1
00:00:00,160 --> 00:00:02,480
Speaker 1: I leverage pretty much everything. I think that's the best

2
00:00:02,480 --> 00:00:05,080
thing you can do for velocity. You know, the more

3
00:00:05,080 --> 00:00:07,360
money I can keep in my pocket, the more I

4
00:00:07,360 --> 00:00:09,679
can keep forward down payments. You know, whether it be

5
00:00:09,800 --> 00:00:12,000
seller finance, we do a lot of creative finance, that

6
00:00:12,080 --> 00:00:14,519
kind of thing. You usually need something at closing costs,

7
00:00:14,519 --> 00:00:16,239
et cetera. So we leverage everything we can.

8
00:00:16,519 --> 00:00:20,440
Speaker 2: You're listening to Carrie Let's Financial Survival Network, where you

9
00:00:20,480 --> 00:00:24,399
get valuable information you just can't find anywhere else to

10
00:00:24,559 --> 00:00:28,600
thrive in today's trying times. You need the Financial Survival

11
00:00:28,640 --> 00:00:33,359
Network now more than ever. Go to Financial Survivalnetwork dot

12
00:00:33,399 --> 00:00:37,719
com and get your free newsletter and gift. Financial Survival

13
00:00:37,759 --> 00:00:40,679
Network now more than ever.

14
00:00:43,880 --> 00:00:47,479
Speaker 3: And welcome you are listening to and latching the Financial

15
00:00:47,520 --> 00:00:50,520
Survival Network. I'm your host, Kerry Let. A lot of

16
00:00:50,520 --> 00:00:53,200
people go into real estate, a lot of people are

17
00:00:53,240 --> 00:00:56,640
successful at it. What I find fascinating about the state

18
00:00:56,759 --> 00:01:01,759
that everybody finds their own entry. And person you're about

19
00:01:01,759 --> 00:01:05,560
to hear from the newcomer to the show first time

20
00:01:05,640 --> 00:01:11,680
on the show is name is Jefferson Calloway. Jefferson, you

21
00:01:11,799 --> 00:01:14,719
are a vet, and thank you for your service and

22
00:01:15,239 --> 00:01:20,040
you got into real estate investing while you were serving

23
00:01:20,079 --> 00:01:20,640
the country.

24
00:01:20,680 --> 00:01:23,359
Speaker 1: Correct, Yes, that's correct, and thank you very much for

25
00:01:23,400 --> 00:01:27,280
the support. YEP. Joined in twenty sixteen, got out twenty

26
00:01:27,400 --> 00:01:30,000
twenty one, and it was that last year that I

27
00:01:30,040 --> 00:01:33,359
bought my very first rental property by accident. I was

28
00:01:33,359 --> 00:01:34,719
just going to buy a house and live in it,

29
00:01:34,799 --> 00:01:37,840
but moved away, decided to rent it out, and just

30
00:01:37,920 --> 00:01:39,640
kept on going from there. The rest was history.

31
00:01:40,519 --> 00:01:43,840
Speaker 3: That's great. So you got twenty seven. Now, like, how

32
00:01:44,040 --> 00:01:46,280
what's your cash flow and your pre cash flow on

33
00:01:46,359 --> 00:01:48,560
the property? Can give me a range up and tell

34
00:01:48,599 --> 00:01:49,640
me the exact amount?

35
00:01:49,760 --> 00:01:52,879
Speaker 1: Sure, I mean it's ranges, but I would say the average.

36
00:01:53,000 --> 00:01:55,480
You know, I pay all my mortgages that are probably

37
00:01:55,640 --> 00:01:58,680
a total of maybe fourteen thousand, but you know, the

38
00:01:58,719 --> 00:02:01,519
properties in general bring in you know, eighteen to twenty

39
00:02:01,599 --> 00:02:05,840
thousand in total, so after all expenses, I would say

40
00:02:06,079 --> 00:02:07,120
four or five grand a month.

41
00:02:07,680 --> 00:02:11,639
Speaker 3: That's pretty good. Pretty good? And yeah, so how do

42
00:02:11,680 --> 00:02:14,039
you scale this up? How can you have one hundred disease?

43
00:02:14,360 --> 00:02:17,520
Is there a particular type of property? Are you looking

44
00:02:17,560 --> 00:02:20,879
for a military base near military basis?

45
00:02:20,919 --> 00:02:23,439
Speaker 1: As that were? Yeah? I mean the first one turned

46
00:02:23,439 --> 00:02:25,960
out so well. It was an enterprise Alabama, which is

47
00:02:26,000 --> 00:02:28,439
near Fort Rutger, southern Alabama, right near the Florida border.

48
00:02:28,960 --> 00:02:33,400
And I have since gotten a bigger, sing single family

49
00:02:33,439 --> 00:02:36,680
portfolio there just because I love the area. The price

50
00:02:36,759 --> 00:02:39,000
to rent ratios are great, they work for cash flow

51
00:02:39,039 --> 00:02:41,159
really well. The fact that there's a lot of soldiers

52
00:02:41,199 --> 00:02:44,000
cycling through is really just a bonus. I mean, you

53
00:02:44,039 --> 00:02:46,759
can't act a fool as a soldier in rental property

54
00:02:46,840 --> 00:02:49,039
or your command will find out. And there's always tenants

55
00:02:49,039 --> 00:02:52,599
because there's always soldiers cycling through. But I don't make

56
00:02:52,639 --> 00:02:55,520
that one of my criteria anywhere else. You know, like

57
00:02:55,520 --> 00:02:57,879
I said, we're in seven different states now and I

58
00:02:57,960 --> 00:03:00,400
have found that not a lot of other military but

59
00:03:00,479 --> 00:03:03,159
you know, building your rental portfolio around a military base

60
00:03:03,199 --> 00:03:05,960
would be pretty limiting. So I still invest in Alabama

61
00:03:06,000 --> 00:03:08,520
near the base. But everything else is not near bases,

62
00:03:08,560 --> 00:03:11,599
not near universities. It's really wherever you can find cash

63
00:03:11,639 --> 00:03:14,840
flow in this in this climate. And in the beginning, yeah,

64
00:03:14,879 --> 00:03:17,240
in the beginning it was mostly single family, but I

65
00:03:17,319 --> 00:03:21,240
have since moved on very very hard into multifamily just

66
00:03:21,280 --> 00:03:26,080
because the cost of maintenance and capital expenses per net

67
00:03:26,080 --> 00:03:28,560
cash flow and per door are just less. I mean

68
00:03:28,560 --> 00:03:31,039
you've got four or five six units under one roof.

69
00:03:31,159 --> 00:03:34,000
That helps the same thing with HVAC. And also the

70
00:03:34,080 --> 00:03:35,439
risk is lower. I mean if you have one or

71
00:03:35,439 --> 00:03:37,759
two tenants missing, that's fine. I still get half the rent.

72
00:03:38,039 --> 00:03:40,599
Single family, you go six months without a tenant, you

73
00:03:40,639 --> 00:03:44,199
get zero. So definitely moving into multifamily and doesn't have

74
00:03:44,240 --> 00:03:45,800
to be around military basis.

75
00:03:46,639 --> 00:03:48,919
Speaker 3: What are you looking for, like, how do you what

76
00:03:49,000 --> 00:03:52,080
kind of valuation do you do, and what type of

77
00:03:52,199 --> 00:03:53,439
cash flow analysis?

78
00:03:54,240 --> 00:03:57,240
Speaker 1: Sure, so I leverage pretty much everything. I think that's

79
00:03:57,280 --> 00:03:59,360
the best thing you can do for velocity. You know,

80
00:03:59,400 --> 00:04:02,120
the more money I can keep in my pocket, the

81
00:04:02,120 --> 00:04:04,560
more I can keep for down payments. You know, whether

82
00:04:04,599 --> 00:04:06,919
it be seller finance, we do a lot of creative finance,

83
00:04:07,000 --> 00:04:09,560
that kind of thing. You usually need something at closing costs,

84
00:04:09,560 --> 00:04:13,639
et cetera. So we leverage everything we can. But I

85
00:04:13,639 --> 00:04:16,439
would say at this point it's really total gross monthly

86
00:04:16,439 --> 00:04:19,160
rent for the property. Mine is twenty five to thirty

87
00:04:19,199 --> 00:04:24,120
percent for expenses that's maintenance, capex, lawn care, utilities, et cetera, vacancy,

88
00:04:24,759 --> 00:04:28,079
and then minus the mortgage payment whatever that would be.

89
00:04:28,120 --> 00:04:32,959
PIPI and whatever's remaining is your ultimate net cash flow.

90
00:04:33,160 --> 00:04:35,959
And my minimum is a few hundred dollars, maybe two

91
00:04:35,959 --> 00:04:38,639
to three hundred dollars per door. So if I've got

92
00:04:38,680 --> 00:04:40,439
a four plex, if I've got a five plex, it

93
00:04:40,519 --> 00:04:43,160
better be bringing a net free cash flow eight hundred

94
00:04:43,199 --> 00:04:45,199
to one thousand dollars a month for that one property.

95
00:04:45,519 --> 00:04:47,560
And that's anywhere in the continental US. You know, that's

96
00:04:47,600 --> 00:04:49,959
one of the best things about being remote investor. When

97
00:04:49,959 --> 00:04:51,839
a wholesale or a realtor sends me a deal, I

98
00:04:51,879 --> 00:04:54,399
don't care where it is. Texas, Ohio is another great

99
00:04:54,439 --> 00:04:56,839
market we just got into. I can buy anywhere, so

100
00:04:56,879 --> 00:04:58,680
I'm not limited to my local market. A lot more

101
00:04:58,720 --> 00:05:01,639
opportunity that way, all right.

102
00:05:01,720 --> 00:05:04,600
Speaker 3: So when you're looking at a property, what about the

103
00:05:04,680 --> 00:05:08,720
condition of the property to age all of that? How

104
00:05:08,720 --> 00:05:09,800
do you evaluate that?

105
00:05:10,000 --> 00:05:12,319
Speaker 1: Yeah, I mean you always just allow for more of

106
00:05:12,360 --> 00:05:15,600
a percentage of your gross monthly rent to accommodate older homes.

107
00:05:15,639 --> 00:05:18,240
But the thing is a lot of multifamily they are

108
00:05:18,360 --> 00:05:21,240
older homes, so I account for an additional five percent,

109
00:05:21,720 --> 00:05:25,839
But ultimately even newer properties seventies, eighties, nineties, ohs, they

110
00:05:25,879 --> 00:05:27,519
still have problems. I mean, most of the time, I

111
00:05:27,560 --> 00:05:30,439
find that it's not the property itself that you end

112
00:05:30,519 --> 00:05:33,519
up spending more money on. It's usually your utilities HVAC,

113
00:05:33,720 --> 00:05:36,399
roof A lot of time to apply in this, you know,

114
00:05:36,399 --> 00:05:37,759
stuff that has nothing to do with the age of

115
00:05:37,800 --> 00:05:41,319
the home necessarily. So I don't mind buying age old stuff.

116
00:05:41,319 --> 00:05:43,360
I just bought a six plex and Hagerstown that's over

117
00:05:43,360 --> 00:05:45,759
one hundred years old. Haven't had many problems with it

118
00:05:45,800 --> 00:05:47,959
at all. So we're buying pretty much everything we can

119
00:05:47,959 --> 00:05:50,279
get our hands on that don't make them like that anymore?

120
00:05:50,399 --> 00:05:50,680
Speaker 3: Do that?

121
00:05:51,759 --> 00:05:54,240
Speaker 1: No, they do not. Not a lot of small multi

122
00:05:54,240 --> 00:05:56,839
family in general anymore. It's mostly single family now.

123
00:05:56,920 --> 00:06:01,959
Speaker 3: All right, So somebody look to get into the real estate, now,

124
00:06:02,279 --> 00:06:04,240
somebody you do that on the street, What would you

125
00:06:04,279 --> 00:06:05,720
tell about the house haack?

126
00:06:06,040 --> 00:06:08,040
Speaker 1: Always, always, always, the best thing you can do, in

127
00:06:08,040 --> 00:06:10,000
my opinion, is house sack. And for those who don't know,

128
00:06:10,439 --> 00:06:13,560
that is just living in a home and renting out something.

129
00:06:13,600 --> 00:06:16,439
It doesn't even have to necessarily be another unit like

130
00:06:16,480 --> 00:06:20,079
a duplex, triplex, squad plex. It can be, and you

131
00:06:20,120 --> 00:06:22,560
can get up to four units with any conventional loan.

132
00:06:22,720 --> 00:06:25,279
Fha USDAVA doesn't matter what kind of loan. You can

133
00:06:25,279 --> 00:06:27,879
get up to four units and live in one, run

134
00:06:27,959 --> 00:06:30,639
out all the others. But you don't even have to

135
00:06:30,639 --> 00:06:32,560
do that. I used to back when I was first starting,

136
00:06:32,600 --> 00:06:34,920
I rented out rooms if I could. My current house,

137
00:06:34,959 --> 00:06:37,879
I rent out a horse stall that's in the barn

138
00:06:37,920 --> 00:06:39,439
in the backyard. You know, we are on a couple

139
00:06:39,439 --> 00:06:41,839
of lakers now, I'll run out of anything to bring

140
00:06:41,879 --> 00:06:44,680
in some cash flow. And even if you're not cash flowing,

141
00:06:44,839 --> 00:06:47,240
like if you're not making money on the property, the

142
00:06:47,279 --> 00:06:49,720
average American spends over thirty percent of their total net

143
00:06:49,720 --> 00:06:52,800
income on their living expense. So even if you buy

144
00:06:52,959 --> 00:06:56,319
just a duplex and your buddy rents out a step

145
00:06:56,319 --> 00:06:57,920
to the other unit for twelve hundred a month and

146
00:06:57,920 --> 00:07:01,040
your mortgage is fifteen hundred, Okay, your mortgage is now

147
00:07:01,079 --> 00:07:04,000
only three hundred dollars. You just knocked out an enormous expense.

148
00:07:04,040 --> 00:07:07,279
It's the same effect. So saving keeping your money, it's

149
00:07:07,279 --> 00:07:08,439
the same thing as not spending it.

150
00:07:08,800 --> 00:07:12,959
Speaker 3: Right, So that the idea, So you're in the market

151
00:07:13,000 --> 00:07:15,720
for a new for a home, your first home, buy

152
00:07:15,800 --> 00:07:16,399
a dude.

153
00:07:17,600 --> 00:07:19,879
Speaker 1: Yeah yeah, yeah, or by a single family home. It's

154
00:07:19,879 --> 00:07:21,120
got a lot of bedrooms.

155
00:07:21,399 --> 00:07:21,560
Speaker 3: You know.

156
00:07:21,600 --> 00:07:23,759
Speaker 1: The only downside is I understand you know a lot

157
00:07:23,759 --> 00:07:26,240
of people have messaged me and said, you know what

158
00:07:26,279 --> 00:07:28,000
if I've got four kids and a wife and they

159
00:07:28,000 --> 00:07:30,519
don't want to You're right, that's that's more difficult. So

160
00:07:30,560 --> 00:07:32,480
you can run out rooms. You don't want strangers living

161
00:07:32,519 --> 00:07:34,040
next to your kids and your woman. She's not going

162
00:07:34,040 --> 00:07:36,439
to like that either, But you know, I still stand by.

163
00:07:36,639 --> 00:07:39,120
You can get a multi family, or you can figure

164
00:07:39,120 --> 00:07:41,040
out how to rent something. Let them put parking r

165
00:07:41,120 --> 00:07:43,120
V on the property if you've got acreage. A lot

166
00:07:43,160 --> 00:07:44,920
of ways to get creative, and it may not be

167
00:07:45,000 --> 00:07:48,399
very comfortable, but hey, so is being broke. So pick

168
00:07:48,439 --> 00:07:49,000
your poisons.

169
00:07:49,240 --> 00:07:51,759
Speaker 3: I like it. I like it all right. I know

170
00:07:51,839 --> 00:07:53,879
that people out there are going to want to connect

171
00:07:53,879 --> 00:07:55,920
with you on the web. I want to talk to you.

172
00:07:56,639 --> 00:07:59,360
How do you How do we find you on the web? Connected?

173
00:08:00,360 --> 00:08:02,959
Speaker 1: So you can message me on Instagram, Facebook, I'm at

174
00:08:03,040 --> 00:08:06,319
Jefferson Callaway on all those I'm easy to find. You

175
00:08:06,360 --> 00:08:09,920
can also email me Jefferson at Calcapital dot us. That's

176
00:08:09,920 --> 00:08:13,199
the real estate company, so it's CALC A L Capital

177
00:08:13,240 --> 00:08:15,600
c A P I T A L dot us. You

178
00:08:15,639 --> 00:08:18,480
can always email me and I'm pretty busy. I've got

179
00:08:18,480 --> 00:08:20,480
a Homer modeling company up here in Philadelphia, so I

180
00:08:20,519 --> 00:08:23,000
can't respond to stuff. But I mean, if somebody wants

181
00:08:23,000 --> 00:08:26,040
some paid consulting, I have no problem doing that. You know,

182
00:08:26,160 --> 00:08:27,240
spread the wealth around a little bit.

183
00:08:27,360 --> 00:08:30,720
Speaker 3: Appreciate you coming on the show. Got a question, comment

184
00:08:31,240 --> 00:08:34,759
or Jefferson myself. Shoot me an email k L at

185
00:08:34,879 --> 00:08:37,720
Kerry Left dot com and to find a link to

186
00:08:37,799 --> 00:08:41,759
jefferson site to show that this interview on Financial Survival

187
00:08:41,840 --> 00:08:44,519
Network dot com. And I'd ask you to sign up

188
00:08:44,600 --> 00:08:45,720
for your pre newsletter.

189
00:08:45,879 --> 00:08:46,120
Speaker 1: Join.

190
00:08:46,600 --> 00:08:49,360
Speaker 3: I think we're up to about sixty thousand subscribers. Now

191
00:08:50,000 --> 00:08:54,679
join those sixty thousand people get the newsletter for free. Jefferson.

192
00:08:54,759 --> 00:08:57,080
Appreciate you coming on and we'll talk to you soon.

193
00:08:57,440 --> 00:08:59,440
Speaker 1: Sounds great, Thanks Lochey, I really appreciate it.

194
00:08:59,600 --> 00:09:04,279
Speaker 2: Thanks listening to Carrie Letz's Financial Survival Network your solution

195
00:09:04,559 --> 00:09:08,360
to today's trying times. For the latest, go to Financial

196
00:09:08,480 --> 00:09:14,080
Survivalnetwork dot com. Financial Survival Network now more than ever