Making an Offer - Real Estate Live Training with Grant Cardone LIVE at 12PM EST

hey welcome mundy grant cardone in the cardone zone and we are preparing for our annual forward slash summit real estate summit three days there'll be about 1500 people 1500 people millionaires billionaires deal makers lenders brokers dude i'm filling the room up with some of the the the greatest real estate investors lenders brokers jv's jv is a a joint venture um we have syndicators coming this is going to be the probably the most high quality group of people i've ever put together today we're going to be talking about how to make an offer how do you make an offer on a deal what needs to go with that offer we'll talk about the letter of intent your due diligence time things that can actually change the way the buyer i'm sorry the seller views your offer welcome to the show we do this every monday in addition to this when i'm done here today i'm going to go into our mentor call and answer questions for people that we're supporting up until the summit uh uh on what's the date july 26th 26th 27th 28th we have people coming in investors people that invest with us friends and family at cardone capital we have other real estate investors we have people that we joint venture with we have management companies coming in lenders coming in brokers coming in to meet for three days july 26 27 28 there's gonna be a lot of money in this room folks bring your deals bring a notepad uh bring your phone because you're gonna make some connections that you will need going forward in real estate remember real estate is not a is not a self-employment job like this is not a job you do by yourself this is a job you always do with other people so there's a lot of people in this game like uh just think this is you right and you you got you got this thing you wanna you're the buyer you're you're trying to buy something or you're trying to sell something and you got a guy over here that you don't know and right now he's got he's a seller he wants to get rid of his property you're probably going to have to put somebody in between this deal this is the broker everybody wants what they want you know you want what you want he wants what he wants he wants his two percent the easiest way possible he'd like to show the property one time and collect his fees and this guy wants as much money as he can get okay everybody's got their eye on the prize okay and then and then oh by the way you got this you got over here you got this guy he's got all the money bags i don't know how you do money he is the lender you got a lender over here oh yeah and you got this guy right here okay you got this guy right here he's the tenant oh i forgot another guy you got over here you got a manager over here and they're probably not watching the bag they just want their feet okay but everybody wants what they want right you got all these players involved reason i'm telling you that is when you write up your offer you need to keep in mind in mind the buyer the seller the broker the tenant and the lender [Laughter] and johnny hit the cash register now also there's another party involved if you're raising money okay there's the investor there's the guy you're going to get the equity from so who do you have now you got you you got the lender you got the broker you got the seller you got the investor you got the tenant and i think i did the lender oh yeah and you got the manager okay on small deals under say 30 units they're probably the the manager is going to want 10 your lender is going to want to know who your manager is by the way first question your lender is going to ask you once they ask you how much money you want if they're interested in the type of asset you're buying whether it's retail a shopping center or industrial or apartments once they say yes we definitely lend money on that deal and just because they're a bank doesn't mean they lend money on that deal they could lend you 20 million dollars to buy a jet and they might not lend you 20 million dollars to buy apartments okay different lenders do different things but once the lender says yes we want to lend you money on this 80 unit deal the next question they're going to ask is who is your management company why am i telling you all that because when you make an offer okay when you make an offer particularly these big deals the big deals that i do when i make an offer and you if you've read if you've been through the course how to create wealth investing in real estate if you've been going through the home study manual or the 16 hour video program you've heard me say okay you've heard me say when you make this offer you want to know ideally that this piece of real estate right here okay is desirable enough is desirable enough to attract more than one buyer if i have a lot of buyers show up here at the door right here okay particularly qualified buyers for you guys that are doing foreclosures reos um upside down deals you might have a lot of buyers here but they're all bottom feeders okay johnny comes out hey i heard you're losing your deal he's a bottom feeder dude he's looking for a deal oh by the way he won't be here six or seven years from now when you go to sell this asset follow me okay follow me the better quality the buyers okay the better the asset now the better quality the buy the asset and this is the one thing we talked about last week i said never ever compromise the asset you're going to make a lot of compromises to do a real estate deal i would rather see you compromise the price and pay more than compromise the asset value for those of you out there that have been in the real estate game for a long time listen to me i got an email yesterday from somebody who says hey i just i spoke yesterday to 600 uh real estate investors for about 50 minutes damon john talked to him jesse itzler talked to him and then i'm like okay hey what do you guys want me to talk about y'all i've had everybody talk to him well grant you actually buy real estate okay i said what y'all want me to talk about and they said get them excited i said dude you can't make money in real estate being excited you make money in real estate because you buy real estate and when you buy real estate you're going to have to make an offer and the higher quality the asset the more buyers that will be there and once you have a lot of competition for an asset guess what what you write in that offer what you write in that offer your loi which will become a psa letter of intent becomes a purchase and sale agreement if you have a bunch of buyers here and you have a seller the seller's got big wide eyeballs and he's like i'm going to get my deal the broker's got big wide eyeballs i'm going to get my deal and the buyer and the broker both know that the lender is going to be involved i'm doing a deal right now for 185 million dollars i had to compete with other people to buy that deal okay if there's buyer competition it's a good deal if there's lender competition it's a good deal if there's competition then your letter of intent and how you make an offer is going to determine whether or not you get that deal you're like man what are we talking about right now okay you found a piece of real estate you love the piece of real estate i finally talked you off the ledge yesterday i was in dallas talking to this group this group is still trying to buy 12 percent cash on cash this is for you old school guys they're still offering eight percent preferred returns to their investors this is what the guy's telling me he's asking doing a q a we did a q a uh with with my friend sumrock brad sumrock and his wife and um they were in dallas about 500-600 people there and i was so excited to do it because man the quality real estate investors are such a quality audience they're just such good people because they're investing not for money they're investing to create wealth and the mentality is completely different i'm not looking for a bag i'm looking to secure my bag and get long-term long cash flow for long periods of time so he the guy says to me hey man we do we only buy 12 cash on cash and 8 preferred and i said to him how's that working out bro and he's like well what do you mean i said you haven't bought a deal in four years have you he's like no i haven't when the market changed when the market changes okay you have to change you've got to bring this down and keep the asset quality up so he's like how have you done 600 million dollars worth of deals this year i said you can't if you're offering that okay today today this morning and i'm getting to the letter of intent how to write the offer okay and you're like man just get to it no but you got to understand why you got to be sure the letter of intent can you tell ryan i need those printed materials he went off to get them and i hadn't seen them um today today the 10-year treasury is at 1.21 percent so if you if you're willing to lock your money up for 10 years with no promise of an upside no deductions no write-offs no appreciation i'm going to pay you 1.21 percent and you could see that money back in 2031. and you guys are still offering 12 cash on cash and you're looking at garbage because the only thing that's going to pay you 12 cash on cash and an 8 preferred return to the investor and if you're going to offer that stuff you got to go buy some garbage assets and you got to make a promise to an investor that's going to choke you out which means you can't get the deal okay you got it for me buddy thank you you're the man you're the man okay so so when you write a letter of intent you found an asset uh can i show them this i'm gonna show you guys um i'm gonna show you guys a little deal i'm looking at right now okay don't tell anybody i showed you this i don't have the deal yet those guys are probably watching my show right now i shouldn't show it should i do one no this one i'm just showing you a deal i'm looking at right now okay you cannot invest in this deal right now but this is the kind of stuff that i look at okay uh give me h-town what do i put in where's the picture of it 15th street 15th street okay no it's too late so i'm going to show you this beast right here okay you guys with me right here look we they took this old build and converted it to this you see this monster now when i go buy an asset like that how many of you believe there's going to be competition on this deal look at that look at that look at that that is downtown houston ladies and gentlemen this asset will never be built there again 100 years from now that asset will be right there staring at downtown houston no one can ever build that asset in that location ever again the next time this opportunity comes around will be literally 100 years from now or 10 years from now when i sell it which i probably won't i'll probably just refinance the damn deal point is when i went to buy this deal i can't expect a 12 percent cash on cash but i could expect over a long period of time i could expect a 15 to 18 percent internal rate of return okay i could expect possibly a 2.5 to a 3.5 x return on my equity okay like i'm cool with that man i just want to buy the great asset now how do i know it's a great asset and how do i know what to offer because if i have multiple buyers on this deal all of which are quality buyers why do i want to know that because in the program it says know your exit when you buy you make your money when you buy how do i make money when i buy because i know that one of these guys that didn't win it will be a buyers for it in the future okay these need to be quality buyers though i need quality buyers the moment you get a quality buyer pool on an asset quality you got to be sure your letter of intent is freaking like uh uh fort knox okay so this is about your offer when i write an offer on this deal i'm on the phone with the seller in this case i actually got on my plane and flew to the cellar put him at breakfast sat down with him brought my letter of intent with me and said what do we need to say on the l o and the i i we sit there and crafted the loi okay the loi should have this on there's the loi which is really your offer okay okay price is the fir is one thing that needs to be on there okay uh due diligence one two due diligence three security deposits get ryan again i wanna be sure i cover everything here security deposits this is really really important folks you can underwrite as many deals as you want man you can underwrite them to you blue in the face if you don't make an offer you don't get a deal the number of offers you make will determine how many deals you get you don't get deals you're not a real estate investor just because you learn real estate read about real estate study real estate don't make you a real estate investor one thing makes you a real estate investor a deal okay you don't get a deal you don't make money everybody write this down you don't get a deal you don't make money most important thing is the deal no deal no dough okay so watch the price needs to be on there i asked him what does the price need to be he said in this case uh you know he's like hey man it needs to be 120 million dollars i think that's right can't remember when i paid what up oh no no no no no i'm wrong i'm wrong i'm way wrong okay okay yeah he told me hey man here's your here's your number the number needs to be you know he he gave me the number all right he gave me the number i'm gonna leave that off because i hadn't closed this deal yet i'd rather not be public information so he gave me the number says you need to be at this number for us to do a deal excellent don't make a big deal about the price price should not be the most important thing you're worried about most important thing you're worried about is what you got a deal okay now in that the due diligence i asked him what it needed to be i didn't tell him what i wanted to do i said what do i need it to look like he said 30 and 30. 30 day due diligence at which time your money goes hard this is security deposit or hard money okay some deals need hard money some deals don't need hard money in this market right now most deals need hard money nobody's going to really pay attention to if you're not going to go hard hard means i'm going to give you the money i'm going to give you the money and once that money goes hard i can't walk out i can walk out i can walk away from the deal but they're going to keep my money okay and i said what does that need to be i think he said two percent was hard money one and one basically one now security deposit and then another one uh at the end of the 30 days okay he also said hey i'd like to do an access agreement you'll hear this as you start to invest in real estate access agreement means we will start our due diligence we will start our due diligence hopefully you guys are enjoying this today these this is the meat this is the this is the meat on the bone of a deal okay and so when we go to the mentor call here after this show uh what i'll do is i'll answer your questions if i ran over anything too quick because i really truly want to be involved in your deals folks like i wish i wish we could do deals together you and i there's five 400 people on this call today that i know of and another who thousands of them watching online you know if there's two thousand three thousand people i did i did an event this weekend for five hundred people in dallas i did another one here in miami for two two thousand what 2500 people why am i doing all this last three days i've done three events on real estate into this month i'm doing another three days in a row with 1500 people why because people peop you need people for deals no deal no people no deals no deals no dough okay that's where i started the show today remember how many people gonna be involved a broker a seller a lender i never do a deal without a broker by the way and i never do a deal without a lender there's going to be a seller a buyer a broker a lender a manager i always use the third party manager and there's going to be tenants you got to learn how to get along with people you guys like i'm an introvert okay well that ain't going to work very well in real estate because you got to talk to people oh and if you're raising money if you're raising money now you got investors and then you're going to have a team at some point you know through covid our our collections in kovid went up you know why because we talk to our tenants hey what's up man you sick yet you heard you heard there you don't we we can't evict you did you hear about that good you want to play that game or do you want to pay oh no man we want to pay man you got to talk to people if you want to collect your rents so we our collections were as good during covid as it was before covet why because we talk to people you want to raise money you want to do big deals you got to talk to people at folks you got to talk to people you want to do great deals you need a broker you want to do great deals you need a great letter of intent so so ryan i got to have my price my due diligence security deposit access agreement access agreement means we don't have a psa yet we don't have our psa psa's purchase and sale agreement this is that legal document that we have in our resource book we actually gave you copies of this that i pay what do we pay 50 grand at least 50 000 per deal i pay a lawyer to work out the psa the other side pays 50 to 100 grand by the way to work their side of the psa so that we come up with one [ __ ] psa okay 100 100 000 150 000 will be wasted on a purchase and sale agreement and you guys are worried about man there's some linoleum in the bathroom that needs to be fixed man i need a 1500 credit at closing and oh by the way there's a gutter there's a there's a gutter got a sputter and i need a fifteen hundred dollar credit at the closing oh yes and by the way i saw some termites [ __ ] termites are good for real estate [ __ ] man termites bless the real estate with some cash flow okay i look for bed bugs termites and mold on every deal just kidding okay but you know you're going to have it in the next 10 years it's going to be there like i don't know why you guys get all excited like if i told somebody man i'm blowing out on a deal because of termites they'd be like yeah that's stupid bro like you just that's that's an amateur move okay so your letter of intent needs to include the price the due diligence security deposit access agreement is there an access agreement meaning we start now it'll make you sound like you're sophisticated hey can we do an access agreement i hate them personally but can we do an access agreement and they'll be like hmm wow this guy's sophisticated okay all right i want to do a one percent down i want to do a one percent uh uh security deposit today and i'll do another one percent that'll make you look like you're legitimate i'll do another one percent um once we pass our due diligence if you get through your due diligence period the 30 guys if you're going to do any kind of renegotiating do it before your 30 days is over and i and i would suggest to you that you don't do any renegotiating if you want to be in this game for long periods of time okay what am i leaving off here okay in addition to the letter of intent what am i leaving off oh yeah where your debts coming from are you going to get debt or is there no financing contingency most of our deals are done with no financing contingency so if i do a 200 million deal and i know i need 80 million bucks i'm a finance 120 my letter of intent will say no financing contingency i don't need the doe okay now in my letter of intent i'm also going to have a couple of other letters and these letters these letters the first letter will be a dear john letter okay hey dude i want your [ __ ] i want to buy your stuff i'm a cool buyer i'm an easy buyer i'm the best guy in the world you don't know me and i don't know you i've heard about you for years i want to buy your asset i'm going to tell them all this i'm i'm just going to blow him up about why i want to buy this deal okay by the way i've got 500 units in units this is my bio dear john um i probably shouldn't say dear john because it sounds like i'm leaving him huh okay but this is a bio letter i own 10 000 apartments this is why this is why many of you it's so important if you're going to do the summit grantcardone.com summit the real estate summit at the end of this month if you're going to do it virtual and you could change that right now you only have seven days if you could possibly figure out how to come meet me we're gonna actually start talking to people about how you guys could leverage my bio okay this bio letter will be this ten thousand units seven states uh almost three billion dollars in real estate what else did we say in this letter let me see did they write the letter up uh the line those deals we've done in the last 12. oh no i don't have the bio letter they didn't give me the bio that front page there that's the sum that's the rough draft no there's no letter here oh yeah grant cardone individually yeah but oh okay it's terrible so what we're going to do is we're going to show them that we're legitimate right we're going to show them there's a person okay i'm an individual owner anything and everything that separates me from the competition needs to be in the letter now diva if you don't have that you need to figure out how to get that whatever you guys can do just think about you're going out friday night you want to look good you guys take the time to dress right what's going to make me look good right dude same thing with your bio letter you got to make yourself look good if you're buying assets that other people want you got to look good you got to sound good we've done deals with okay like we have a whole letter those are all the sellers yep okay yeah so so i don't know what i'm looking at though so we just need to reform and you need to keep refining just what i'm doing right now looking at this as a buyer i'm looking at this as a buy a seller i'm like what am i looking at right here okay it needs to say here other people we've done business with or people you can call sellers we've done deals with if you guys don't have that you need that if you're like i've never done a deal before good then partner with somebody that has done a deal don't be stupid man why'd you guys go to college so you could tell people you went to harvard not so not so you could get smarter okay why do you go get a chiropractor degree so you can tell people you're a chiropractor why do people get a legal degree not so they because they want to learn law because they want to tell people they're a lawyer why does somebody get a real estate license so they can say i got a [ __ ] real estate license why do people go work for a company i work at goldman sachs okay so like same thing guys partner with somebody so you can say we've done this many transactions my partners have and i have done this many transactions okay so what does your letter intent need to be it needs to secure in the seller's mind that you are the person they should pick if they accept your loi and your letter right here and deals that you've done okay if they accept that they're also going to probably ask for your underwriting of the deal that is the seller is going to ask me how i've underwritten this deal why does the seller care how i've underwritten the deal because they want to make sure i'm not in la la land on my underwriting and then wake up 20 days from now and realize i can't do this deal so where you would think the highest offer would be the one picked you would be wrong in most cases the highest offer in these deals is not the one picked in fact the price can be so accelerated that they're like uh we just we had a deal last month they were like 30 million we didn't get the deal we came in second place uh how much was that deal i think it was uh so that was 250. it was 250 million dollars a group came in at 300 million another guy said two s two how much did we get bit out i think it was 270 270 okay we we came in second we were he he got the deal 270 got the deal and there was a group that was at 300. and the seller the broker told me hey we don't think the group at 300 is real we don't know them we don't trust it and we can't see how they would ever make sense of it because they know the seller knows there's going to be this and this is where i started the show the seller knows you guys with me you're tracking me the seller knows remember this image right here uh now remember this one that i wrote here making an offer remember this first thing i showed you today we got a seller with big eyes and he wants the bag we got a broker right here with big guys and he wants his commission and you guys you're the buyer okay this seller knows that this guy right here and this guy right here this guy also knows this guy right here has got to go get a loan and this guy's got investors remember the second page was the investors the tenants dude like everybody knows what has to happen to make this deal work this is a people game and your letter of intent your offer your due diligence the financing contingency the psa your bio needs to secure in the seller's mind particularly in a hot market like we're in right now okay it needs to secure in the seller's mind that you can actually perform on this contract so they can give it to you first deal is going to be the hardest deal you ever get second deal is going to be a little easier and as you get bigger and bigger they're going to get harder and harder they're not going to get easier and easier so i got 10 000 units now i just lost a deal to a guy that does not have 10 000 units in fact a guy that has not been in real estate this is his first year investing in real estate he bought nine deals this year this year nine deals so he's bought more real estate this year than i have he had a big capital infusion sold a company got a payout uh and then he walked into fort lauderdale miami says i'll take that one i'll take that one i'll take that one i'll take that one i'll take that one the you gotta you got some people that sold the new york mets this year they came and unloaded a billion dollars in miami they took the money from the sale the new york mets and 1031 in a bunch of real estate here paying three and four percent interest of three and four percent dividends so last thing i'll tell you guys you got to get this game right okay i'm telling you this is going to be the biggest game of your lifetime it will not be the company you have it will not be the book you write it will not be the stage that you took and impressed 500 people with your great speech i got rappers man reaching out to me man you got some game bro i've been following you watching your game okay i want to play your real estate game with you big sean hit me this weekend 13 million followers you know why because they know man you got to keep hustling to sell the music you got to keep hustling to sell the popcorn you got to keep hustling to sell the popcorn or the cars or the plumbing contracts or the hvac or the chiropractor adjustments how many damn bodies can you crack okay you can buy real estate until you're 95 years old and your estate could keep buying it how many think i'm gonna be buying real estate diva you're gonna be you're gonna be dropping me in a grave a box somewhere and and i might pop up i'm doing one last deal right now let's get us some cash flow okay okay hey ryan fix that letter of intent man yes sir throw in another 10 000. that's the other thing on your price on your letter of intent man guys don't worry about the price man okay look i just want you to understand this when you're making an offer on a deal let's say you're trying to buy a deal for four million dollars and let's say you think that that deal is going to pay you six percent 240 000 a year in free cash flow uh and you're going to have to put a million let's say it's going to pay you uh i don't know let's say you got to put a million dollars down on this deal to buy it you're going to get a 3 million loan this is an easy deal to do this is an easy deal to do this could be one of your first deals could be this size ought to be three or four five million dollars first deal that's what it should be okay and let's say this deal is going to pay you uh eighty thousand bucks a year in income cash flow okay eight percent let's say you're gonna make eight percent on this deal that's a very doable deal in every city in america without you guys compromising the quality of the asset you agree with that right i do easy deal to do like now if you're trying to get a 12 return you're probably not gonna buy anything okay if you've got to give eight percent to your investors yeah you could still do that on this deal and then do a split on the improvement above that but let's say you're gonna do this deal okay and you find something wrong with the property and it's 20 grand or or let's say this let's say there's two buyers in the deal that are each at four million dollars how much more could you pay to get this deal see you guys want to be the lowest price i don't want you to be the lowest price i want you to own the asset because once you own the asset it's gone the deals that we're raising money for today you will not be able to buy again for 10 years nobody will we're buying two deals right now in one of the hottest markets in the country it is an institutional quality deal text me 305-407-0276-305-407-0276 it's almost 200 million dollars worth of real estate irreplaceable asset and i'm probably 40 to 50 000 below replacement cost we talked about replacement costs last week so look if i love this asset could i pay another 50 grand huh could i pay another 80 000 i'm going to earn 80 grand on it this year okay so watch watch the difference between four million dollars and let's say let's say there's 40 units here okay look at the difference between 40 units at 4 million and 40 units at 4 million and 80 000. okay 40 million people like oh man you overpaying for your real estate yeah but i own it okay i bought a house i paid too much for recently now i own it divide that by 40 and i'm paying 102 000 a unit okay and instead of what instead of instead of a hundred thousand a unit what's the difference okay i get all this cash flow in the first year the first year i get it back but most importantly i own the deal so don't let price be the hang up when you write your letter of intent in let's just go over each of the items with the broker what does it need to say man first of all let's get the price out of the way good we got that one locked down okay second what does the due diligence period need to be three how much security deposit do you need four what do you want me to say about financing here you know financing or no financing you guys cool just ask the broker he'll tell you okay hey grant and this is ryan secco in the background you can hear his voice just just just to stress how important that is because i think people look over that you had just said go over with the broker all of those key points a lot of us when we first start out we think we have to go over those points by ourselves yeah you you just said go over with the broker so so all everybody listening the broker broke the broker says goes to broker and ryan says okay you need yo send me a letter your letter of intent okay good let's do that right now what do you mean help me write it up okay what does the price need to say uh whatever you're gonna offer what do you need to say what does it need to say for me to get this deal man okay he's on the phone with he's he's talking to four or five people look it might not even matter what your letter of intent says because he might have already picked a buyer he might just be telling you to sell it sending a letter of intent so he's got his little freaking offer so he can go to his seller and say i tell you i get seven offers dude they already pick smith you understand they already pick somebody like if i if i'm on a deal let's say i'm on a deal and you guys are on the deal okay and we're all trying to buy a deal there's 446 people trying to buy this one deal i'm gonna do everything i can to make sure they're not even thinking about you guys i'm gonna be like who else is on this deal oh 446 other people are on this deal okay good out of the 446 people on the deal how many are you taking seriously other than myself okay uh well well i i really like george costanza he's here every week guys for real got good questions and and this and we got this new chick diva we don't know of her but she's she's she's kind of like her offer is so compelling like she's like paying 2 million too much we don't know who she is we think she's a freak okay but but we got to pay attention to her because her money's coming from some guy that just cashed out of this deal and we got a great letter from and goldman sachs has already sent a letter saying that they're going to fund the deal for boom new player on the scene with a big resume okay okay so it's not 446 people now it's down to what three people me george and diva okay hey if you were gonna pick somebody right now well grant i'm not the guy picking well who's doing the picking well boone is going to be doing the picking okay well dude who's boon like let me ask you a question has boone done business his boon done any picking his have i done a deal with boone no has has diva done a deal with boone no has george done yep george did a deal with boone oh you got a problem because they're gonna go look they're gonna go back they're going to go back to where they they did a deal last time but at least you know where you need to spend your time energy and effort exactly or you need to pay more than georgia bay guys i don't mind paying more to get my deal all i need is to do is to get one deal with this group okay in the beginning you may have to pay more to get deals and i promise you it will not matter as long as you don't over leverage your deals and as long as you don't compromise the asset the assets location if you got a great location if you say man i got a great product i got a great product here it's beautiful but the location's sick or i got a i got a i got a product over here that's not as good but the freaking location is stupid dude i'm always gonna i'm always gonna compromise the quality of the asset to have a better location that's why if you guys look at like the deal i'm doing right now the only way you get to see what those deals are you call 305-407-0276-305-407-0276 we'll show you the deals if you see the location you're like you got to be kidding man that's ridiculous okay stupid location when you see it you'll be like i completely understand if you live anywhere in the 713 what's the other area code over there if you live anywhere where beyonce grew up 732 or 832. i mean 713-504 not the 504. anyway you guys get the point um end of the month july 23rd 24 20 no 26 27 28 281 the 281 346 346 713 and the 713 832 and the 832 those are houston area codes i'm two miles from downtown three miles from downtown can access the galleria in six minutes and i'm in the coolest neighborhood in houston texas so we've been trying to buy that market for a long time there's six million people there man and when this market swings it swings hard they they have this year after covid they had 23 000 vacant units in houston texas 14 000 of them are gone 14 000 50 of the 23 000 units were absorbed in the first half of the year that's a good sign okay so okay a lot of questions here my name's grant cardone i do this every monday some of you some of you decide to hang on and ask questions at the end of this that's our mentor program if you want to get involved in that grant cardone.com summit grant cardone dot com forward forsyth summit will start the mentor program by you showing up in miami at the end of the month 26 27 28th three days in miami to discuss real estate real estate investing underwriting there's going to be brokers lenders and investors in the room right now we're looking at about fifteen hundred people that will be here live another two thousand three thousand people online if you can travel for this event do whatever you gotta do man you gotta get vaccinated do whatever you got to do to get to this event you don't have to be vaccinated to be here by the way you know what my vaccine looks like looks like that i walked in a place the other night they like you vaccinated you know what that stands for [ __ ] you in europe that's what that stands for it's backwards okay or is that australia where is it when you do peace sign like this i didn't know that i did this at the turnberry one day i'm like a guy was like hey man you you cut me off i'm like cool bro he's like he came jumped out of his car man furious can't believe you did that man it's australia when you do like that it's really the middle finger i'm like bro bro it's fine bruh i said it's fine man i really didn't know that i said if i was going to give you that i'd give you that straight up you know what i'm saying okay all right guys i hope you had fun today uh if you're watching the cardone zone every monday and you're on youtube man hit the like button uh you know hopefully hopefully you got something out of this show but mostly hopefully you walk away from the show said man real estate is something i could do you don't have to go back to college you don't have to get a degree you don't have to get a damn license but you do need to do two things you got to learn the game and you got to learn that it's a people game you got to get around people to play this game and the thing about real estate people you could take an introvert a total introvert in real estate and ask them one question about real estate and then you will not be able to shut this individual up just like me for the last 41 minutes just keep running my damn mouth okay because real estate's a cool topic man everybody likes it it's hot everybody has to use it you're going to live someplace people people live in raleigh north carolina they see all these apartment goings up you're in dallas you see the apartments going up you come down to miami you see it you go to new york city your apartment there you get something this big and you're paying 2500 a month and it might not even have a toilet that works okay so letter of intent man you got to work it out what is it going to look like it's your sales pitch to the seller it's your sales pitch to the seller and it needs to be stacked with a sales pitch price is the least important thing in the deal financing matters closing time matters due diligence matters and anything that you already know about the property hey guys we already know you're at 88 we're cool with that we already think interest rates are great we're cool with that we love your property i'm glad you didn't put a new roof on it we got a 125 grand plan for a new roof we've already rewritten our taxes they're going to ask you all this stuff we have we have our debt at 55 not 75 percent like like you need to cover anything and everything that would freak the buyer the seller out okay grant cardone i'm gonna stay with my mentors now if you haven't signed up for the the real estate uh uh three-day workshop come man it's only seven eight days from now come down to miami i guarantee it'll be worth it to you okay if it's not worth the deal i'll give you your money back grantcardone.com forward slash summit grant cardone.com forward slash summit i said what is it 9.97 for a ticket tell you what 9.97 for a ticket and when you get there when you show up i'll give you a 10 dollar real estate program if you sign up during the show today okay thanks for watching today let me go do my mentor work now okay the real work starts next okay all right guys how's everybody doing today um let's start johnny how we want to do the the questions here okay let's go to larry larry bloomquist and then and then and then right after that we'll go to helene roche [Music] grant can you hear me yes sir i can all right uh i know you hadn't spoke about 1031 exchanges a whole lot part of your your module on that i've done some studying on it i'm selling an office building looking to do a 1031 i've identified a couple items uh uh one's residential the other is an office building uh give me your your thought on 1031s anything i need to look out for yeah so so here's the deal on the 1031 a 1031 exchange how big is your building larry what are you selling uh 2.3 million so that's the total sale price that's total sale price and then what is your debt on that building zero oh okay so what he's going to do is he's going to take the 2.3 million dollars and he's got to exchange into something else that is at least 2.30 uh zero one i think some some amount equal to or greater than what you had okay uh and then he's got 45 days of 45 days the two things that are important here is a 45 day and a 90 day 45 days to identify but 90 days to close okay so a total of right total of don't you understand larry total of 135 yep total of 135 days to get this deal done so if it's if it's july the if it's july the first today he's got to close this thing out in 60 60 that'd be july august september july august september 15th so the first let's say it is september 15 i'm not saying it is whatever 135 days is 135 days from today to then i'm going to write down okay i got to close this boy bad boy out if the deal's already done i got to close out close out the lip take delivery of the asset by september 15th no later i'm going to actually go all the way out and then pull my numbers back because the timing of this thing's really really critical you can actually do a reverse 1031 if you uh purchase the new property before you relinquish or close on the relinquished property or you can do a forward 1031. it's a little more expensive to do a reverse but so i could identify and actually close on something now and actually do a reverse 1031. yeah good so so have you closed your deal yet uh no my relinquished property i'm not closing until november 30th okay maybe another month so so now the problem with the reverse okay we'll show we'll show this thing to you both ways uh you know larry still got to come up with some money right to buy a deal today you need 2.3 million dollars so now you got 2.3 million dollars on a deal that i don't know that you even bought that deal had you not sold your deal right is that right that is correct so now you're starting to play some freaking like mystery games that's the problem with the 1031 the biggest concern about the 1031 for me i've done i think i've done i don't know 12 or 13 1031s i don't talk about it much because it's not what i'm doing today i wish i'd never ever 1031 anything you know even though it may be extremely it did it was a good thing for me because i was preserving any kind of tax base but i wish i wouldn't have sold those assets is what i'm saying like to me like i don't know what your deal's worth clearly somebody thinks it's worth something where's it located larry the one you're selling austin texas oh my god probably the hottest market in the country it's pretty hot and and you know elon musk said it would become it would become the biggest boom town uh in america for the last 50 years yeah the thing i'm looking at is an office building i know you like apartments but there's an office building it's got a it's 2.5 million and i can get it i can do leverage i can get a note for the balance over what i'm selling mine probably for but it's a 6.1 cap rate uh it's leased out already through 2025 2026. um yeah so so larry let me ask you tell me about your deal though tell me about the deal you're selling because the thing that i regret doing because of the 1031 is that i sold any of the assets i had i shouldn't have sold them i should have keep accumulating assets so what's the deal with the one you have why are you getting rid of it it needed a lot of work okay a lot of work which i'm not afraid of trying to remodel and do creative office from that but i found a buyer that i knew and i think i got a really good deal before covid um and right now i think he's got it uh leased out but yeah i mean i've i struggled with whether to sell it or uh unload it but you know like i said austin's hot this is a good time to sell and i would i think i got a good deal on it but i don't want to pay the capital gains so i'm looking to buy something else yeah because one thing you could do if it's worth 2.1 million dollars i mean you could refinance that property it's paid for you could probably pull out 1.4 million dollars conservatively i don't know what the cash flow is on the deal who's the tenant there is it you or somebody else uh it's a company that actually sold so i don't own the company anymore i sold the company but i still own a building yeah do they want to stay there as a tenant no they had to move they needed more space okay you do you have a tenant there at all well like i say i've already under contract with somebody else to purchase the building okay okay so you're already done down the road so um so yeah so like i understand man i just bought an office building if you're gonna get a six and a half cap rate on it on a two and a half million dollar deal just know that that's the asset the thing i don't like about the 1031 is they're like you can have three identify three properties in this 45 days everybody thinks that's cool to have three properties identified it's not cool to have three properties identified okay because which one's the one you want there's only going to be one you want you're going to want the first one and if you lose the first one now you go to b and c why just to do a 10 31 what's the most important thing in a real estate deal is the deal i don't want to be stuck with b or c [ __ ] i can barely find one good deal right now much less three of them so it's like you go into a club and you're like okay i'm looking for three chicks here tonight okay i'm gonna take a b and c or three guys or whatever you want okay okay and what i'm gonna walk out with see who wants to say that so you understand you don't want this deal so why am i looking at it i don't want that deal why am i looking at it okay so you you you the the 1031 starts forcing you sometimes to buy stuff that you might not have bought had you not been in that 1031 or accept stuff too like you may find something in due diligence but now you're backed into the yeah you're back into it because because you're going to start your due diligence today and then you're going to find out 30 days from now with only 15 days left to identify but if you think you've got a good location you've got a decent cap rate with some appreciation why not do it i would just lock down on it i wouldn't jack jack around with the 45 days the 135 nothing i just drop i'd drop in on it bro close that deal and and i would definitely larry i don't know which what your problem is with debt probably because you're an old school guy but i'd love that i don't mind i could buy this two and a half million dollar property and also buy another couple million dollar property well go gangster up dawg go ahead tupac yeah okay hey hey hey larry don't be staring nickels down man yeah j j just because i see a lot of 1031s the uh the the biggest the biggest goof is that people when they sell their their their current property they don't put it into like an ipx 1031. it has to go into a third party 1031 exchange accommodator yeah larry knows what he's doing no no i'm just it's not just for larry it's for everybody on here yeah yeah yeah yeah yeah so basically larry cannot accept any money out of this transaction nothing no fees no money he can't take a nickel so he needs to take this money when when the seller closes the money needs to go to a third party called an accommodator that holds it it's very simple you guys don't even need to worry you just need to call somebody and say how do i do a 1031 exchange and they'll walk you through it and it's not even that expensive that being said don't sell real estate right now folks buy it refinance it and buy some more real estate okay larry hope that helped let's go to helene roche helene how you doing great cute good to have you here buddy great um i have a question for the summit yes ma'am just to make sure are you going to partner with people even if it's not in united states uh yes possibly possibly exactly and if you're not there's going to be maybe other people that will partner with me possibly like like it depends on if your deal is attractive like if you're telling me about you know it's sure it's undeveloped land with a plan to put a city on it which i've had pitched to me by the way and it's going to be developed in the year 2051 and granted only needs 52 million of which won't cash flow for the next half a century i'm like well probably not going to buy that deal but but look if it's a great deal and people can understand it there's going to be money in this room all right another question is to get some tips because i don't have any asset yet and i don't have money to put in because i'm really starting any tips to present myself to well someone like you yeah well like what you're doing right now like you need to come with your you need to work out your bio and you need to work out your story and you need to work out why i should do this with you guys i don't you know i don't find people that have money more valuable than people that don't have money like it you know in fact i don't i don't hang out with a bunch of people that have a lot of money what i value what i value like if you guys see who i hang out with on the weekends it's not people that are like they got a bunch of money it's mostly people that are willing people that are responsible people that are ethical people that are fun and people that know how to go from fun back to work like we can have fun for a second but i don't have fun for long periods of time i have fun for moments and then we're back to work again so so um that's what i'm looking for in my life i'm not i don't i'm not trying to partner with billionaires and i would i would but most of the time they're not they're not that easy to partner with because they're not really like they're they're going out on their yacht and [ __ ] so so and some of them are just hard to deal with okay or they're on their other projects so i'm looking for people that are willing people that make the time not people that have excuses by the way i have more people oh man i can't make your three days man that's why that's why life never gets better for you because you don't make time you make excuses i don't want to make excuses no i don't mean you i'm not talking about you i'm talking about everybody listening okay but the most important thing is the deal here's the deal guys and you cannot you cannot if you have a deal if you have something and then you can't raise the money you don't actually have a deal if you have money and you don't have a deal you can't make money so like the deal is everything if you have a freaking unbelievable deal great and the broker wants to come to with me for few deals i have is it a good idea for you or not the broker it's a better idea for the broker than it is for you okay perfect and uh last question um unfortunately unfortunately a lot of these brokers you know what these brokers do most of them what do they do bro what does broker stand for right uh probably broker than you are broker than you are is that offense that's wrong but you know a lot of these brokers do they all they want to do is hang around real estate people and go to real estate like just real estate brokers i'm like guys get out of your office and come talk to people like me perfect we had a group of lenders this guy cold calls on my office like three times comes into my office what do we borrow from them last year uh who uh israel yeah uh i don't know everywhere i go these guys show up in my face over 200 borrowed 200 million dollars from these people because they caught they got in my face okay hope that helps i hope to see you there helene where are you flying in from quebec love that city man what a great city i got to get back up there it's been a long time since i've been there okay hey let's go to valentina in her cool shades and then we're going to go to kali uh kalia kalia okay valentina what's up hi grant thank you so much to doing this for us i learned a lot my questions i don't want to spend your time a little quick and faster yesterday i was in the training watching second time and i miss one part um for the lender you say lender you can borrow the money from the lender and the transaction actually which you're going with the bank i have equity of the property so i'm gonna take the equity of the property and bank is gonna give me a money so how quick i can do so i'm down losing because lender is like 10 right they charging you how the transaction is gonna be uh i didn't understand this part this is my question with the langer lender uh lenders so yeah what what is the question what what is your question though oh i'm sorry okay my question is uh how you can do the transaction with the lenders for example you borrow the money from the lenders to put the down payment because if you don't have enough enough cash flow to put uh the down payment for the buying property no no no no no no i i think you must understood me so if the deal is a million dollars let's say the deal is a million dollars and let's say the deal needs 250 000 of equity or cash okay so that i can get a loan of 750 dollars now some of you could get a hard money loan right here you could borrow this money from friends family mom dad the banker doesn't really love that idea the bank is going to ask you how much of this is your money like they even asked me today on my deals how much of that is your money they're going to want to see your bank statements they're going to want to see your bank statements dude they're going to be like where'd the money come from you you've had no money in your account and all of a sudden 250 shows up there like hey that valentine that ain't your money that's grant's money so you you need to handle that now see we're back to the same thing i talked about people man you got a broker you got a seller you got a buyer you got a lender you got hard money everybody knows what's going on here and they're like valentin where'd you get this where'd you get this money from well i got it from my boy gc okay that's cool just tell them yeah man tell them now they're going to want to know who's gc and now gc they're going to be like let's put gc on this loan too then so everything gets a little complicated but but guys it's worth working it out i'm gonna tell you something okay while you might think this is complicated [ __ ] it's still better than going to college for five years and borrowing money bed bugs termites my mama told me my mama almost talked me out of getting in real estate oh you're gonna have all these problems you're gonna have tenants calling you have toilets backing up you're gonna have termites i'm like sound [ __ ] great to me because if you got that you own real estate it sounds great to me i'm gonna hire ryan let's go sounds good to me i'm gonna hire ryan he can take care of all this he can take care of all that stuff so let's get a deal done valentina let's make it a big juicy deal big big bad ass deal too okay everybody here let's do some deals together folks yes girl okay thank you so much all right and then kalia kalia how are you doing hey how you doing grant come on come on girlfriend how you doing queen my name is actually khalilah i know a lot of people are probably looking at how do you say that colleen talila so i'm actually um in mcdonald georgia i actually had saw a 40 unit apartment complex that's up for sale for 5.2 mil and the cap rate is at 5.2 percent man that sounds like a good deal to me sounds like a really good deal it's in the west side west midtown side of atlanta um i'm very interested in the deal i don't have like a whole lot of cash but i'm just willing and i have i'm a thousand percent committed yeah how much cash how much cash do you have how much cash i got 15 000 okay so look you on this deal you're going to need you're going to need at least 1.5 million dollars to buy this deal to finance 3.7 million this deal will get a loan if this is a real five cap one thousand percent guarantee it'll get a loan so when you write your letter of intent okay back to the show today the letter of intent with you is going to have to be okay you're going to have to you're going to have to make you're going to have to make them confident you can buy the deal okay your first problem your first problem is not going to be buying the deal your first problem is going to be the investors that are going to give you the 1.5 million dollars now if i were you and this letter of intent concept expands beyond the deal but could also expand to your investor base so you're going to go to your investors and say look i have fifteen thousand dollars to my name and a five million dollar piece of real estate that you need to be involved in and i'm willing to put my time my energy and my two kids and my fifteen thousand dollars in the pot okay even if you don't have kids you might wanna just throw them in for the dramatics all right so because what you're trying to do is you're trying to tell them right now i'm all in i'm all in okay everything i have i'll give you my computer i'll give you my shoes i'll give you my children whatever you want and my 15 grand my last 15 grand also got some life insurance i got like 40 000 worth of life insurance i'll sign that [ __ ] over to you and my tercel got you the point is you don't need a bunch of stuff to convince people as long as you're willing to throw all your stuff in the pot it's terrifying to people if you ever don't have nothing to lose i don't have nothing to lose right now so i'm willing to do well no you do have something to lose you have something to lose you got this stuff to lose that's all you got left and if if you tell me you're willing to lose everything you got i'm like [ __ ] this chick is she's all in man she's committed she's crazy okay she's committed or she's crazy or maybe she's both okay so now look that's cool to me that gets my attention because if you're willing to throw down i might be willing to throw down with you most people that are trying to raise money for deals you guys want to do it with no money mm-hmm you don't want to do it i have two investors in mind especially family members yeah you need to get you need to get you need to get like 20 investors in mind and you need to get way way beyond your family exactly okay i'm just saying you don't want to be talking to your family because sometimes your family don't take you serious because they remember when you were seven i got you but if your family members got money you tap in but if they got money you need to lean on them because if you can't man you can't do your friends and your family who can you do exactly so i used to have this cousin i used to have this cousin and my mama my mama said why are you kissing your cousin i'm like [ __ ] if you can't kiss your cousin who can you kiss got to practice on somebody exactly exactly so let me get this straight so you said that i i have to come up with 1.5 mil to i guess as the down payment right yeah because look look in a deal what do i say the order deal okay debt there's your debt right there i know for sure i can get you this loan i i can i can show you who to talk to to get this loan you're going to need a management company on your deal to get this loan which is not a problem the management company that's that's not a problem this loan is going to be easier to get for you than this so the second thing is the debt the third thing is the equity now you got a friend that can help you with the debt i can help you with the debt meaning i can hook you up with people that lend money this is what they do for a living you have to either come to our event i got a buddy of mine named alvin alvin would probably do this deal with you he knows your market this is what he does uh you know you guys would kind of figure out some kind of transaction fee some something to keep you involved in the deal mm-hmm um my buddy dale did i put in that i got in business dale managed the deals he had no money in them not even 15 much less 15 000 but he stayed on the deal and got equity on the way out when we scored he had he had a piece of the score he didn't get anything until we scored so alvin come come to my conference are you coming to the conference yeah i've already got the ticket okay good good come there man come there and make sure you meet people on the brakes okay and brian go ahead but just remember the number one thing that grant circled up there is the deal so make sure you write an loi on the deal make sure you get the deal under control and and work with the broker because i know there's a lot of questions that are coming out of this chat the most important thing is writing offers on these deals because this deal may or may not happen but you want to come to that event with an actual deal that you control and you don't control a deal until you have an loi or a psa with that deal under contract so look leonardo says i have a deal george costanza says kalila kalila dm me i may be able to help you this is what happens this is what happens in when you put a room of real estate investors together yesterday sunday five o'clock in the afternoon i go on a call with 500 people people like why would you do that uh because there's real estate investors there well it's not even your event uh yeah it doesn't need to be my event man i need people this is a people game folks real estate's like a big bus and the bus was the bus was designed or a big dinner table real estate is where everybody can eat together you know it's not about it's not about you keeping all the profits for yourself it's about how to share the deal with a lot of people let's go to jamie conceal calcito uh and i'll see you i'll see you kalila if i'm pronouncing your name right i'll see you in miami okay jamie what's up hi grant how you doing sir good looking forward to going to miami good good look for the scene and uh the summit all right uh same deal all right let's keep on with the same deal ashley was talking about what i'm not getting clear here is you mentioned uh giving uh people giving your investors a 10 return on their under investment i run the numbers on this same type of deal and after free cash flow i'm getting about you know six seven percent return there's something on the numbers not only and nodding adding up there so what what is it so you're doing a deal what deal are you doing or are you you're doing math on somebody else's deal i am i am doing math on multiple deals okay well let me just do the deal let me just do you the deal that she just talked about okay she said this was a 5-2 cap okay on a 5.2 million dollar deal that means this deal is going to make let's say it's a five cap and not a 5.2 2.5 times 0.05 the deal is going to make uh 125 000 a year so how do you do the math on this deal okay let's see what the return is a five cap is probably in today's market going to be almost a 10 cash on cash let's just find out if it's true or not how much is the debt right here this debt 3.7 million dollars where we borrow money i don't know where you guys borrow money again another reason why you want to come to the summit find the cheapest money in the universe i went to dubai to get some of this money before i flew all the way to dubai long flight 14 hours in order to think that maybe i could meet some people with more money than i had that could lend me money hey boss what does this money cost so five million dollars five million bucks yeah five cap is 250. oh it's 250 yeah so if if you're buying it for five million out of five cap yeah it's 250 000. 250 thousand dollar cap uh uh cash flow noi that's the noi on this deal is 250. what comes off the noi and again you got to learn how you how you underwrite a deal underwriting's not in a letter of intent but it's going to influence a letter of intent okay so uh i have a 103 000 in debt interest only debt if i was born money like that some of you can do that some of you can 147 thousand dollars of free cash flow what did i put down what did i say i was going to put down divided by 1.5 million dollars and that's a 0.98 return how do i know that okay that's how i do the math how do i do that because she said there was a five cap how did i immediately say i was going to get a 10 return on my money because if if i'm boring if i got a five cap and i'm borrowing money at two and a half percent okay basically basically i can double my cap rate for my cash on cash okay how does that math work it's simple it's so simple this 5.2 million dollars is the price this is the this is the equity i'm not borrowing money on this okay i'm not borrowing money on this amount right so i'm boring boring this money i'm boring for 2.8 percent and she said it's a 5 return i'm using somebody else's money to make 3.2 percent right i'm making 3.2 percent on magic money it's not even my money like so so a third of this i'm using as a down payment i could pay this guy eight percent and say hey give me my 1.5 million dollars i'll pay you eight percent he can't get that anywhere in the world today that's double what a junk bond would pay him six times five times what a treasury bond would pay him okay eight times what an apple dividend would pay him he can't get this anywhere man his bank his bank this is 80 times what his bank pays him you understand so you guys got to learn how to sell this to an investor i'm getting five percent i'm gonna keep the rest okay so what am i doing i'm basically borrowing a bank's money at 2.8 percent and i'm making five percent on that money so i'm making three point percent three point three point two percent on no money the money's invisible how do you get rich opm boys and girls opm is not investors money it's using the bank's money okay so this is what the banks do what do the banks do when you take cash and bring it to the bank the bank pays you what a half a percent and what do they do they lend the money out they lend the money out at four and five percent and everybody's like how do banks get rich uh opm on the spread but but what a bank does what you guys should be doing you understand that the bank you take the money you take the money you put it in the bank the bank gives you let's say one percent and they don't they don't give you one percent and the bank takes this money and they give it to another guy they lend it out at five percent see that four percent let's say that was a million dollars 10 million 100 million dollars billions of dollars but the thing that you guys don't know or maybe you do one two three four five six seven eight nine okay they get to do this nine times okay so they get they get a thousand people that give put in a million dollars each they got nine million dollars they lend that money out nine times each one of those down payments or that savings account and then they make the spread on the difference and that's how you create wealth it's called leverage you can't be a bank because banks are monopolies but you could buy real estate and the bank this is where you get to use the bank you get to twist it off in the bank in louisiana we call that the old twist off what was his name again uh gentleman's name was jamie hey jamie and also you were saying some of your deals that you're underwriting you don't get to a 10 well usually the quality of the deal determines like like if you buy a nicer newer deal you're gonna buy it at a 2.5 a three a three and a half cap rate and so your leverage isn't as positive that's what grant was going over so you may only tell your investors hey you're going to get four five six seven whatever the deal does that's what you want to tell your investors but not all deals the same not all deals are going to do 10 let's say we got a deal that's got a uh let's say we got a deal that's got a four cap it's 10 million bucks it's gonna pay out it's it's four hundred thousand dollars worth of uh noi is your noi on the deal okay your debt on the deal is going to be seven million dollars in this deal that's 210 000 so i got 190 000 of free cash flow uh and i had to put 3 million dollars down what's the return take 190 000 divided by 3 million bucks and i have a 6.3 percent cash flow okay you're like how do you do man how do you know all this dude it's just math it's the same math every time by the way if you don't understand and and you got a lit you got a an investor that wants nine percent okay bro be cool bro be cool man everything's good man we going plat we going platinum okay so how do you get there well you got a 10 million dollar deal you got a 10 million dollar deal and let's say this 10 million dollar deal is 150 units and you know the rents can go up 200 bucks i mean you had to find there was some reason you wanted to do this deal 150 times 200 you're like those deals are impossible to find are they are they impossible we just closed them one last month no they're not we raised the rents 430 days without doing anything without doing anything times 12 okay let me just see this 150 units i found a deal i found a deal that i can raise the rent 200 bucks on i don't know why location mismanagement last guy didn't need to they're lazy i don't know why how do how could we raise the rents on this deal and they didn't do you know it's it's a pure people and management play yeah sure okay if i could raise the rents they weren't 150 bucks a month they weren't asking for them they weren't asking for them right so if i can take 150 units raise the rent 200 times 12 jamie that raises the rent the income on the property by 360 thousand dollars if i can only keep sixty percent of that for whatever reason that's two hundred and sixteen thousand dollars a new noi okay what was my old noi my old noi was uh uh 210 000 no no it was 400 it was 400. my old noi was 400 grand okay now i got to now 616. 760 right no no 616. it's not right yeah i said my it was a four four cap there's a four cap so that's 400 000. that's my debt right here this is my debt this is my cash flow okay okay so watch so i increased the rents my old noi is still there here's my new rent this is my plus i'm at 616 noi 616. i'm gonna divide by the same four cap that i bought it for jamie you following me you're tracking me i'm okay 616 divided by .04 and i'm gonna sell the deal again and now i'm gonna sell it for 15.4 million dollars how much should i pay for it what did we say we paid for this deal the purchase price was 10 million we put 2.5 down 10 million dollars is what i paid for it now we got 5 million 400 000 profit okay would you all put down on the deal i put down three million dollars okay i paid the guy six percent a year six percent a year for three years he made 18 on his money while he was in the deal on cash flow i said keep it all son keep it all unless me and you go 50 50 on the uh the uh uh other other okay so you made 5.4 million dollars you paid him out of cash flow jamie you with me yep okay he's like dude i got six percent you got six percent to wait for this and me and you make 2.7 million each okay he makes 80 98 on his money and what did you make you made 2.7 million and you didn't have any dough in the deal bro you got you you into the infinite return okay you guys can't track it can you like man i don't know you guys need to spend as much time with me as you need to spend with me in order to figure this out okay when i spit this at ryan how long you been with me now seven years in the beginning he was just like you could be here it's like telling me how to fly a plane right i'm like hey bro i don't care about flying a plane i do this and i do that i said great i'm gonna do it from back here you know so so you just gotta keep doing it you gotta guys keep keep doing it keep doing it keep doing it until until you're doing it there's only one reason you guys don't buy real estate because you don't completely understand the game yet because if you understood it the way i did the reason you don't find time for it is you don't understand it by the way the reason the reason you guys you the reason you guys spend more time doing stuff like mowing the lawn cleaning the dishes hanging out with the kids it's because you know how to do that stuff people do what they know how to do and they avoid the things they don't know how to do all you got to do is increase the knowingness once you increase your knowingness promise you i promise you you will buy deals go ahead ryan i'm just going to say you've looked at so many deals the analysts want to write the deals the banks will underwrite the deals the management will underwrite the deals and you get within based on your math year grant you get within tens of thousands of dollars on even some of these bigger deals so this math right here even though it's freestyle your precision is is incredible like like you could give me a deal like i've just i've done so many of these on a napkin and i don't need to be right like i'm not trying to be right i'm trying to i'm trying to just get close and other people are spending hours on excel spreadsheets and checking this out am i okay rent times units times time plus time equals appreciation this is not any more complicated than this okay will the rents i asked some people last night on a call 2030 if the rents are 1500 bucks today and today's 21 man if you guys could just fill in this block right here the riddle here's the riddle for you if the rents are 1500 and 2021 how much are they in 2031. just throw it in the chat what do you think they are and if you think they're going to be lower put in lower okay look at the numbers here three grand 2100 scott you think they're going to be 2100 okay that's 600 that's i i got it 2500 25 33 3 thousand gunther thinks they're gonna be 300 i don't i don't think she she she 2500 200 2500 3022 look how many people think they're going to be double okay the most negative person here is jessica she said they're only going to be 1850. what's wrong with you jessica what's going to happen to housing prices 3 200 3 grand 1 1900. there's natalie another negativity person 2500 i'm just kidding with you guys by the way uh you got to guess something 1800 to 2200 jd says 1800 i guarantee you guys i'll guarantee you in 2030 you will not find be able to find 1800 rents those would be that'll be affordable housing 3000 fifty three thousand no no gunther said it was a debbie said it was a a typo twenty five hundred three percent annual growth would be nineteen fifty a year somebody said if it was just three percent a year three percent times 10 that's 30 1500 times 1.3 yeah put it in 1950. there's no way you no there's no way it'll only be three percent a year by the way what'll happen it'll be flat i've been saying this for two years it's going to be flat i said it would be flat through 2019 2020 and then bang there'll be a spike and that's what we're going through right now we're already seeing some markets at like 9 9.1 rent growth so when you take 10 000 units that's why i'm so like i tell you guys the number of units is the most important thing because that's your multiplier 10 000 times 1850. pick any number that you guys got if i just stay at 10 000 okay and the rents go to 2500 okay that's 650 this is why this is why it gets so exciting right i could buy something today and wait for that rent growth 10 000 times 650. 6.5 million 6.5 million a month times 12. 78 million 78 million dollars a year i can't make that money selling books you know who who wrote that book that one that one lady that wrote that harry potter yeah i ain't [ __ ] harry potter man [ __ ] i could do that though if fred trump could do it i can do it okay my name is grant cardone i hope you enjoyed the show today i hope you enjoyed the mentor call today hopefully guys like do whatever you got to do to come get three days of this how many of you've enjoyed this today okay somebody just said 50 bucks a year 50 if the rents go up just 50 a year for the next 10 years those are 500. we just we just raise rents 400 per unit and we've only been there three uh 30 days without doing any renovation i hadn't done any renovations we removed the palm tree okay if any of you called that uh uh renovations okay so look if you're booking virtual who's coming virtual yeah man if you guys can change that change it up come over here get an airbnb stay at the hotel hang out with the people here you're going to meet the most incredible people ever put together in a room i'm telling you real estate investors are like no other group of people the quality of the people the questions the connections the networking so what do they have to do jared to go from virtual to to upgrade to email events yeah if you're in the uk and you can't make it i understand make sure you're on the virtual make sure that you don't got nobody bothering you because this is a three-day event we're bringing in some great speakers some surprise guests guys that have done 25 billion dollars guys that have done 100 billion dollars in real estate transactions there's going to be lenders in the room that have lent billions and billions of dollars and want to lend out more money now we have people coming that are just simply interested in what grant cardone is doing in the real estate community fannie mae freddie mac life insurance companies bank regional banks i'll have them all here so grantcardone.com summit is how you buy your ticket if you're bringing other people bring them you got to grab them now your gut we're going to sell out of this event and if you want to switch to live events at grantcardone.com events at grantcardone.com events at grantcardone.com if you want to upgrade to vip or vvip which includes a helicopter trip and us touring some of our properties johnny we need to shoot that video when we do that also the vip comes with dinner at my joint and a social media reel of us hanging out together at dinner uh how do they get that just call the office yeah or go to grantcardone.com grantcardone.com forsyth summit you can upgrade to a vip or vvip seat there includes uh front row seating helicopter trip dinner at my joint um it's cool man that money by the way the 20 there's a 25 000 option all that money goes to the grant cardone foundation so that you guys don't think i'm just a big [ __ ] money monger okay it's a way for us to fund our foundation so that i'm not the only person putting money in it every year keeps us compliant with our what is it called regulations and it gets other people involved in what we're doing at the grant cardone foundation we had 35 kids 40 kids here last week freaking supporting a group here in miami eighth graders they came in spent a whole day at our office getting super excited about going back to school and getting educated getting out and getting some jobs we just we just launched an initiative in africa the country of africa for 350 000 children to educate kids there that don't have access to computers technology don't know who i am yet start teaching them the money game how to get the bags secure the bag how to multiply the bags so if you guys want to help us out with this this dot com is slash summit come to the real estate program that's how you help us on our foundation okay grantcardone.com summit come show up be there in person thank you so much for being here today i'll see you guys what when is it next monday monday bang we live diggities [Music] who got my

Channel: Grant Cardone

Views: 33,014

Keywords: grantcardone, grant cardone, 10x, money, finance, business, sales, motivation, yt:cc=on, WeAre10X, 10XNation, 10XStrong, 10XLife, 10XEverything

Id: ex6EajaswvA

Length: 89min 35sec (5375 seconds)

Published: Mon Jul 19 2021