Boomer real estate investing model with Old Dawg Bill Manassero. Ep 51.

How do Baby Boomers and 50+ catch up on retirement savings or increase monthly cash flow for smooth sailing in the retirement years? Listen as Bill Manassero of Old Dawg’s Real Estate Investing Network tells his experience beginning 3 years ago with no real estate to 100 units today.

In this episode, Jim interviews Bill Manassero, real estate investor, baby boomer, and real estate podcaster. Founder of the Old Dawg’s REI Network, host of the Old Dawgs Real Estate Network Podcast and Executive Director/President of Child Hope International, Bill has set the audacious goal of owning 1000 doors in 6 years. Currently, in year 3, he has already managed to own 100 doors. Bill shares his real estate journey—beginning with his very first purchases that were out of state to where he is today. He discusses how he scaled up by taking on mortgages or “good debt” and explains why he advocates for investing in multi-family homes as opposed to single-family homes. Bill urges all baby boomers to consider real estate investing as a way to fund their retirement. Tune in as Bill shares some of the hacks he’s learned along the way so that you can yield amazing cash flow from your investment property as soon as possible!

Time Stamped Show Notes:

    00:37 – Drying up that cash flow is a predicament that many boomers face; this is a fact discussed by Todd Tresidder in Episode 32 and Jordan Goodman in Episode 18

    01:07 – However, some people have lifetime pensions and no financial worries

    01:16 – A couple of market haircuts might mean that even $1 million in savings may not be enough for retirement

    01:37 – Jim recently closed on a duplex and was speaking with a home inspector

o      01:43 – Found out that the home inspector owned 15 rental properties

o      01:58 – When the market crashed, his real estate holding dropped like everyone else’s; however, his rental checks started coming in with increased regularity

    02:23 – Today’s guest, Bill Manassero, is a baby boomer, real estate investor and real estate podcaster with a goal of owning 1000 doors

    02:58 – Bill worked as a missionary in Haiti 12 years back

o      04:01 – Towards the end of his stint, Bill left with no retirement benefits and was wondering what to do next

o      04:25 – Was keen on becoming an entrepreneur since he wanted to enjoy his retirement years with his wife, kids, and grandkids

o      04:38 – Inspired by the likes of John Lee Dumas, he ventured into the world of internet by selling Amazon’s stuff on eBay

o      05:10 – Was making decent money, but then got kicked out of eBay due to a couple of bad reviews

o      06:02 – Invested his inheritance into 5 properties in Memphis and Atlanta

o      06:58 – On the back of his initial success, invested in another duplex in Indianapolis

o      07:17 – Still associated with Child Hope International based in Haiti; set a goal of 1000 units by the end of year 6 with the goal of benefiting this non-profit

o      07:41 – Simple strategy of doubling units every year; has managed to reach 100 units at the end of year 3

    08:30 – Started blogging his real estate story which slowly evolved into a podcast; aiming to help people who are approaching retirement or already in retirement

    09:40 – Purchased his first three properties in cash; realized that if he wished to grow further, he had to take up mortgages, which is “good debt”

    11:02 – Aims to make a cash flow amount of $100 per door

    12:10 – Inflation means that a dollar today will be worth less in the future; investing in real estate is a great way to counter inflation

    12:49 – While some stocks might totally dissolve in value in a tough market, that is not the case with real estate

o      13:17 – No matter how bad the economy is, people will always need a place to stay

o      14:02 – Real estate is a tangible asset, and historically values have always gone up in real estate

    14:37 – Define your needs in order to zero in on a property investment; if you need $200-$1,000 more, consider a single family home, duplex or fourplex

o      14:56 – Apartments are a way to get to a high-income level quickly

    15:17 – Ended up paying the same amount for the duplex as two single family homes but got twice as much rent; single property tax and low maintenance were the other perks

    15:32 – Started investing in multi-family homes to exploit economies of scale

    17:00 – 4 steps to invest in property:

o      17:06 – Education is the first step; know what you are buying and where you are buying

      07:14 – Do not buy in a market that is on the decline; buy in a market where jobs are being created and there is demand for housing

      17:29 – Know the kind of property you want to get, and what you hope to get out of that

      17:44 – Know what you are buying, and what you should be paying for the property

      17:52 – Not recommended to buy a turnkey property since you end up paying a premium; no guarantee if the property manager is any good

o      18:23 – Find a mentor who will help you build a rental portfolio

o      18:39 – Determine how much money you need to set aside, create a plan about the amount of money you need to set aside and the properties that you need to buy

o      18:55 – Step in there and take action

    19:38 – Your education is put to good use after purchasing a property as you need to find tenants and deal with taxes

    20:45 – Bill is based in California but owns properties in Memphis, Atlanta, and Minneapolis

o      20:55 – Better to find a property in your own neighborhood

o      21:35 – California is a speculative market and not right for someone looking for a good cash flow

o      21:56 – Tennessee is a big commercial hub; great demand and duplex prices as low as $30,000 renders it a good market

o      22:22 – Zillow estimate for the Minneapolis property that Bill purchased for $55,000 is currently $150,000

      23:02 – Rents out this property at $2,200 per month

      23:56 – After having the property vacant for six months, was able to get a good property manager and subsequently tenants through BiggerPockets

    26:10 – Bill talks about his experience purchasing a 22 unit complex in his second year

o      26:25 – Found a 22 unit apartment property on Loopnet selling for $400,000

o      27:53 – Offered $370,000 and ended up getting the property for $350,000 after inspection

o      28:02 – Appraised value by bank was $400,000

o      28:24 – 30% down payment was required due to Bill’s poor credit history

o      29:06 – A multi-family home consisting of more than 5 units is looked upon as a business plan

o      29:39 – After refurbishing the property, the value of the property has doubled

    31:48 – Top reasons for boomers to invest in real estate

o      31:50 – Strive to arrive on accurate valuations and driving up passive income

o      32:08 – Bill’s properties are located in other states; recommends a passive investment approach where the property manager is the one dealing with the daily grind

      33:04 – Finding a good property manager is critical for out of state investors

    33:16 – Open your properties under LLC to protect your other properties and personal assets; matters are generally settled between the tenant and the insurance provider and an out of state investor is completely out of the picture

o      33:50 – If the tenant knows you, they are more apt to go for your personal assets in the event of a lawsuit

    37:34 – Looking back, Bill would have slowed down a bit and found time to listen to people a bit more

    38:41 – Connect with Bill through his email

    39:01 – Check out the Child Hope website to know more about how they are helping children in Haiti

    39:53 – The Old Dawgs Real Estate Network Podcast is geared towards 50 plus individuals looking to invest in real estate

    40:21 – For Bill, investing in real estate is a way of helping out the kids in Haiti, visiting different places, and giving his daughters the marriages of their dreams

    41:50 – Just because you are retired does not mean that it is over

o      42:09 – Bill started investing in real estate at the age of 60 and is loving every minute of it; real estate investing is like a hobby that reaps great rewards

    42:39 – In Planet Boomerville, we know that life is just beginning, and the whole idea is that this part of life is to be as good or better than the prior life

    43:40 – Jim Enright’s sign-off message: Be stellar, and live life lively

    43:50 – Spread the word with your baby boomer friends in person and on Facebook—Teach them how to listen to podcasts and how to subscribe

3 Key Points:

1.       Do not buy in a market that is on the decline; buy in a market where jobs are being created and there is demand for housing.

2.       Investing in multi family housing is a great way to exploit economies of scale.

3.       A passive investment approach can yield rich returns for you; hiring a good property manager is critical for out of state investors.

 

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