Passive Income
Lifestyles Unlimited, Del’s company, has been here for almost 20 years now. And what we do is we show people how to build wealth and passive realized monthly income streams using everything from single-family homes to several-hundred unit apartment complexes.
This evening’s case study is going to feature two consistently top-producing agents who have worked with our members. Judith Zahora is a top producing Realtor and mentor at Lifestyles Unlimited. And she guided Beverly and Malcom in their purchase of a short sale in the Cy-Fair area. They captured $31,000 and they additionally they are cash flowing $800 each and every month.
Also top producer John Warner helped Eric in his single-family. This was a double close. So if you’re interested in either—how to write offers on these short sales or do one of these double close where you go in with temporary financing and refinance out of that, then come in and ask these guys how they did what they did.
And in addition to that we’ll have a multi-family presentation as well where Scott purchased 163-unit apartment complex in the Galleria sub-market, B class property. It was already stabilized. It just needed a little bit of tweaking and rehab—or I’m sorry a small rehab to the tune of $300,000, returns are estimated to be 12 percent and they’ve already had a distribution in the first five months of $100,000.
JEFF: I don’t know. Are you the lead company-wide, Chuck, or here?
CHUCK: No. I strictly work Houston. I’ve talked to the other mentors sharing information from time to time, but I don’t have any supervisory or management interaction.
JEFF: All right. Well, the reason I asked you to come on is because one of the things that when people call me about their properties and when they find a really good deal, “go” is the word—execute, make your move. And you worked with Amber who’s the vendor program manager here in the Houston office of Lifestyles Unlimited. And I think it’s an amazing story of property that you found, and I really wanted you to come in and share that with Del’s audience.
CHUCK: Well, what had happened is I was talking to Amber in Natalie’s office, and she was interested in getting involved in investing and getting her first property. And I said, “Well, come on in and it’ll take me about 15 minutes to get you set up and I’ll start sending you emails of potentially good deals in your area. We just have to sit down and I’ll show you what our strike zone is and you tell me where you want to buy—keep it close to the office and your house and we’ll go to work.” And she did. And as I scanned down the list, I found like 36 properties and—
JEFF: Okay. There’s a question in and of itself right there. Thirty-six properties just out there right now that are sitting there when she said she wanted to buy?
CHUCK: Yeah.
JEFF: Awesome.
CHUCK: And I focused in on the one that said first day on the market—because the ones that are out there that have been there a week or so—if they’re deals—are gone. So we looked at it, analyzed it, and I thought, “My goodness gracious.” I had to stretch my perimeters a little bit. Normally I go plus or minus 100-200 square feet. To get comps, I had to go a little farther because this house was 4 bedroom in a 3 bedroom community. It was almost 2200 square feet where the average is 17, so it’s one of the larger properties.
JEFF: Uh-huh.
CHUCK: But if it was a small property it was still worth over a hundred grand and the asking price was 50. And in looking at the photos it’s got fresh paint, new floors, it’s like, “What’s going on here?”
JEFF: Well, I will bet that Amber is thrilled to have this property under contract.
CHUCK: Well, it’s not under contract. She waited five or six days before she looked at it and it’s gone. They went and looked at it last night and the deadline was five o’clock yesterday, and the agent wouldn’t give a minute on that.
JEFF: Oh, my goodness. Well, there it is.
CHUCK: Good deals don’t last.
JEFF: Good deals don’t last. And it really makes a case for what we call the point of personal responsibility—one of the principles that we go over in the free workshop where we talk about how 73 percent of the millionaires in this country are entrepreneurs. They went out there. They were proactive. They went out there and did it.
CHUCK: Uh-huh.
JEFF: And execution I think is one of the missing ingredients for a lot of folks.