to go to high school to college was was a big deal talk less of coming to America by myself and not been married it so by the time I was in high school most of my friends that I grew up they ordered at two kids already married and everything Yama did you have to fight to go to high school was that like a really big battle with sort of I guess your family or your extended family in the household I mean I gotta imagine that probably didn't come easy so oh no I didn't have to find my answers out if I had to go through my enters I don't have the audacity to stand up to my uncles so my angels will sick at least she's smarter school this principal said she's really cool she has a scholarship we're not spending any money just let her go the same thing with Colleen it was like she has a scholarship let her go they banked okay after this we I all they already had the person of Love Get Married Too I already knew who I was gonna get in man since I was a young girl so it's pretty arranged marriage so you I already knew they were like okay she knew she she she's gonna admire this guy when she's done so it was like my I'd go to my auntie my mother's sister um my mother's eldest is the host boss now rest of this but she was excited for me a lot my sister wow yeah so you mentioned that you uh you know obviously your why was the ability to eventually go on and have your own bed and own your home and you said you don't want to go back to poverty and that was a big motivation for you was that the same with school because you mentioned you're very good at school this was something that that you worked hard at did you work hard like with school in your mind your ticket out at that at that moment did you know okay if I if I really crush it in school if I study and I get good grades this could be my ticket out of this life so for me I was like okay if I do so great and every exam on top of my school I will always have scholarships so where I'm from is nepotism for you to get scholarship you have to be have a connection to the government or something I have known of those connections so the only way to get through is to be the best from my school the best out of the outstanding one so I was hoping if we if I can get to that top they would not say oh we don't have money for her to go or we don't have this it would just be oh she has a scholarship what do you what are you losing like it's nothing just she's just gonna go and that's how it happened wow okay this is an amazing story and again I thank you for for the vulnerability here tell us a little bit about you know your first entry point into real estate was that here in the States was that back in Africa no so it started in the in the states here right with Africa I just knew that I was gonna one day I'm gonna make it and buy a house but at some point I just wanted to get out because the more I go on my education the more I know what this is not whatever I want more so from high school I know I want to go to college I was like this going to be a big deal for me to back them to go so I have to do really good for me to get a scholarship to get it so me I made it to college I ever because they eventually let me go to college it was more like okay you have to be a doctor it's but African families they dictate your life this guy especially with your woman so it's like you're gonna be a doctor I I have good grades in chemistry but I don't like biology and chemistry at all and I don't like blood so I was like I have to figure a way so there was this program computer science that was introduced because I was good at math it kind of clicked for me and I was like this is what I want to do and they're like you don't want to be a doctor I said no I don't want to be a doctor so it clicked for me because I love programming and that's how it is so me being in the college but the girls that I started with all of them drop down so I must I did a bachelor's computer science and a minor in mathematics so during my final semester at this point there was just few girls or maybe two of us stick to one of us in a computer science class so I'll go to some classes all boys right so I was like you know what let me start a non-profit organization that's going to teach girls how to program how to code just basic ID skills so I started this non-profit organization at that time I already have an internship at a software company in in the country there so I will use their computers and we will travel with the with the with my colleagues in the organization and teach girls basic ID skills like how to create a calculator how to create folders and stuff like that so it kind of took off and then different readers were doing it so at that time there was this program called Mandela Washington fellowship and this time President Obama this is 2016 President Obama was the president so he started a a fellowship named after Mandela I've been honors and it's for young African leaders that that are doing amazing things in their Community it's like fighting Wars helping women violence crime all that stuff so a lot of people will send me this link and say you need to apply because you're doing amazing things I'm like I can't compare to what these people are doing but okay I'll just apply and I applied and I keep going first interview at the U.S embassy I was selected second one and I moved on to the third one and if they email me from this year and so you got it you know I come to the U.S you're gonna come to the US and we're going to place you at Northwestern and after your fellowship you meet President Obama in DC so that's how I came to the US yeah that is amazing and I mean that was that a dream come true or was that you was that so far out because like for me I I imagine you your dream was to go to college but maybe I'm sure you never imagined this right so what did that feel like it was I was like a celebrity my attitude was so happy so that was also a ticket that now she has to push they have to push my sister for me to come because my alcohol then she they were like she did not even she got picked by the U.S government just let her go she's gonna come back she's not going anywhere so I was like I bet that I was like I'm not coming back to murder this guy I mean like there's so many other things for me there's more for me to accomplish than just come back and get mad and that's it and enough and that's what happened so but then I was already applying for other scholarship at that time so by the time the U.S embassy was processing and doing the orientation of How It's Gonna be when I meet the president all that stuff I was already applied for schools here in the US and I got a full scholarship to study and at the University of Illinois and yeah I was like when I come back I'm not going back that's amazing so you were studying um I guess computer science or you I so in Africa right and then you come to Northwestern and what are you studying at this point it was Battleship yep okay and so you um obviously you crush it you make it you finish the program and you go into these respective careers or is this one your real estate Journey Begins yes so when I left for the a presidentialists came back in with a student visa to study for my Master's Degree at University of Illinois hours because I was a student fellow I was given a stipend of a thousand dollars and I worked for the University as a data data analyst so I analyzed their data and they waived my tuition fee and they gave me a thousand dollars type and a debit card of course a bank account so I was I had to find roommates just to because I only have a thousand I have to pay insurance all of that influence student insurance is very expensive so 500 goes there the 500 has to be a range of utilities and boss fare and all of that because I couldn't drive or I don't have a car so with that 500 I have to find roommates to be able to you know get a place so I have multiple roommates so what happened was my my whole class mostly what their parents will do is gather them a place and then they will rent out the rooms more like rent out the spaces in the room so in one room you could have they could so let's say the rent is 800 right or a thousand dollars they will rent out each room they will rent after International students to sleep on there so that the whole concept of uh renting a room is more like renting a space so you get your mattress and you share that one room with three other girls so we were paying rent to them while they take them when they make profit and take that money and pay their mortgage we call that Arbitrage I was gonna say it's the ultimate house hack house hack Arbitrage okay so it sounds like you saw that happening and instead of thinking well I'm being ripped off or that's not fair they're charging more than they have to you thought oh I want to be in that person's position I want to own the asset and I want to be running out to people right oh yeah I was like this is amazing idea I was like I'm gonna do this one day so I always had even when I was starting searching for my first property I was looking for a property that has more than one unit so that way I could I could do more rooms too I love that see your data scientist's brain was like okay the pattern that I need to catch on is a property with more than one unit more than one bedroom a lot of spaces that can be rented as opposed to a pretty kitchen or a nice backyard or you know the things that everybody else is oh I love the oak tree in the front yard you're like no no there's no space in an Excel spreadsheet for an oak tree I need to see the place that I can get the most beds into this unit I love that when did you start trying to invest in real estate yourself yes so after I graduated of course I don't have any savings but I don't have student debt right and of course coming as an international student you get a Social Security but I never knew anything about credit because I lived in the school setting I work for the school I go home study come back well for school go and study come back go to class that's all I knew so there was no introduction to credit or anything credit score so I have a debit card that the bank gave me that I get my thousand dollars from that's it so I don't have any credit but again when I graduated I had a job to work for the CDC in Atlanta so I moved from Illinois to um Atlanta Georgia to offer the CDC as a data scientist first couple of months I started September 2019 just few months later covet happened but before covert happened I've already started doing my research because I was like I've never made that much money that I had right at that time I have saved of 8 000 I'm like I'm ready by then because I love reading so I went and said okay my first paycheck of course I have to send money back home and as an immigrant you can ask any ingredient Associated from Africa if you travel to the US or travel abroad you will like the ticket so everybody depends on you everyone you have to take care of your family and stuff I'm like this is not gonna work out where I just work and send money and that's it but when does it stop and how when do I save so I said this is what I'm gonna do in a tape all what I save and then start investing real estate and of course before thinking of I already knew I would do this day but I don't have the knowledge so what I did was I Googled went on YouTube and I see BiggerPockets coming up a lot of course and David David and Brandon every Wednesday you guys have this uh event that you do that's me in the everyday listening at work I'm listening to the podcast and cooking I'm listening to the podcast I'm in the train going to work I'm listening to the podcast so by the time I was already I had so much information I said okay they said the best way to get funding of course funny one number one is to go and walk with local banks I was like okay I cannot afford Georgia of course at that time it's like let me start with where I saw what I wanted to do it was just annoying so I looked at properties in that area the same city that I went to college in uh explain to it and it didn't I wasn't finding properties so I called different cities different uh banks in the city made a list and I called each of them every day I'll make different calls and I get a lot of no's but I'm used to getting those I didn't let that stop me so I finally got went back to this thing to me and I said I just started working so you see this is how much I make this is just my base salary but I'm gonna get more as I go and this is how much 8 000 is what I saved up I'm ready I'm buying looking for properties in this Pride when I already have my document and my speech ready for when I call what I say and how many how many banks did you call yamu it's a lot of things I think I listed all of that I just went on Google and I just did all the banks I called a lot of bands I cannot I couldn't even tell the number I call every Bank in that City and around that area and then finally you got one that that would hear your story yeah so so she actually uh she wasn't the well she's the vice president of the bank now but before she wasn't so she was like well I know I know you've got all these great things and you know how to analyze properties and you know you know what you want what aspect you want to go to however you don't have any credit score what you can do is to go get a Discover credit card Capital One credit card bill your credit score and then you can come back in six months or like in one year so I was like okay at least you get to listen to me and then I was like you know what because every day I'm analyzing this I want bigger project analyzing this that we did I was like I got this this took me a chance so what I did was I was like this is what I would do I found a property that was listed for fifty two thousand hey what's up um the owner the owners were going through a divorce and they were desperate to sell right they wanted to get rid of it they wanted to separate and do all of that stuff so I was like okay found this property I went under contract even before her approaching the ladies I approached her back and say I found this property it's 52 000 it's three units two bedrooms at least are rented for 750 one bedroom so I rented for this lunch even if one only one unit is rented my mortgage would not be I'm still cash flow so I wrote the numbers down because I run it in the calculator and everything makes sense so I submitted to her and then I called I submitted by email first and then I called her she was like you know what we'll give you a chance and they were like we'll Finance it and that's how it happened okay so you call uh you go down a list of basically every Bank uh in the city you keep hearing no no no but not a big deal because you're used to hearing no's so you just keep going finally someone is willing to hear you out and before you actually get the pre-approval or the approval from them you find this house and you say I'm just gonna I'm just gonna make an offer I'm gonna get it under contract and I'll figure out the financing later and so you get it under contract and then you go to your Banker you're like hey I got it hello can you approve me and they're like all right we're gonna make an exception for you and then they basically fund the loan yeah they funded it they were like well the reason why we did is because it's not like your credit score is bad you just don't have history right so I because my friend is fresh so it doesn't have history but it's not bad and I don't have any other debt I don't have any other expenses I don't own a car that time I don't I'm not paying anything except those two credit cards she told me and I was already paying indoors up for two months before she was like okay we'll do it wow that's amazing so you buy this property and you said all right even if I just rent one I'm gonna cash flow what ended up happening did that property end up filling up more than that how many units was it it's three units and it's a two bedroom it's a mix of two bedroom one bedroom everything that could go wrong in a deal went wrong in the property turned out the property manager the numbers that the the agent sent me were wrong the tenants were actually paid because it's a coffee at this time I close on that property April 17th it was already shot down already this is covet time that the one tenant I was about to leave and and there there's another tenant that's uh hasn't paid for like one year and then there was one unit that was vacant so then telling me they fully occupied it was bringing this much was for a lot so what I did was the unit that was the tenant was about to leave was in a better shape so we just I just painted that just basic cleaning and painting and then rented that out so while all this that was rented the rent was coming in after there was a announcement that the government is gonna the city were giving out to people that were behind on rent so remember that the the landlord and everyone has lied to me already at that point so the tenant that was that that was supposed to get that amount of money about eight months worth of rent was sent to me directly because it was supposed to be an application between the landlord and the Tenant so we applied together and she got eight thousand so I took that 8 000 and I put it to to renovate the other units and now it's cash flow for 2001 and my mortgage is only three hundred dollars wow that's amazing okay so so a bit of a rocky start um but then you're able to sort of work it out and out of curiosity because you said at this time you were working for the CDC right okay so was this like particularly a difficult time because obviously you're working for the CDC covet is happening I'm sure you're busy doing your your actual job and then you're also getting into real estate everything is going wrong so you're trying to have it you obviously have to balance everything was that overwhelming or was it like you know no no big deal it was is overwhelming but it taught me so much so at that time in my my team everyone well everyone in my team is a is a lab scientist who work in the lab I'm the data scientist so every time a lab scientist go into the lab let's say they go at 2 am I have to be up by 4 AM to learn the data so they can run it so that they can get the report to send it to a particular state so invited all the data that's coming on all 50 states about covid yeah it was a lot so I will be up at 4am I will have my laptop waiting to analyze data while I'm also checking my real estate and trying to figure out what the numbers and everything so it was not easy at all but I was still listening to podcasts I never get I was already in I had to figure it out but it was not an easy time yep it was it right and so you go on to buy more properties but you you said that you were sort of struggling you were kind of saving and maybe you had to send a little money to your family back home and then you had to renovate this property so how did you keep saving money or how did you save money to keep buying more property was there a specific skill or strategy that you developed yeah so when when I got that first property stabilized I I was like okay what next thing I need to do is move on because I don't I don't I'm not having any much cash flow coming in at that time so the property was actually cash flowing a lot like 2001 but however I'm not getting the the money like it's going back to the property manager so I was out the property manager was stealing from me every time I talked to him he was he he said he uses his card to to pay his contract because he most property managers come with their own team so he said he paid his contract for example they say he said I paid a contract of five thousand to do the flooring and paid for this for this unit right and I know and I'll just do that my calculation like the longest I'm not making sense but I know that it's cash flowing away because the tenants are paying at this point anyway my property manager always say oh just the this or just said that so I know the contractor's name is Chester of course I'm not I'm a data scientist if I want to sign data anyway I would find it so I went and researched on him it's a small town that research had never found him and I was like hey my name is yamu I know that you know you don't have to answer these questions but I have this property in this place and this is the address and I know you walked on it so hit it up let's point it back and say yes I was like can I can we jump on the call and he was like yeah sure so I asked him I was like does this receipt make sense did you charge me this much he said well I don't know it's an honest guy older guy he was like I don't know how much you guys talked about about your contract but I will never charge these prices and and this other receipt is not even for your property this was another property so it turns out that he was charging me giving sending me receipts because I'm out of state investor right who's sending me receipts off all the properties that he was working on and I was just paying for that so I fired him and of course I stayed with the contractor and he's he's a full-time contractor with me now you have an amazing relationship so even though everything went wrong I got my team from there and he's made me billions so wow I learned I learned that I've been reading ever since walked to all my properties it must have been actually great though that he ended up being a lot cheaper than you thought right so whenever you used him again it was actually more affordable so uh how was it working with him I mean was he because you said you work with him to this day was he a large part of a lot of the projects that you went on to go and and work on oh yeah he worked with all my properties in Illinois so I invested in anime with Illinois uh Cleveland at Ohio Illinois and Georgia here so all my properties majority of my properties are in Illinois he worked on all of them wow but that's how I scaled and and then yeah so scanning from that property after finding him I was like okay I'm not gonna find a deal that's as amazing as the 52 unit 52 000 property that's three units that I placed for almost 90 000 after a few months of fixing it so I went I was like okay where else could I invest in of course I went back to Bigger Pockets at this time I'm so active so I was like what do I do next so a lot of investors were talking about but it looks like California investors talk about buying Cleveland they have properties their cash flow is great they'll say okay maybe I should look into Cleveland so I went on bigger pocket and I went and started Cleveland investors so of course you have segments of like if you want to invest in a city you just find those investors there so I reached out to them hey my name is Young I'm a new investor I'm looking to invest in Cleveland so I get a lot of a lot of responses so we'll say don't invest here this is the AAA where this is be it is a sea area but the internet that they recommended for me to invest is I can't afford that so I said I'll stick with a CD area and then grow up from there and that's what I did so I found this duplex in Cleveland that's listed for 68 000 so the owner has listed two of them actually so I wanted both of them because at this time my cash flow at my property is Section Eight like all three units cashless coming in the bank is impressed with that so again I bit the documentation put all the numbers together and I sent it to them they're like yeah we'll Finance it and this is your second deal right your second and third second okay cool yep yep yep so the bag was like yeah we'll Finance it even if it's out of state the numbers look great 68 000 mortgage was 250 something I was still units when it was seven something so when the other one was six something so I was getting like 13 245 or 1350 or something like that and that the tenant pay all the utilities I only pay water C1 okay so walk us through this really fast your first property you said you bought it for like 55 000 you fix it up it appraises for 90 000 so you've built in forty thousand dollars of equity you're like okay I think I think I experienced probably the worst part of it I'm gonna do it again and then you go and buy two duplexes and the bank finances those and then just for for reference how many units did you actually end up adding to your whole portfolio in year one and yet when I think about maybe I'm this seven wow I think seven or eight yeah first year of real estate investing with no Foundation other than listening to Bigger Pockets and doing research and everything like that listening to to the great uh David green and Brandon Turner and you're like okay I'm gonna do this and then you go out and you buy seven properties so you get that first one two duplexes tell us about the next four really fast yeah so the next one I was like okay at this point I'm getting cash low I'm getting a lot of casual and I just got promoted like my job so I was like okay from this I want to scale more what can I do right so at this point I'm looking at I was like how about I take the cash flow with few months and buy a really cheap house so I already build a relationship with that contractor so what I did was I found this property for like fifteen thousand it was there was also a foreclosed property so I got it for cheap they probably got it for less than that but I got it for cheap and it was a five bedroom two bath so my contractor charge me nine thousand to fix it up even even at that point I don't have nine thousand I think I have like three thousand at the point that I have in my savings and the rest I was expecting it to come from the cash flow because I'm getting you know two thousand here and 1300 over there so I was gonna pay him in installment so that's how I got that once once I fixed it up I rented it on Section 8 as well and then I had equity in that property so the bed was like you can pull out Equity from your property if you want to scale that's how I did that David there's a term for doing that right when you when you like fix up a property and then you take the money out yeah and there's also a method to scaling both of which can be found at biggerpockets.com store by checking for the burbuck or the scale book you know I wanted to ask did you get these ideas because you're kind of like tinkering with different real estate investing strategies you've got the Arbitrage thing you talked about rent by the room Section 8 a little bit of long distance investing as well you've been working into this right did all of this come from Bigger Pockets yes it did I know you're gonna ask me in the end what's my favorite book and I have it here so this makes sense to me because I live in Atlanta at the time there's no way I can afford properties online at that time this is over the credit score so I could only afford outside like it doesn't have to be your background and I me learning that from bigger Parts like whoa a light boy went I was like of course I can do it I think but a lot of people that I talk to even award my colleague they were like there's no way you could be the landlord's hard you cannot fix a toilet while you're out of state and I'm like there is the method yeah I've already read and that's like I've listened to multiple people do it why can't I do it well when you mentioned that you found the better property manager that allowed you to scale that's what I thought of was sometimes we just kick around trying to figure out this is going wrong that's going wrong and it affects your emotions you just don't you're not excited about buying more real estate because it feels like just nothing but problems you got ripped off by the first contractor that would make anybody want to quit right like once you get your heart broke you don't want to love again you don't want to put yourself out there and find somebody else so you just quit but when you found the right person it changed your process to be emotionally excited and instead of emotionally discouraged and so the core 4 I'm sure really helped can you remind me where were you at with passive income at the end of year two you two by eighty thousand because I'm I'm list April this last April is my 30th invested so by 2022 I was making like 80 000. that's gross rents correct that's not your problem no that's no that's that's profit wow you're making 80 000 profit after your second year yeah that's profit wow after your second year what about your first what was your first year do you know off the top of your head I think that first year I was close to like six seven thousand but then what happened was I got a package deal so it escalated fast would that package deal some of the units turnover was like two weeks three weeks so my contractors will actually go into the unit and leave their their property leave there so they would stay there for that two weeks while they're fixing it so I was renovating houses faster so what happened was the reason why I scale faster is with the cash flows for everything I was getting my expenses did not increase with nothing my last downloaded increased it was just the same so it's a matter of how much can I buy because I do have a team that's willing to do the work so what happened was and my LinkedIn I was getting a lot of messages from other companies it was in the pharmaceutical companies to work for them I said well I have a job why how can I work two jobs because me as an international person I didn't know you can have two jobs in the U.S so one of my friends that I've met from BiggerPockets we got connected from bigger buckets and we find our own restaurant and every Sunday we talk and we call each other accountable I can say accountability group they were like we have two jobs why can't you do it I was like okay so I took that second job as a stethoscope programmer for LabCorp it's a six figure job I did the interview I didn't think I was gonna get it the next day they called me they were like you're amazing you can start on one day I was like okay so I got I got six field jobs I was dumping all that money into buying more real estate so I was buying packages at this point and just throwing them I said to me so you you're working a full-time job for the CDC you join you have like a mastermind with people from the Bigger Pockets Community they're like we all have two jobs you should have one too and you're like all right sure you go you apply you get a six-figure job and then they're like yeah so now you're making really good W-2 income and instead of spending it going out and just having fun you're like I'm just going to put it all into houses everything everything in the houses so I've been packages five units package deals uh six unit here five foot five single property so I was just doing and sleep with them okay all right so you um all right so you said your first year passive income six seven thousand or something like that year two it goes from six seven thousand dollars of passive income a year right and the year two it's eighty thousand dollars of passive income yeah are those numbers right yes okay the reason why I got to eighty thousand is because at this time covert happened 2021 everybody's talking about 21 20 21 2022 everybody's talking about Airbnb Short Time Rentals something Atlanta everybody was talking about social media so my social media page what I did was I created a new page and I followed just on real estate everything that has to do with real estate so I get a lot of people advertising about you know you can get a property you can you can do uh Airbnb without owning a property I was like okay so I looked into that by a few courses handy 100 here 150 here and I joined these musculine that's like I'm just going to jump in and do it I credit the LLC just like the the courses would say and I approached apartment complex here so I was like how about I get these in my LLC name and I can arbitrize it so I got one unit I arbitrized it and my and two weeks three weeks into into it or three months into it I got a booking for forty thousand dollars so the company book for this guy yeah the company booked for him from New York he's gonna be working in Atlanta for one like what like a whole year so it's like forty four thousand dollars I was like this is a double brainer so I got multiple now I have eight Millions that's really cool so you're let me just clarify something when you said your year year two your passive income was eighty thousand was that 80 000 per month or per uh year it's per month so oh my gosh yeah so my section is we're bringing in about 50 16 000 right and then I was making my yeah I was making about 40 something dollars on on on uh Airbnb with the multiple properties wow okay so okay so year two is eighty thousand per month I thought it was per year and I was like oh eight thousand bucks a month I mean most people work for like 10 years to get to that level just eight thousand dollars a month so you're getting eighty thousand dollars per month um yeah and so you get into the Section 8 game you get into medium term rentals and you do Arbitrage were any of those your favorite or were they all just like fun because it's all just new Section 8 was more off uh a dream to give a family a home the midterm writers were more of me buying and scaling so why when I in 2021 when I was by when I was doing the Arbitrage I was like okay I already have a bad run real estate where I own my own properties how about I take this money instead of renting for apartment complex here how about I buy my own apartment that's why that's how the 80 000 came about for months so what I did was I was like okay I'm gonna take this method and I landed the Arbitrage but use the money to buy my own apartment because there's a single families and rented on Section 8. so I found this property that's listed for in the same city that I I invest in my uh section day I got I found this property that was listed for 145. it was abandoned for two years and the landlord just want to sell and get rid of it so there was a fire incident that happened and he was going through a lot of violation so he had the city removed most of the violation but it was always at the eight so when I came in I offered 120 and he 120 and he accepted at closing I got about five thousand again I approached the bank and I told them the method that I was doing so I always keep I had this relationship with the bank already I always make sure they know what I'm doing so I told them about about the short-term rental Vietnam rental and they were like that's all I've been working a small City like this what they don't know is that property works for me because at this point I have experience with travel nurses so that property was between two Hospital one 1.6 miles from one another at One hospital and 1.2 miles from another house so it is perfect for me I did the analysis the market research and most of the people that were renting to travel nurses there were like a month have passed so let's say a family has a basement and they wouldn't need to travel those other room or something I would say well if I have this property which is eight units I have multiple mixture of single one bedrooms and Studios I could do that too so that's how right at the bed was like we thought you were crazy but this is this is amazing number so with that property that helped me scale to 20 000 because when I when when I had my contractor going there and he leased one album from that City he came in there he gave me a quote for 85 000. so I gave it to the bank they were like okay we'll Finance it so of course I put 20 down and my contractors they gave me they were like it's a lot of work they need where you can do what we can do is waste the you know to give you a great spirit of three months so you don't pay you only pay interest that's amazing so my contractor was like we will move it I will fix it front up and move the way down so while they were fixing but let's say they fixed two units I'll furnish it and have nurses on it I'll miss you to have nurses already coming in so by the time it was it was always complete I wasn't paying I was only paying interest no mortgage that property alone brings me 22 000. that's how I scale to the 80. wow 22 000 a month a month 22 23 24 here yeah you know just yeah just 22 to 24 000 like a real big deal be conservative yeah I'm looking it was just 1200 and then issuing itching it I paid like utilities for 100 uh 1200 with my mortgage and each unit utilities is like 100 110 120 something like that okay I've got I got two questions I want to ask the first is do you have one person managing all these Assets in different locations or are you doing that yourself no so I Cleveland I have a property manager Cleveland properties remember they came in with tenant occupied already so I was managing for a while but when I was scaling with the Midtown rentals here I have to find somebody to manage it so I have a property manager in Cleveland and of course in each of the Cities the closest cities will have one for office Advantage yeah you really are following the long distance real estate and then you you manage those individual property managers right oh yes okay next question how are you running your numbers like you've got a different approach to this and I'm curious if your data scientist background led to you looking at things differently but can you share what your system looks like when a property comes your way and a bank thinks well this is all the income it would generate you're able to generate more than that what are you doing differently yes so I I this is how I run my numbers right if if the numbers don't make sense I'm not going to push it just to say I have this unit for Section 8 I want to get at least 800 to a thousand profit right because it comes with more work more attention and everything with short-term rentals I was just looking to scale so it depends on how much I finish it if I'm gonna put two thousand three thousand dollars of up to five thousand dollars per unit I want to get at least a thousand dollars so with Atlanta I could get all the way profit to two thousand so at the peak season for profit per door so that's how I run depending on how the property was set with uh Section 8 Section 8 I'm looking at at least a thousand because it needs more work and I have to have pay the property manager maintenance of course so I include all of that so that's how I run the numbers okay and I'm gonna assume you're also factoring in they need the cash flow more because in some of these areas you're buying in you mentioned C to D areas they're not going to appreciate as much and the headache factor is higher so you have to make up for that by getting more cash flow to make the juice worth the squeeze so to speak and that's where you came up with these numbers right yes for people who hear this and they think I want to do what she's doing which I'm sure everybody's going to be thinking what are some of the challenges that people need to be aware of if you want to grow a portfolio the way you grew yours there's so many challenges you'll gonna go through crappy contractor station no investor that's going to tell you oh yeah Mike I have one contractor from day one never stole from me nothing I went through crappy contractors to get there property managers even though you have a property manager doesn't mean you don't mind it you still have to run the numbers to make sure this makes sense because if I didn't do that I wouldn't know that a property Market was stealing from me or even sending me receipts of other properties right this it's not it's not that easy day easy way out you have to figure it out you have to render numbers and of course you have to always analyze deals for it to make sense if it doesn't make sense you can't force it there's also I'm hearing you mentioned there's a lot of management that goes into the properties once you have them you have to look very close which I think you learned at a relatively early stage because in one of your first deals or the first deal you were taken advantage of yes that separated you from this idea of passive income that you just bought it forgot it and there's nothing more to it that right maybe we need to start saying that but you have to pay attention to your Investments that it's not a thing that runs itself like it's often described that it buy a property it's TurnKey it makes money and you just go have fun on the beach or vacation everywhere and your real estate pays for all of it you don't have to still work has that been your experience or has it been more like it's a second job or a third job for yamu yeah yeah now now did I well not must edit but now that I've learned stuff going through so much mistakes and I've learned to go chill at the beach now so I put everything in place I have a property management place our systems in place I've automated things but the beginning no you have to actually work the business to actually make it work you can't just buy and just forget it there's so many things that is involved with it yeah so now I do daily day-to-day stuff like I have a VA that go through my funnest finder messages I have property managers that all I do now is sign leases and analyze this so yeah I mean you're you know obviously you came from Africa I gotta imagine that the tax code is very different there than it is here so you can come here you're crushing it you're making eighty thousand dollars a month you have two full-time jobs you're making six figures on the W-2 side of things tell me a little bit about your tax situation once you actually started really making money was this like a big shake up for you where you're like oh my gosh I have to pay the government money like what was that whole situation like that that's that's a really good question like it's a shock coming from African women up to Texas like that so the beginning I haven't already had my son and because I wasn't making advice I actually get to get a tax rate for and I was like this is America this is amazing America is nice at the end of the time you get money this is not an admission real estate and then where CPA tells me you're gonna be paying the is thirty thousand dollars I was like what it was like I was like no but in real estate when you invest you get to say it was like no but you not when you make millions and I was like what that's when I realized like what my job tax bracket was and then he said and also your W-2 is not helping because you have two double twos that are paying you six figure now and I was like oh my God it's like if it wasn't for Real Estate you would be paying way more to to address than what you're so the real estate is actually saving you and then I was like yeah this is this kind of container can't beat it as this much so of course I let the four months ago I let the Lockwood joke go and I just stick with the CDC one because now it doesn't really make sense having the kind of cash flow especially when I added my Savannah properties here that are bringing me about 15 16 000 a month in just Savannah Georgia I was like it doesn't make sense for me to get two jobs now so I let it go well it's also probably really hard to achieve real estate professional status uh with two full-time jobs and being the real estate thing I know that there's always conflicting stuff on that so this always reminds me of that there's a meme out there that's like it's the US government they're like all right you have to pay us taxes and then you're like how much and they're like we don't know and it's like okay what happens if I pay you too little and they're like oh you owe us a lot of money if you do we'll find you and it's like what if I pay too much and it's like we won't tell you you have to figure that out for yourself and that's that really is exactly what the the tax system is it's like you don't know until your CPA is like here you go you owe Thirty forty thousand dollars um so you you quit your job and did you figure out Tax Strategies or anything that was saving you money uh in the long run like were you doing any kind of cost segregation or any depreciation to knock down your tax bill yeah so my CPA did a higher dos all of that for me and then we have meetings every quarter so he tells me and project how much I'm gonna be um I'll have that I remember one time it was like you have they have about 60 40 60 000 that you need to spend before November and I was like oh okay so I just dumped it on the property I bought a property for 40 000 more house I fixed it up it appears for 200 000. it sounds like Rob's tax strategy he's just like that I owe how much I'm gonna go buy something right now yeah exactly I'm like all right let's write it off baby it's a write-off you guys ever seen that shit's creek where he's like buying everything and they're like you can't just keep buying it and saying it's a write-off I'm like it's a write-off okay so that I don't who pays for it the government the government the right of people I don't know so let me get a recap of your overall portfolio yamu you have Cleveland properties and those are mostly section eight correct okay you have Savannah Georgia properties how are those being operated Midtown rentals and then where else other than Savannah and Cleveland so I have uh Illinois I have Springfield I have champagne obana Champaign all that stuff areas in Illinois so I have like eight if you need here and there five units those are all so since I got the eight unit it makes sense because I was getting so many inquiries or travel nursing and I'm not able to get the report because it's all booked out I was like I need another one so I go to another apartment complain I got another one I got another one I kept going it's so cool so I have a mixer of shut down rentals meet I have a mix of victim rentals uh section 8. okay and how many units total are we at now so I have 33 33 dollars including the one that I just bought here so that's 34. wow so you have about 34 doors now 34 I think is what you said when you were a kid you sleeping on the floor all you wanted was a bed of your own in a house yes how does it feel to to achieve what you've achieved it's it's unreal like it's sometimes like this is me this is on fun times and this is why I give a lot especially when it comes to my team so I know where I started right it's just so real for me but I always knew that I wanted just one house I wanted a nice bed I wanted to experience what other kids experience that I did it but I never knew beyond my imagination this is all God's work God put me in this place to actually buy houses fix them up and give it to families that's why I said earlier mentioned was Section 8 is more of me housing kids like me or someone who could not buy their own home and then the short-term rentals just came into play but it's awful fulfilling for me that's really cool is a eight-year-old you proud of of yamu yes I am very proud of myself I'm so grateful to God well you mentioned uh the the tips with keeping your contractor happy I'd love to end with that if you have anything anything you can share with the audience about strengthening that relationship with your contractor and keeping them happy I'd love to hear it just just to say this my husband says when my when my contractor calls my phone ring is I'm so eager to take the call that anyone else including him I was like well he made me Millions you did it when they're walking I buy lunch when they send me pictures and I'm so happy with the world and I'm like dance on me so they're staying there yeah and also I stopped their fridges buy groceries and send it because they stay there when they fixing the properties with his guys so those are nice things and I upgrade his phones the older guy doesn't like technology and just little things like that that's really cool yeah you gotta take care of your contractors I mean finding a contractor that you click with is hard already but finding a contractor that you can click with for five years is even harder and I think uh yeah gotta keep them happy so that you can keep a lifelong of Home Building and home renovation going you know well yamu I think that we're all floored after listening to what you've done I mean you talk about it so nonchalant that you're doing this well I mean the collective jaws of the bigger pocketsphere have dropped as they were listening to this we will definitely need to have you back to dive deeper into some of this because there's so many elements from the power of your story to the way that you've scaled to the passive income you're making to the systems that you've set up to how Bigger Pockets helped you learn all this I think so many of us listen to this and we only see the reasons that it can't work and you came in and said wait you're going to give me all this information for free and you went and put it to play and what do you know you're one of the most successful investors that we have ever interviewed and how many years has it been it's going to be three years April 17. yeah there's people that take three years and can't finish one of the books I just think I don't even know how to put into words what this has been like it's just fantastic and I really appreciate you sharing your story are there any last tips that you'd like to leave with our audience who are struggling to get started it's just the start and not like like video poker said analysis if you stay there you don't actually jump and do execution it's not gonna work out you can listen to all the broadcasters you can read all the books you can go to all the game walking effects you can do all of that but it's going to actually execute it's not going to happen and I know it's scary but you have to do it yeah well when you grow up without a bed I don't think you're as scared of failure as somebody who has never faced that level of adversity and the littlest amount of rejection seems overwhelming so yeah I just I mean who would have thought that those bed bugs would someday be a blessing but like maybe that could be the title of your book how bad drugs become blessings when you write it because you definitely need to Rob any any last minute thoughts from you no just wanted to thank yamu I appreciate the vulnerability and the openness that you had with us I know it's like probably hard to talk about sometimes especially you know coming onto Bigger Pockets but I think there will be hundreds of thousands of people that listen to this podcast and their life will will change because of your story so I just want to thank you thank you so much it's a pleasure yep it was a pleasure to have you uh where can people find out more about you if they want to get in touch so my Instagram is Building Wealth from rentals I actually got that name from I think Ashley has something like that so when I was creating yeah so when I was creating my own page I was like this is for me and I started as me just doing it to hold myself accountable so I started to like document my host as I was like what name can I get I was like building well from Ranger so I started with that so you can find me at Instagram building work from rentals and Tick Tock building well from rentals there you go send her a message Rob where can people find you well you know I mean it listen it's not a big deal all right so I don't want everybody there everybody that's listening to this be like whoa that's crazy that's a big deal but you know your friend Rob here is now verified on Instagram so if you look up raw built r-o-b-u-ylt I'll have a little beautiful blue check mark next to my name and uh you'll never have to worry about me asking you randomly for crypto or to send me Forex so uh yeah find me on Instagram look for the blue check and I will never message you first what about you David uh you can find me at davidgreen24.com uh and you can also find me on all the social medias at davidgreen24 including YouTube yeah I'm still my brain's still trying to wrap itself y'all moving around how you did this in three years it seems like it should have been full of holes but as you've talked we've seen very few holes in your entire strategy it was like you were born to do this I mean like it almost just seems like you had divine intervention thank you thank you you are a real life superhero and I hope that your uh your husband knows that you should go tell him as well as your kid and you have another one on the way right any day now you're gonna be any day now and you know how she'll be here congratulations that's amazing congrats there you go yeah make sure that when you're like listening to the podcast you put your headphones around that so that she can hear all the things that you're learning I think she's gonna go she's gonna come to the war be an investor yes that's exactly sure cases she's got no choice that's awesome all right we'll let you get out of here this is David Green for Rob quick I need to buy a house so I don't pay taxes I'm a solo signing off [Music] thank you Mommy

Channel: BiggerPockets

Views: 378,499

Keywords: passive income, rental property, income property, rental units, cash flow, real estate cash flow, real estate investing, invest in real estate, how to invest in real estate, short term rentals, mid term rentals, travel nurse, traveling nurse, medium term rental, make a million dollars, how to make a million dollars, financial freedom, financial independence, how to invest in rental properties, how to be a millionaire, biggerpockets, biggerpockets podcast, podcast

Id: QIjJ9gUN_KU

Length: 58min 33sec (3513 seconds)

Published: Thu May 04 2023