How to Buy Your First Real Estate Deal with Grant Cardone

so known as real-estate rise gonna be a great show today grant we're going back to my old stomping grounds we're going to start from Ground Zero your first deal we're going to find your first deal that's the name of today's show find your first deal well you guys got this real estate investing with Grant Cardone big three oh five eight six five eight six six eight three oh five eight six five eight six six eight I'm thinking about getting rid of my plane guys hey dude I've been looking at planes all weekend okay they're tripping me out yeah I mean you want to get I said Elena I need some new inspiration she's like going controller comm that always does it for you I even look at homes I can't afford they got a house down in uh and what South a here the L Gables Coral Gables on the ocean thirty two million dollars I did the math on it but put ten million down it would cost me 120 thousand bucks a year no no is that right no no it cost me a million no let me see 22 million 22 me see I'm still sexing over it I didn't put 10 million dollars down and it would cost me 12 132 yeah 130 mm what's the debt 20 22 million dollars no it's gonna cost me 100 grand a month yep like dang dude at 110 110 a grand a month and that's before the lawn mow is mode before furniture then I got to get a boat because it's got a damn boat slip so that's gonna cost me what's that gonna cost John it's all free it doesn't even matter it does so selling a mic I mean I put 10 million dollars down the first thing I think is what its first thing I think of real estate Ron how much money you'll be able to make down there I could put no no I can put 10 million in an apartment deal I know I'm like I could I could buy the same up I could buy a 32 million dollar apartment that would pay me for eternity with the same 10 million dollars isn't and by the way I don't have to get a boat so I'm like how do I do that life how do I do that lifestyle without spinning for it oh go rent a house for a hundred grand a month yeah or 200 grand a month I can win I can rent that house for 200 grand a month and get it out of my system that would be stupid too right rather than committing to it for 30 years and use the ten million dollars to go buy an apartment that would produce incoming to pay for the house yes see that's what we talk about on this show so really appreciate you joining me today appreciate the shares thank you so much stuff so much let me just give a shout out to all my friends that are sharing by the way we're getting ready to start the show this is the pre-show - real estate investing made simple and if you want to be involved in this documentary that I'm doing that everybody's talking about if you'd like to get involved you can post a video on YouTube what should we call it guys grant cardone documentary yeah grant cardone document money documentary if you want to post a video of it rich versus poor what were you taught who taught you mom dad uncle aunt grandfather teachers what did they teach you about money did they teach you how to invest it okay and finish these statements in your video penny saved is a penny which money won't make you happy money is the root of all don't answer the question okay rich people are answer those questions and in addition to that the second phase of this is going to be did your parents teach you about compounding did they teach you about investing did they teach you where to invest did they talk about making money did they talk about getting rich did they talk about passive income did they talk about cover this in your video did they talk about multiple flows of income and how you were going to get it or did your parents have about this much financial literacy or were they financially illiterate I'm trying to show why people are broke okay stay with us hope you enjoyed the pre-show [Music] [Applause] [Music] [Music] I owned it hey welcome to real estate investing made simple my name is grant cardone here we got the whole crew we got a real estate run you know and miss captain Ryan because he flies a plane with me welcome real estate Ryan thank you sir thank you for having me today we got Roberts sis load the video genius on the ones and twos he's the guy that markets and advertises for you and pushes you out along my channel to make your brand your message clear with video and then we tell the whole world about how good you are what'd you do today Monday we talked about real estate we make real estate investing simple the number here's 305 eight six five eight six six eight we look at deals your first deal we look at your deal we make sense of your deal how to buy it how to sell it how to add value to it you might have seen an Instagram post or YouTube post I'm sorry a youtube post I did this weekend about one of the things I do to reduce my cost and rehab property you might have seen that on YouTube this weekend where I went to a hotel did you see that captain Ron yeah real estate Ron you're you were at hide how was it that I was it was at Hyatt yeah Hyatt nice hide hotel hyd e right here in Miami just up the street and I went up to have breakfast on the ninth floor and outside they have all this beautiful furniture and they got these arbors and a nice infinity pool we just bought a property called here on point up in Boyton beach boynton beach we're rehabbing the property and rather than me hiring an architect or designer what I do is I go to hotels that have just been done grab a $40 breakfast the black sharpie I take my iPhone out and I'm like couch table all that's by the way synthetic wood that they had on the tables which was brilliant arbors shoot it colors pillows boom I give it to captain Ryan real estate Ryan and I'm like hey dude let's do this at hair on point and changed her name from hair on point to heroes héroes point where heroes live where people go to live to become heroes hey my name is Grant Cardone and every Monday we do this for you I want to make real estate investing simple for you our lines are probably are already full we're full five collars on we got space for one more today we're going to talk about how to get started in real estate how to get started how do you find your first deal how do you get your first deal how do you analyze it how do you finance it how do you manage it by the way I just gave you the four things you gots to figure out okay let me pull up my magic real estate board okay man I hate I hate pulling this in because you know what then I take out all that real estate I just hate that okay so look when you're gonna buy your first deal here's what we're gonna do all right buy your first deal they pulled it my magic board buy your first deal first deal okay and we're going to assume because so many people are writing in particularly on our YouTube channel okay I had 200 questions if you go to my youtube channel if you subscribe when you subscribe when you subscribe and when you comment I'm the guy answering the questions there okay so whether you're wherever you watch this I actually get the content okay I get these questions this is what I use for my shows so I really appreciate your comments your questions if you're watching live great if you're watching after the fact either way I'm going back and looking at stuff you're like how do you find the time to do all this because I care okay I care so captain Ryan here who's off camera he says grant I paid twenty ten and picked twelve thousand dollars for courses is that true plus plus yeah what one course was ten grand I did the the Robert Kiyosaki Gil for the same courses that you're given information so look a lot of your asking look only got five or ten thousand dollars let me show you how to find that deal today and I'm also do I'm going to also break one of my rules here I say look man look for 16 units that is a perfect scenario 32 units is the perfect scenario but look if you don't have the money you got to get started a to unit or four unit or six units or eight units let's get started there let's rehab it let's get the final deal fix the deal get a loan on the deal short-term loans because we're going to flip you out of the deal so that you can move to twelve units we're going to do the same thing with the twelve years we're going to flip you out of that get you 16 units we're going to do that again that's what I did okay so first first four things the only four things you really need to do okay I'm going to give you one thing before this but four things you need to do you need to find a deal obviously find a deal there's one thing you need to do before these first four things I've talked about that in other earlier shows real estate investing made simple Grant Cardone TV by the way this is brought to you by Grant Cardone TV second thing you got to do is analyze the deal Ryan do you know the thing you have to do before these first four things you have to know 100% that's right that you want to buy real estate you got to know not just real estate you got to know this is the game you need to be in okay the multifamily game okay the fourth thing you need to do is you need to build a manage it those are the four simple things that you need to do with investing real estate there go ask your mom or your dad your uncle or your aunt hey I'm thinking about buying some some some apartments and renting them out what do you think it's a negative bull terrible idea Oh be careful oh my god don't do it and it's toilets and termites oh you're gonna have people calling you Oh a real estates to expense at midnight I am yeah I had a lady tell me I want to buy real estate but I don't want to buy right now because it's too expensive like then you're never gonna buy bait you can't just buy when it's cheap then you got to be out in the marketplace buying stuff okay so how do you find a deal the first thing to do to find in a deal is to go on a site or go in your local paper or start calling your commercial real estate brokers hey I'm looking for a property you got to talk about what you're looking for when we come back from break I'm going to walk you through it I'm going to find a deal while we're here I'm going to show you what it would cost how to manage it how to analyze it how to finance it put over 20 years of experience in the real estate game cash now PA is the place to go for buying homes for cash with no fees any condition with BBB accreditation great abou donor of cash now PA has been helping customers get in and out of homes creating better spaces for living and making a difference in local communities with the focus on buying homes all cash no fees with any condition also be BBB accredited visit cash now PA com that's cash now PA com buying or finding a new home should not be stressful or boring with over 14 years experience good time Tommy has spent his time building strategies tips and content that will help you the new homeowner or seasoned homeowner get the best deal for your money and UK navigate and celebrate because whether you're buying or selling you're gonna get more traffic to your property promotion on every channel and watch as Tom and his team work until you are satisfied your new home awaits you with good time Tom and his team subscribe like and follow a good time Tommy calm that's good time Tommy Chong's one company to work for in the smart home industry skyline security right now is looking for the best of the Grant Cardone following to join their team and expand financially and professionally go to join skyline calm to register labelled by Inc 5000 as the fastest growing company for the last two years in a row you get to protect families grow your wealth and join a team of top producers skyline is looking for great people go to join skyline calm that's join skyline calm to get started on a brand new 10x career path go to join skyline calm to register we're back and we're live thank you so much for being here I want to shout out to Coby Glen Braun gates Andrew Vannelli Charles and Mattila Lawrence thank you for sharing with your friends grant cardone is live we have six colors on the line I'm trying to make real estate investing simple before you do these four things find analyze finance and manage that would be called the what them before you find analyze finance and manage or we could call it the fam find a deal analyze the deal money money you need the money and you need to manage it what we're going to do is you've got to know this is the game you want to play okay folks if you don't know this is the game you want to play do none of this matters none of this matters folks okay male female young oh if you don't know you want to do the deal because you're going to have a bunch of people tell you not to do the deal now I'm pulling out my emails right now I'm going to show you a four-plex this came up a Zillow you normally I use loot net because I'm a commercial real estate buyer anything below what is it twelve units is not considered commercial is that right run five so one at one of four units is consider residential learn one word Warren Warren two for one to four units is considered a residential purchase on your first deal I am going to break my rule of sixteen units are smaller so Robert Cisco once it get in the real estate game okay he's like man he lives in Phoenix Arizona can y'all see this deal can I can I pull this deal up how much is this deal run bet that deals sold for two to 260 okay so I'm in Phoenix Arizona yep I'm gonna find a deal I'm going to show you how to buy this deal it's four units it's $260,000 okay don't worry about the price right now let's say we're going to give them the full 260 I go into every deal captain Ryan can tell you this I go into every deal assuming I'm giving them all the money right I was trying to buy a deal we just blew out of Friday right here in Miami okay and we went in we went in assume the full price of the deal plus some okay you do not want to go and say I'm going to buy for 240 if you got to make sense now you see now now do you took it over for me is that right am I still in the shutter yeah there you go so um if you got to make sense because there's a price to do this deal this deal doesn't make sense okay if this is a private deal four units five units or less okay you're gonna put 5% down where do I get that money from kepta I would go to a regional bank but you can go to Wells Fargo you go to Bank of America you can go to any bank FHA FHA yes you live in one of the that you can get FHA right a little one you can get a VA we're gonna live in one of the units for some period of time yeah that's how you're going to get the best loan here you could probably do this deal with 3% down so Robert okay Robert could go to the bank and say hey I'm gonna put 5% down that gets me what is that $13,000 yeah so imagine he owns a two hundred and sixty thousand dollar building for 13 grand okay now let's compare that for a second to vesting in the stock market if you if you have thirteen thousand dollars to invest in the stock market how much stock you get what you paid for it thirteen thousand let's say you weren't about thirteen thousand dollars with a Bitcoin you get 13,000 get it okay in real estate with 13 grand you can get a quarter of a million dollars so I know for sure that you if you can hold on to this deal if you do the next steps right the funding the analyzing and the managing if you can do those three things right and buy it right thirty years from now that place will be paid off Dave Ramsey it'll be paid off you won't have any more debt Dave okay but without the debt without the debt you could never do this okay thirteen thousand dollars is $13,000 this money is going down and value this is going to go up in value over time okay why not because it's real estate why will this go up in value captain Ryan captain real estate run because it produces income and this goes back to the first thing I told you you need to understand why this game works and why this game is different than a house what's different than an office building why it's different than any other commercial real estate okay so what are the payments going to be on this deal captain Ryan do you have the rest of numbers for me payments are going to be I'm gonna finance $247,000 dollars okay we're taking your calls by the way what are the payments of two hundred forty seven thousand seven multiplied times six yep the rate factor a money factor of seven forty seven one two three times six percent equals uh oh my god I'm so bored twelve twelve thirty five 12345 dollars I'm sorry no one thousand two three five so it's 1200 ollars a month no it's not do it again multiply 247 I got to do everything you know sure you do times 247 times six it's fourteen thousand eight twenty a year okay okay well that's a lot different than we need divided by twelve fifty thousand dollars a year okay so I round it up now what is the income of this property this is the debt this is the death I'll put thirteen thousand dollars down I'm gonna pay fifteen grand a year for it okay yeah y'all want to give me you want to pull the camera out so they can see the full shot John come on John come on Johnny sir Johnny keep it tight keep it right 2850 is the intim okay so the income on this deal gross now now in analyzing and what am i doing first thing I do is find a deal we found the deal it's down to bought a duck bottom left-hand corner here found a deal in Phoenix on 8101 thirty-third dry hot little piece of material on this joint this is the debt okay so what is the income on the deal I'm gonna go back and analyze it now what is the income 2850 a year a month per month well dude I'm doing an annual oh sorry about that Guddi for thirty four to thirty four thousand two hundred dollars okay what is it gonna cost me to run this operation remember my rule of some thumb fever is going to cost you $17,000 half it's not because it's smaller deal this deal probably cost you about ten thousand bucks a year is that fair to say you're gonna manage it yourself you're going to probably be on the property that makes me $17,000 okay seventeen thousand my debts 15 grand I make two thousand dollars a year that's your first real estate deal two thousand dollars on a 13 thousand dollar investment will be one of the best investments you make in your entire lifetime that's fifteen percent is that right fifteen sixteen percent that your two thousand dollars your cash flow are you after my debt yeah okay that's 180 bucks a month oh now you're like for $180 a month dude I can go free cash fan or a streetcar in from big for $180 you're right that's why I don't like little deals because they're paying an ass but here's the deal we're probably going to bail the manage this thing for like $12,000 a year because we're going to do it ourselves that's a nexus now twenty-two thousand two hundred dollars a year if we never raise the rents this makes me seven grand now it becomes interesting because I'm earning fifty percent on my money yeah but that last means in two years in two years look if you're not convinced to do this when I finish this today really I'm thinking Glock left pent temple okay see somebody to lend your bullets because it's bad it's bad it's wrecked okay don't go away don't leave do not hang up I'm gonna look at your deal when we come back for me I just made you 50% of your money boys and girls real estate made simple [Music] have you ever thought about just getting away with the right people at the right time to get your mind right and your business right guess what we're doing st. Bart's October the best weather you can find on that Island little exclusive island in the middle of the Caribbean it is an amazing place to go to my wife and I have been there hey guys my wife and my kids have been there twice now we're going back in October we would love for you to come join us five days dinner every night with us very exclusive trip we'll have lunch each day together the rest of the day we just build our life build our business build our futures map it out I want to do it with you they'll be there I am we hope you're there we're gonna have a blast are y'all ready for st. Barths girls [Music] franchising is listed by Grant Cardone is one of the ways to become a millionaire let the experts at plan finders be with you every step of the way is your partner finding buying selling and promoting franchises with over ten years experience brand finders is the company to help get set up a franchising to help you get set up with owning your own franchise and finding a franchise that's right for you is it friend finders calm that's grand finders calm to get started with your search today hey welcome back Grant Cardone here making real estate investing simple for you I just showed you a deal in Phoenix Arizona okay it earns $34,000 a year it's going to cost $12,000 a year to manage it we're going to make $22,000 our debts going to be what did I say fifteen thousand bucks okay you're going to make seven thousand dollars on a thirteen thousand dollar investment for - not a bad deal now grant if I rent one of the four units which we did I would not make $34,000 a year you remember what I did when bought four units rented three of them I lived in one of them that's what you're going to tell the bank and that's what you need to do for 12 months the end of 12 months you get the blow out of the deal and rent the fourth unit the first year you're going to get paid by three other people and you have to count if you're smart person you should count your rent you should actually pay this property rent I rent where I live today I rent where I live I actually own the building in an LLC and then I rent it for myself I pay myself rent okay you're like oh no I'm gonna rim the place is not gonna make 34 grand you does not count the money okay okay you understand so so if you have a question I want to answer it if you have a deal I want to answer it alright this is a 50% return on your money what do you need to know where do I find a deal how do I analyze the deal I'm sorry number two how do I finance that deal where do I get the debt from a bank regional bank Wells Fargo local bank it's easier to get this loan by the way then it's that single family house loan you agree with that run absolutely why because the other three units for this income you need to put up with headaches yeah you're gonna have to put up with a freakin $37,000 headache now I'm learning 600 bucks a month if I don't increase the rent tolas now imagine before I take the next caller get them ready imagine if I could increase the rents by 50 bucks a month 50 times 3 is 150 bucks times 12 is $1,800 now the 7,000 becomes 88 8800 what if I get another 50 bucks next year what if I get another 50 bucks a year after that what if I get another 50 bucks now I'm making 10 or 12,000 bucks a year when you were a pilot Ryan how much did this help by the way this is the deal you did right it is just one of them okay and then he sold the deal I made a little dough okay may 30 2009 there that's why he's on with the show but we got a lot of comments coming folks we had comments coming in we got people talk and we got them subscribing okay done yeah yeah do you mind you mind if I just add really quick so so to find the deals these deals the wonderful are gonna be on the MLS MLS or yellow so your relationships with real estate agents you know your you know your relationships with with let's talk to our first caller where's our first caller Verizon Philly Philly okay so what I'm gonna do is I'm gonna go to Zillow I'm gonna put in Philly what's up man hey hey there grant thank you thank you so much for taking my call oh come on man come on come on don't don't don't make me feel all mushy inside awesome yeah I I just have a quick question I'm currently negotiating a deal right now and I also just saw one that looks super interesting on with that yeah and I'm wondering which of the two you would rather do okay you want to give it to me yeah let me just get let me just guess the address yeah oh yeah no go ahead he says go for it I'll go and number two yeah okay I'll give you the address yeah yeah okay so what I'm currently negotiating right now is 2327 Park Avenue Park Avenue yes sir and where is that it's in Philadelphia it's right or right by Temple University really yeah you like it I don't love it the second one I just I'm gonna go up that one is the one I'm feeling I know why are we looking at 600k let me just tell you let me tell everybody something right now if you don't love the deal today I like it I like it now you said you didn't love it dude you don't love it today you're not gonna love it tomorrow I like it tomorrow I think okay you only want the one I love that I think I like I like more yeah I'm much rather than that man okay all right here we go all right so it's 6040 third straight six yeah what so fix out 43rd Street y'all watch me doing this right now yeah and it came up it came up in the search right so look you can find out anything I don't even need a broker right now okay it brings me to Lube net oh nice nice I like this man right bite you pen okay so he stepped up so give me the numbers man give me the numbers on this deal yes Joe it's for 1.6 million okay right now we just stepped out we just we just went from residential to commercial okay the seventy is 14 units yeah yeah 14 units no he does not he no longer qualifies so what are the four steps find a deal he found a deal number two and there's the money gonna come from okay how much you got you're gonna need 400 grand about this deal you know that right yep there okay the bank will finance a million - it might be a little less than that you might have to put 500 grand down okay the rule of thumb is 65% I'll get you alone 75% I don't know okay but if you got 75% if you got 25% of that's the 400 I can probably get you another loan for another 100 just to get you a traditional debt right here remember the four steps find a deal second finance and deal third thing analyze it what is the gross income of the property all right the Cabaret no I don't have I don't have you in common okay good give me the camp right I'll go in backwards uh well I have the rent I have the rent so we could kind of back into it if you want okay what's the total rent all right give it dude give me the cat purring you know they give me the cap right cuz I just saw I just saw that it's a six cap right okay yeah yep give me the cap right I mean give me a little in a why it's not on okay it's about a 100k yeah so sixteen three zero your there's room on this point zero six one it's ninety nine thousand four hundred thirty okay so it's got $100,000 Noi now what does that mean the Noi if I take it because the cap rate is on the site okay it says cat six percent it's not a six percent nothing ends in zeroes ever okay see he gave me a ninety nine number what did I do I rounded up so we already know the numbers are false very very very important to understand we're in the second step analyzing a deal but let me just average this fight this fund that we round off stuff right here while we're doing this you just got to understand that everybody's lying to everybody okay most of which is you lying to you yeah not other people okay divided by 0.06 so this deals a million 666 you owe me the price right yeah good so the Noi okay so we know we're going to finance this number this is the number we're going to finance 70 we know they analyzed a hundred thousand that's before debt we know what we got to put down this is our down payment right here hmm that's gonna be 72 K 72 thousand dollars is the debt how do we figure that out okay you take point oh six it's a rule of thumb 0.06 in today's rate market times the deck the million to 70 mm so this deal will make twenty eight thousand dollars a year if the 72 will cover your principal and interest before any rent yeah principal and interest oh also if we could it is possible if we gonna underwrite the exit I know you know that that's a bit good now this dude knows what he said out okay yes dude knows when you sum up because part of analyzing is how do I get out of this deal I've talked about it on earlier shows by the way you see all the shows at Grant Cardone TV ford slash real estate it's a 7 percent return I mean that that's with that's with no capex budget that's with no yeah because below I mean the important thing is knowing your NY like 100 percent knowing what the expenses are what the NOI is because if this property needs maintenance and capex that's gonna eat that twenty eight thousand dollars can you see it can you make it bigger for me cap let X capital expenditures oh it's a little con lag because I want to show you this deal because I mean what is this 1940 1938 how old is this deal man 1920 I said 1938 okay I was out by eighteen years but what does it matter when you're 100 years old yeah so so look we know what we're gonna have asbestos we're gonna have lead-based paint lead-based paint we're gonna have you can't you can do anything here dude every time you do something here I'll show me huh old plumbing old plumbing you got it you might be a little bit put them washers and dryers in it yeah okay good that's good and what are these things written for um so ya might be call you out Joe okay month monthly rent is dick 81 681 that should here number thank you for this video for the studio and over the one-bedroom its 840 it's about 50/50 yeah and you know there might be there might be some rental disparity right ya know um it does competing right this is a business on me I'm a flyer yes yes so what's the play here dude what's the play on this deal so I like I'd like to go in each year raised red 7% raise the rent 7% every year ideally it possible who's doing that who's doing that dude I mean you know that you possible blow me to market I don't know the market I mean yeah the thing that concerns me is my store thinking you're gonna raise the rent every year 7% that's not a real look look I've had property where I raise the rent a hundred dollars every month I got a problem we just bought we walked in raised the risk 200 bucks I don't need like when you say I'm gonna raise the rent every year I'm going to go into freaking crush the rents as fast as I can and maybe not raise them again see see is that easy all the brokers say oh you're going to raise the rents 3% a year dude I I go in first of all I figure I'm never going to be able to raise the rents I need to make sense of this deal when I analyze it I'll never be able to raise the rents and the expenses are going to keep creeping up and three or four or five years from now you're going to have some major expense on this joint so this is the real stuff you need to understand about real estate okay so how many deals have you looked at uh at least 50 good look at another 50 and then call me back and when you want to him bro when you walk in you can't like something you got to walk in and say this is a steal man this is steal you can't think I'm gonna maybe raise the rent seven percent of you you got to walk in and say I'm dropping washers and dryers by the way you didn't tell me what that was going to cost okay I'm gonna you know you know I'm saying do you have the room can you do it what will it cost like have all your numbers down and then call me back and say hey grant this things that screamer okay let's just talk question you ask the broker on this deal well I would ask him when's the last time it traded waited trade for what's the upside what's the exit how do I get out how much money would I spend hey would you would you would you buy this deal yourself okay what's the worst thing that can happen to me in this deal what's the best thing you could happen to me in this deal oh by the way I'd go back and ask those questions to them another time hey when did it trade last again I told you that in the last call I forgot man I didn't take any notes what did it trade for I don't know I don't remember guess okay what's the upside what's the downside what do you like about the deal what don't you like about the deal would you put your own money in this deal just I just freakin I just and then I call up a bank how do you see the deal how would you under right it what do you think is this real like why do you do that though why do you ask for a second time because because because what one you know I need to know okay the most important thing with any investment any business a relationship you're having a relationship with this this this building for the next thirty years folks you want to know I love this thing okay every piece of real estate that we own today if the world went to hell tomorrow I would wake up tomorrow morning dude everything got pulled down in value and I love it all okay I love it all I don't have to get rid of anything I just got to weather the storm there's going to be a storm I'll weather this storm and when we get on the other side of this storm baby all that property goes straight back to and exceeds where it last left off let's talk to the next call hope that helped man I do knows what he's talking about though see he's been looking at deals see the difference when somebody looks at 50 deals and somebody looks at the first two Ramon what's going on give me your deal this is Suze Orman and I will tell you what to do and how to do that this debt is good debt Ramona Ramona leverage leverage leverage ramen how many section it's Raymond Raymond Raymond Raymond real estate let's let it worry man on you that was good grant come on I got ya you know I put on YouTube that if you can't keep up a great you shouldn't call in so the area I live and there's a lot of bad economic area and I noticed that when you're rehabbing your deals that it seems to be like 7% is the rehab cost that you do is that just calculated strictly from the cash flow or in do you fair amount of shrimp now dude first of all first of all it doesn't have anything to do a cash flow it doesn't have anything to do with some 7% number I've never used that number dude it is what it is the roof cost with a roof costs okay floors cost what they cost carpets cost what they cost paint cost what it cost you got to figure out what it costs so what do we spend on that her on point on her on one unit or on the whole of the roof just the roof 835 K eight hundred and thirty five thousand dollars what are we going to spend on the on the on the the clubhouse two forty two hundred forty thousand dollars okay dude those two numbers totals those two numbers represent more money than I put down on my first deal mmm-hmm I spend more money fixing a deal that most people spend buying a deal so it's just as long as it fits in the deal and it doesn't affect my exit no because it will affect your exit right it will affect your exit because the only reason to spend money is two reasons raise rents or to sell now if I know I'm going to put a new roof on this was a roof and this this was a clubhouse okay and this is a clubhouse right first of all the roof doesn't get me anything the roof gets me nothing the reason I put a new roof on is because and by the way I could have waited three years but I just know because I played the game long enough if I want to put her new roof on okay I'm not gonna own this deal for 35 years let me go ahead and do it now what why wait three years this scared money weights this is what I said Bobby man Bobby's gonna wait and do it late he's gonna do it Bubba did if you're good if you know you're gonna get a new kitchen why don't you just go ahead and get one now I start enjoying it right get it over with man so we put a roof on the first 30 days be on the deal so what do they say new sheriff in town we went painted the curbs I don't know what that costs we're gonna fix the slurry coat this the suit though the seal coat the driveway said we're going to stripe everything so we're like there's order in this freaking joint okay we took a couple units and just went rip them out ripped out all the six thousand six thousand a unit six that would spit six thousand dollars a unit why am i doing that we get two hundred dollars increase okay okay that's a nice return two hundred dollars times twelve twenty-four twenty-four hundred that's a twenty that's a forty percent return on my money but why did we do it we didn't do it in the beginning we did it for one reason dude there's a new in town tell Eric Clapton isn't the sheriff in town okay whoo you shut up the sheriff writ on time oh boo yeah so dude dude why am i doing this in McGee there's a lot of different reasons what you'd want to do something okay one reason I want to do somethings I want to UM no new sheriff in town second reason is we raise the rents immediately oh by the way we're only going to fix check this out check this freaking genius out there's a hundred ninety two units there we're only going to fix about ten of them I'm going to raise the rents on those ten and I'm gonna let the other 182 come up with them so I'm not going to spend money on all of them I'm gonna spend 60 grand on ten units six sixty thousand at sixty thousand in total I'm gonna fix the club Allison I'm gonna fix the roof okay I'm going to spend some money on arbors and barbecue pits and I'm a freak I'm a sex to join up that's why I was at that hotel this weekend you can see that video on my youtube channel where I'm walking around the hotel them to find out what color umbrellas what color arbors who makes that material I can get the name off of it I don't need a hire architect or designer I just go steal other people's stuff right there what's worked in other environments you steal ideas all the time right I do this I do this for you real estate investing made simple so you guys can steal from my mistakes and not do them okay don't duplicate them okay go ahead you get what I'm saying here I sure do and I want to thank you throw the money that you don't raise for us veteran oh the little day you got it brother you got a happy Memorial Day thanks for calling in all right thank you hey make sure folks again subscribe to my youtube channel you're going to see us drop in more and more content on there about buying real estate please please subscribe to the channel post comments okay and I tell you what I'm going to do every month I'm gonna give away somebody that subscribes to qualify I'm going to give away I'll underwrite your deal I'll look at your deal who knows maybe I'll become a partner in your deal we're going to go to LA captain Ryan real estate Ryan doesn't know this but we're going to go to LA and actually shoot a show on buying big I'm going to look at your deals buy my big deals and maybe be a with you and your deals so if you want to be part of that part of that subscribe to the YouTube channel post comments send me your deal in comments if you got a deal when I'm out in LA or Houston maybe will give you a ring and say hey we're coming over to look at your deal I want to look at your deal we need to teach captain Ryan how to use a camera either that or I got to drag you guys around with me all over the countries next caller Chris give me your deal son give me your deal boy hey glad how you doing good brother good thanks for calling real estate investing made simple thank you for doing what you do I really do it free home and it's the least I could do is help people come up makes me feel good with a single said here's the thing I'm a 23 year old new business owner I just opened an auto dealership my wife helps me she works a time as well and I want in there that shadows first getting into met by family should I try again to duplex for flex now or reserve capital wait longer and do a bigger deal to start out like you talked about well grossing like a grease line you got to do is get your hair right okay uh well man look how much dough you got the cash I about all about five to seven thousand cast right now to work with well yeah okay so I mean the way to do it right now for you man it is is the flipper deal what's it what city do you live in Vancouver Washington okay nice little tight market love it up there okay I'd go you know I mean look ideally ideally is you wait but but if you can't wait because you got that freaking hustle hunger then what you do man what you do is you buy four units and you flip them there's nothing wrong with the slipper game as long as you guys understand you're not trying to keep this real estate forever you want to get in and get out as fast as you can all right so I don't know if you can see this is they're just a big lag okay Vancouver what why Coover Washington I dated a girl from Merridew she was hot - she was like oh well I thought you dated the girl with their first name Vancouver is like that's a little weird you know this girl she was sweet really I shouldn't say she was hot but it was it was it was one of those neurotic relationships Robert you've been in some of theirs dude it was freaking erotic it was there in place you know you know the only time we didn't argue is when we LuAnn a sex only time we didn't no idea the only time dude that everything was perfect was when we were having sex okay so so look I'm looking for four units whose eye owner how do I find four units on Zillow do you know you have a deal for me to look at man I don't exact deal no no I can find one yeah so how do I find four units home type let me home tight make your bank apartments there you go okay let me get rid of all houses I don't know if y'all see me doing this I basically went to Zillow Zillow Zillow super-slow um I see okay and let's see here okay there's a studio for 500 and here's another studio dude I mean yeah I can't even imagine paying $250,000 per unit so this is what this deal says this will pop up in a second a little bit of a lag here's a studio 2800 zero look at Washington or beat zebras Fabio I'm Vancouver Washington man yeah okay okay 9150 North East can you make it bigger so they can see what I'm looking at I'm looking at it right now yeah I've got 32 North East bills two years before I was born it's $570,000 so I'll just I'll just do the math for a year but you got to know your market I don't know what the upside is here okay you're going to put 5% down you're going to tell the bank that you're going to live in one side of it 275,000 Oh at $27,500 will buy this deal okay so you need you need to save up 22 grand right you're going to finance you're going to finance five hundred and whatever that other number is 40,000 what's the note of that going to be what is it without 540 times six is thirty two thousand dollars a year thirty they're looking for you thirty-two thousand yep thirty-two for thirty two thousand and and it's you know this thing is going to have to rent for what I mean what does it say it's going to rent for all three units attached single car even if you did I mean even if you did 1,200 1,300 bucks huh I mean that's high right $1300 so 1300 they'd probably financing less times times three units 3,900 bucks 4000 units there's only two units here okay those sitters what would this thing rent for three three units but I'd say up there I said there a studio feel about 900 bucks a month 950 well there's no way this worked no two grand a month two units times 1,024 times there's no way you you don't have the data this guy's got to rent for more than that otherwise they wouldn't ask of us okay so there's got to be some other data that nobody can sell something from what then it's worth 2 units 4 units 8 units 16 units a beautiful thing about real estate this kind of real estate income producing real estate it's all based on not what somebody think it's worth how much income it can produce that's what makes it real so so bro the other thing I would tell you to do man it's is know the market ok you need to know the market alright thank you for calling hope that helps and happy Memorial Day real estate investing made simple got one more caller I want to talk to that person hopefully you bring me a deal hopefully I can be your partner a deal what is your deal yeah what are you what is your deal you see another expensive city man almost impossible to buy there go man what's up cat Oh God talk to me hey hey how are you doing good man how you doing what's your deal tell me about your deal uh well I don't have a deal but so both my parents that's the way they left behind about 200 grand and I just wanted to know how it can get started in a real estate well okay that's a great great question that $200,000 is that is that after taxes I mean you've got 200 grand of use um no a belated growth is that yeah okay good so that's your money okay so this is going to buy about six hundred to eight hundred thousand dollars in real estate now here's the problem for you what are the four steps and find them find a deal man find a deal where you cannot mint you can't you can't afford to manage a deal outside of where you can touch a deal you need to be able to touch a deal you needs to be in your neighborhood you need to know that neighborhood you need to know what's going on in that neighborhood you need to know who the drug salesman is in that neighborhood literally you need to know everything about that neighborhood particularly when you're brand-new man you need to know who the the uncle pedophile is in the neighborhood you need to know everything good and bad about that neighborhood otherwise you don't need to be in a damn neighborhood I don't want to spend money I don't want to put 200 grand bro your mom and dad you know they hustled and busted it so they could put 200 grand way to give you that you don't want to blow it on this deal so no number one no number two find a deal I got to find a deal to I got to figure out where am I gonna get my funding from who's gonna give me let's say this deal let's say this deal cost uh eight hundred thousand dollars okay who's gonna lend you 600 grand do you know where to get the debt you have good credit loan do you have good credit yes good good then you probably qualify for a loan here's the thing they're gonna ask you have you ever managed a piece of real estate before right wrong right that's so captain Ryan real estate Ryan's here with me man hey man did you ever know we'd like to give you the loan you have good credit we liked you sorry mommy and daddy died have you ever managed a piece of real estate and your answer is going to be low they're not gonna like that answer yeah they're not going to like that answer at all okay in the beginning what I needed to do is I need to join up with a management company so that when they say because they used to ask me this all dumb who who's managing it oh dude I got a professional management company who is it oh that's good it made him feel all calm and cool it did mean they were any good he just made him feel good man check the box huh check the box okay we good he's good he's good we good okay that's good let's go okay let's get him somebody yeah once they give you money didn't they give you money a second time noon tonight can we give you some money now they call me up can we give you some money so so now here's the other way to do it but the other way to do it there's four ways for you to buy real estate for everybody watching the show because if you've seen anything today you've probably seen man there's a lot of damn work dude for a thousand bucks a month it's a lot of work it is a lot of work folks okay but i'ma tell you if you played this game right you think big okay these people these people that are calling about two units let me tell you something I started with two units now I got those kind of units four thousand of those imagine that four thousand and these pigs paying you every month pigs we call them all pigs I don't care if they're brand new we're looking at brand new stuff in in Houston Texas what do we call them Captain run piglets you know why we call it piglet six cuz they produce bacon all right wait coin point right some of these things are so piglet like like I'm I get cholesterol like my doctors like you gotta quit buying apartments bro it's gonna block up your vascular okay so look it all starts somewhere my first deal was 38 units my next deal was 48 units my next deal was 92 units my next purchase was 2200 units at one time it was like jump jump jumps yep my first deal was one unit okay my first single deal with my first mistake I don't ever talk about it was one unit seventy eight thousand dollars it was a waste of time and energy my second deal was a single-family house stupid even though I made money on it third deal 48:38 units fourth deal forty-eight units I'm like okay now this is going to work okay those when I started buying the units and Balcombe like this works so what he could do if he's qualified is you could invest either in your own deal number two a REIT I strongly advise you not to do a REIT because it does not provide the real estate investment advantages that real estate like this does okay you guys are invested in reach on the stock market that's not a real estate investment that's a stock it's a piece of paper it's garbage okay third thing is find a syndicator like who are subsidy caters captain Ryan real estate Ryan captain Ryan MC companies is one of them yeah upside of doing that wait wait points the second one yeah I mean I mean they just don't have any money in the deals so they go and raise all the heat he hates the idea he's got this real bad look on his face right now like he just ate like drank one of those bullets it's like horse racing you know it's kind of this kind of a crapshoot you know you don't know who the jockey is and you don't know who the racehorse is the fourth way is if you could possibly if you're an accredited investor invest with me in Cardone acquisitions this is our acquisitions company we started a fun we basically go out and buy real estate I buy with my money i buy only deals that I want my money invested in and then we allow investors to come in on top or ideal some of the employees that work here my mother used to invest with me my sister my brother my mom's not not around anymore so she's not a good investor even though she never bothers me okay I love my mom she's my friend and she would she would think that that joke was funny even though some of you didn't again because you take death more you make a bigger deal about it than I did okay so um look we want to help you I want to help you whether you can buy your own deal whether you want to syndicate a deal maybe you want to you want to learn Biya syndicator maybe you want to start a fun I want to help you in the real estate game if you're in a credit investor you can email Ryan Ryan at Cardona acquisitions comm if you have a deal you want us to look at and cover in one of our future shows email Ryan Ryan at Cardone acquisitions calm Iran at Cardone acquisition Scott would you learn today Ryan real estate Ryan would you learn today that you guys go first what you learned Robert no no captain Ron you're in the show not they're not well no I mean III learned that you know you have to you have to look at a lot of deals and you have to look at 50 deals so to understand the numbers I mean when one of the callers called in one of the things that I keep pulling out of these these these guys who are asking the questions and girls is you really have to know the numbers and one of the things you drill in on is hey what's your real Noy what's your real gross income what's your real expenses because if you don't know if you can't if you don't know how to analyze then you're you're you're thinking you're buying a good deal you're not poor thing this how simple this game is you find a deal how can you know if a deal is a good deal before you even analyze the deal how do you know it's a good deal if you don't know the entire market okay me and captain Ryan three weeks ago we drove I don't know seven or eight properties over there on the eighth property that we drove I said I like this place I like the neighborhood we went Nate breakfast in the neighborhood I'm like I dig this there's money here right I feel good you feel it feels good no no no no hope they don't shut me down for doing that that was that good right is that a cup it feels good dananananana and then what do we do second thing we did was we analyzed it okay third thing we did was we made an offer for after I knew I could get a loan on the deal the deal was 36 million dollars the bank would loan me 26 27 million dollars I needed nine million dollars in cash I had it I had the money ready to go I made an offer I got out bidded okay and then you asked the manager then you asked the management company cuz if the fourth one is managed yeah yeah what do you think of the deal yeah I had it under written by another bank okay we tried to buy the deal I went after the deal hard hard hard hard here's what I didn't tell you today okay at some point after you do those four steps you need to make a decision you're gonna buy the deal or not okay we made a decision to bail out of that deal okay I don't I don't want to be strangled by real estate I want freedom when I buy I want freedom when I buy it okay I don't need to chase it just because it's real estate doesn't mean you can make money with it and by the way you're gonna own this stuff for a long time okay you're going to have one year we're going to go in and fix a whole bunch of stuff is there problems in downside with it yeah promise you don't let the problems keep you from buying but don't let the the upside the possibility upside blind you to not know what you're doing okay if we can help you all you got to do is email me Ryan at Cardona acquisitions comm or GC a car down acquisition comm we'll look at your deal I want to make sure you don't make any mistakes if you're on youtube great subscribe there if you're on Grant Cardone TV and you can see the exact order of these shows subscribe their comment ok comment I will answer your questions there somebody doesn't answer your question if it's me or Ron don't answer your question right away call my office 800 three six eight five seven seven one call in any Monday I'm here to help you we want to help you oh yeah if you subscribe we're going to pick we're going to pick somebody to partner up with if you want to be part of their new real estate show if you want to be part of my real estate show subscribe to the YouTube channel under any real estate video real estate posted video comment that you want to be part of the show okay part of the show we're going to be in Houston Los Angeles and San Diego this month shooting for the new real estate show brought to you by can't tell you the network yet but I can tell you it's going to be called the big by Grant Cardone goes crazy nananananana we are [Music] Benjamin

Channel: Grant Cardone

Views: 441,610

Rating: 4.8842573 out of 5

Keywords: apartment investing, how to get rich, yt:cc=on, analyze real estate, cash flow, commercial real estate, how to invest, how to become millionaire, multi-family, grant cardone, passive income, manage real estate, find real estate, grantcardone, real estate, investing tips, finance real estate, how to make money, flip houses, how buy apartment, when buy home

Id: 6wfc0SZodCQ

Length: 60min 2sec (3602 seconds)

Published: Mon May 29 2017

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