Double your retirement account by investing in Mobile Home Parks with Jill Jensen - 483

Welcome to Real Estate Investing Abundance, the show for busy, fulfilled professionals like you to learn how to develop financial independence built on solid passive real estate investments. Now, here is your host, Dr. Allen Lomax.

Hello, enlightened investors. Welcome back to Real Estate Investing Abundance. I'm your host, Dr. Allen. And I surely do appreciate you joining us once again today as we have a very interesting topic to talk about today. We're talking about doubling our retirement accounts and income by investing passively in mobile home parks. With us today is Jill Jensen, and she is the dynamic Chief Investment Officer at Sonos Capital, where she specializes in empowering both novice and seasoned investors to venture into the lucrative world of large mobile home park investments. Her journey to success is nothing short of inspiring. Starting in door-to-door sales, Jill shattered expectations by earning 6 figures in just 5 months selling past pest control This achievement paved the way for her to establish her own pest control company, which rapidly expanded nationwide, generating millions in annual revenue. As a devoted single mom to 2 wonderful girls, Jill is passionate about inspiring and empowering other women to thrive in the entrepreneurial space. So welcome, Jill, to the show, and take us into the show. and share a memorable experience that was key to helping you be who you are today?

Allen, I appreciate the time to be here with you and your audience. And one of those memorable times you already touched on, and that was in my early 20s knocking doors. And what that transformed into was I had this mentality of doing things other people aren't willing to do to set myself up for success in the future.

Mm-hmm.

And being able to knock on strangers' doors and be able to communicate a service that I provided and being able to close deals after 10 or 15 minutes connecting with someone on their front door, complete stranger, molded into what I do now, and I help investors or just people who are looking for passive income in real estate. And being able to talk to complete strangers and being able to communicate what I still do, being able to serve and help them.

So that was early 20s. That is, that's quite an undertaking for, well, anybody. Door-to-door sales is probably one of the more challenging sales To get into, and yet you thrived in that at a very early age, and you identified the capacity there to engage in things that other people are not willing to do to propel your success in life. So going back even before that, what was it in your life, your personality, your environment, your lived experiences up to that point that actually gave you the ability to, to be determined and resilient in that particular occupation?

That's a really good question, and let's go back to my childhood. I came from a family that blue-collar, 9-to-5, hardworking. I understood the importance of Not just making money but saving money. On the flip side, my family kind of came from a scarcity mindset of let's just save our money and let's pay off our homes and let's just work really hard to make the exact amount of money we know we're going to make in a year, where I was like, I want to tap into I get to decide how much money I make every year depending upon Not necessarily working harder, but first harder and then smarter by leveraging other people's skills and building upon getting the right people in place to grow something besides just working individually. That led into door-to-door sales. That was a completely commissioned-based Mm-hmm.

job.

It was a 1099, so there's nothing That was guaranteed, but also there was no cap or ceiling on how much I could make. So that kind of paved the way. And because I did really well early on, I had other people ask what I did to make 6 figures as a 20-year-old girl. Fast forward, I recruited other sales reps and I made overrides from these companies. off of recruiting. Built managers and teams, once again, was making money off of teams. Fast forward, my former husband and I realized instead of putting on accounts for Terminix, let's start our own pest control company and have our hundreds of sales reps put on accounts. And that's kind of where it clicked for passive income. Because these clients or customers were signing a contract, which means every 3 months we were spraying their home and getting that income on a regular basis off of that same individual, not just a one-time sale. And then that led into, okay, what do all wealthy people have in common? And a lot of them hold real estate or invest in real estate. And so that, that's where the mentality and the mindset of pest control led into real estate.

Yeah, well, you, you certainly took a different route than your parents did. What was the, the catalyst other than just desire to have an income that didn't have a cap? What was really the catalyst that allowed you to do that?

I want to create things and do it with people that I want to do things with. And being able to pick what I do on a daily basis really determined, okay, what's a— just a different avenue in leveraging my people skills? And instead of my only W-2 job was in high school. And so the mentality from an early stage of, okay, this entrepreneurial game was intriguing on, on learning how to do it myself.

Well, fascinating, uh, journey there. So you, you went from, uh, the pest control industry to mobile home park investing because of the obvious advantages of passive income. What was the starting point for you in stepping into real estate?

When I was doing my pest control company, I got bought out of that company. I stepped out of that and was left with a lump sum of money, and that's where the thought of, I know I can get my money making me money, to live comfortably. How do I do that? And that's where the thought of passive income— a lot of wealthy people are in real estate, so how do I learn that game? It was more off of finding the right whos than figuring out how. I was like, if I could just find the successful people who are already doing this that have had a lot of lessons, and I could tap into their knowledge, or invest with them over trial and error.

Mm-hmm.

From there, I started— it was kind of like throwing spaghetti on the wall. I didn't have anyone in my circle of influence that was doing this. I also wasn't telling anyone because, like I mentioned, my family is more a blue-collar family, and I didn't want to be talked out of a direction I wanted to go. I joined different mentorships. I joined a group called Sub2, and they focused on different avenues within real estate.

Mm-hmm.

And their biggest focus was acquiring properties without going to the bank on terms or creative finance. The reason that was intriguing to me was because, like I mentioned, the only W-2 job I had was in high school. And I was like, I can't go get a loan, even though I could pay for a house with cash. But that's not something I want to do. So this was teaching how you can acquire someone's property by having them carry the loan and so forth. Once I started learning that, I realized I want to skip past the single family and get into the multifamily space.

Mm-hmm.

I had 2 problems. First, it was I had sufficient funds and I just needed it making me money. Once I learned the skill of lending my own money, I ran into a second problem, and that was taxes.

Taxes.

Because I was just a lender. I was just, you know, lending on fix and flip. I can proudly say I've never lost any money. Because I found the successful people in their right avenues. Fast forward, I came across a gentleman who invests in mobile home parks and strictly mobile home parks. And my first park, the gentleman was 84 and he hadn't raised rents in 50 years.

Oh, wow.

He was charging $60 in rent.

Wow.

And I was like, okay, let's look at the comps. The lowest comp was $300. And I was like, okay, without me even knowing how to underwrite completely, or understand how to vet a deal, seeing that gap on just being able to raise rents, and then having it cash flow. And so I became what we refer to a private money partner. I lent my money, but instead of getting a higher interest rate, I was getting equity.

Mm-hmm.

And that's where the concept really clicked of, wow, this thing is cash flowing $10,000 a month. And I'm not— I've never been to the park yet. I'm getting mailbox money, I'm getting write-offs. And that's where the generational wealth or building wealth clicked, where Yeah, I didn't get as high a return early on, yet I'm going to be getting a check every month until this thing sells, and then I'll get a large sum of money off of my percentage. Fast forward, I figured out my problems— getting my money making me money, solving the taxes. I'm a single mom. Now what do I do during the day? And that's where I partnered with Sonos Capital, and I said, I'm gonna go solve the same problem other people have. They have retirement accounts, their money's in a CD. That's where mine was. I was like, 4.8% wasn't bad without knowing real estate. And then I was like, wow, okay, we can do better than a CD. And so I know there's a lot of people in my network where Mm-hmm. I truly feel like I'm serving people and able to get their money working for them and in a vehicle that I feel confident. And I can't use the word guarantee, but the company that I work with, their strategies behind how they're acquiring these parks and their main focus is mobile home parks.

So now my position is just help other Yeah, that question of guarantee comes up frequently, and of course it's an investment and it doesn't come with guarantees. But there certainly are risk management ways and means to be pretty certain that your capital is not going to vanish and that you're going to get the returns that are projected. And you had mentioned earlier that that's people. And so the question I have, and I've certainly had this issue, because it is critical to partner with the right people, but it's not always easy to know who those right people are. And in fact, my experiences have been, you mentioned spaghetti on the wall or throwing spaghetti on the wall. That's kind of been my experience in really finding the right people. What has your experience been like?

I've gotten on the phone. Some people call sellers to purchase properties, and I was just searching for other investors, and I asked them 2 questions. I said, what do you need in your business? What are you looking for? And also, what do you have to offer other people? And by talking to enough people, I was able to connect other people. I was like, how much can I serve others? And then I was like, okay, I want to find the people who are successful at lending their money and ask them all of the same questions I asked when I started pest control. I was the top girl sales rep. And it was the simplest formula. I found the top rep and I said, what do you say? I memorized his lines. Where do I move? How many hours? How many doors do I knock? What are the percentages? What's the tone of voice? And when I found someone that I lent my money to, he'd been doing this for years. He had a track record. He had other people that I could connect with. And that I did deals with. And my biggest advice that I give to other people starting out or lending is the thought of loan to own. Don't lend on a deal if you're not willing to own the worst case scenario. And how I overcame the worst case scenario. Without learning how to underwrite or vet the deal was overcollateralize on any loan, which means if their fix and flip flops, I'll only lend to people who have another property that's cash flowing that I can kind of hold hostage. And if they don't stick to what we agreed on in the paperwork, The JV agreement, I already have a thing in place where your fix and flop flops, I actually win bigger and it's already set in place. So I wasn't lending to a person who was struggling financially who really needed my money. I learned to lend to people who were just leveraging other people's money. And then fast forward, I got into the mobile home park space and my business partner at Sonos Capital, I vetted him as a person, his values, his morals, and then once again, his track record and the strategies of the things that he's doing to position himself before even acquiring one of these mobile home parks. And I'll give a couple examples. Number one, he became a dealer for these mobile homes themselves. Why that's significant is because we're buying distressed properties, ones that need new homes or they have vacant lots, and he genuinely wants to provide affordable housing in these communities. And being able to buy a home at a wholesale cost, at that discounted price, we're selling those homes at cost. We're not trying to make money off of the homes themselves. So people are walking into these homes that have equity and they're more affordable, which actually helps us and our investors because We don't want to own the homes. We don't want to manage them. Less overhead. And we're trying to collect rent as quickly as possible on those pads in the mobile home parks. So finding his strategies behind how he's doing it, he's getting them off market. He knows how to find the mom-and-pop shops, helping these tired landlords. He became a board member for affordable housing in the communities that were buying them. So he has a say in things that are getting approved for affordable housing.

Mm-hmm.

He's not getting paid for that, but he's helping the communities. And also he sees things that are going on in the cities, what big box stores are coming in, where new jobs are being provided. And so That's an example of finding the right whos, but we're figuring out how.

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And finally, be sure to subscribe so you don't miss a single one of our upcoming episodes. Well, we are visiting today with Jill Jensen, and she is with Sonos Capital, and you can contact Jill by going to sonoscapital.com and you can set up a time to have a conversation with Jill. And as you can tell from our conversation thus far, Jill has a great deal to offer those who are wanting to get into passive investing. Well, it's interesting, your strategy. I, I think that most people would find it very counterintuitive To be selling all of these mobile homes at cost, but those of us who are in real estate go, aha, that is a perfect strategy. Because, I mean, you could sell them at a retail cost and have a one-off cash influence there, but that's not what you're interested in. You're interested in— The long term, and that's where the real wealth is really developed and coming from. So excellent strategy there that probably most people don't think of or are not willing to employ. And not only is that beneficial to your long-term wealth development, what a gift to the working class in the communities that you are working in there?

It's just satisfying. My partner was telling me how he had a gentleman come in and he had just bought a wedding ring for his girlfriend and he qualified for this 2-bedroom, 1-bathroom house. And being able to see people benefit from the work we're doing— and of course my focus is My position is helping investors, and there's a lot of investors that they have their money working for them. So adding a mobile home park to their portfolio and seeing that we're giving back to these people in these communities, and we update our investors showing them, look, here's the next family that purchased this home. Look at these updated amenities, these dogs that are enjoying the dog park. It helps really see the, the benefits of helping these communities.

Yeah, for sure. Well, what are, are different ways that people can invest, particularly fulfilled professionals who are engaged and passionate about their work? How can they not only continue that work but through investing really free themselves financially to actually engage more passionately without the pressures of, of doing their work for a living?

That's a really good question and the biggest focus that I work with within people who have different vehicles. And I mentioned Retirement accounts. There's trillions of dollars that people have in retirement accounts that I'm like, I can show you how to take advantage of tapping into that. Also, people have money sitting in in an account just in a bank, where being able to put that in a vehicle where you have passive income, another source of income off of. Your hard work of what you're doing. And also being able to offset some of those taxes, being in real estate and placing it in a vehicle where, hey, long-term this is going to generate wealth over just paying on taxes. So leveraging your taxes. I have other people who have life insurance policies that have a cash value account. And they're able to invest that as well. A CD, an inheritance, their HELOC. There's just a lot of different avenues than someone that just has cash in a bank account.

And it's interesting to me that, um, that people are— who are, are doing well, uh, from a lot of different respects, and I work with professionals all the time in various different callings, and they have, generally speaking, prestigious jobs in the community, and they're well respected, and they've been in these jobs for anywhere from 5 to 10 or so years, and they have all of these resources that you're talking about, and they have never even considered how to Right. Put those resources to work to develop their wealth. They just kind of sit there and in a lot of respects drain their wealth because they're not developing wealth like you were talking about CDs paying 4.5% and you thought that was doing pretty good, but that doesn't even keep up with inflation. So they're depleting their wealth by keeping their money in those CDs. And they don't even think about those things.

And it's just sometimes you don't know what you don't know.

Exactly.

And I feel really, really passionate of just educating and communicating that to people. I am a single mom with 2 girls and being able to think of, okay, this can benefit me and One of my whys is to have my third generation remember the systems that I set in place for them. They won't necessarily see my money. I don't want to ruin them. But by providing, you know, if I could be the bank where they could go get a loan from because they have an endeavor or a business idea. So thinking long-term for not just myself, but Those that come after me setting up systems or, you know, just getting wasted or giving it away. It's like, where do I want that money to go? Because I know there's so many other people with the same way. It's like, why do I work so hard? Why am I passionate? What can I— what good can I do with my money? And so I just like to help other people leverage that.

Well, Jill, that reminds me of— I guess it's an old Chinese proverb, and that is, give a person a fish and feed them for a day, or teach a person how to fish and feed them for a lifetime.

Jill, we know that you are primarily investing in mobile home parks.

I'm just curious, are there any other types of commercial or real estate that you all are investing in, and if not, why not?

And what are some of the strategies that you are actually putting in place in your current investment processes?

Currently, strictly mobile home parks, and how we're acquiring these We're able to connect with mom-and-pop shops off market, which means we're able to get them at a discounted price. And our business model is we're okay with a fix-and-flip type of approach where these— there's a gap in raising rents. And we do that slowly Over a 5-year term. There are people that don't understand real estate and they're like, oh no, you're raising rents on people who are struggling. And I was like, $25 a year for 5 years isn't too bad when you understand the concept. After we've slowly raised these rents, we're updating the amenities, we're bringing in new homes, we're fixing them up. We're able to give good returns to our investors themselves. And how that side works is we closed on a park 3 weeks ago in Globe, Arizona. It was 102 units. It was— it's 60% occupied, 40% unoccupied. We're able to get those homes at a discounted price. We're taking down a few of the homes that are really distressed, bringing in brand new homes. And as we update those amenities, it does a couple things. It increases the land value, which gives us more equity in the deal. It makes it easier to raise the rents on the people that live there. They're seeing us bring value. And number 3, it's important that these parks and communities are Well kept because we still need to sell 40 homes. I asked my my investors, what happens if we don't sell those 40 homes? How do you know we're gonna sell them? Well, we were running test ads prior, asking hey, putting out ads saying mobile home, here's the price, Globe, Arizona, in this park. How many people were qualifying? And how many people we're calling. We have a lender in place. When someone qualifies, we already have who they can work with on getting that loan. And that does a couple things. It's going to help someone get a home. And second, if you remember, our model is how quickly can we collect rent on that pad? If we can help the buyer get that loan, And get in that home, we'll be able to sell it quicker. After that 5-year span, we also will sell the park at that higher price. And here's a really cool thing that I learned about mobile home parks, and this is something that's very enticing to my investors. Single-family homes depreciate over 27 years. Mobile home parks depreciate over 15, and year 1, we're able to take bonus depreciation. As a lender, you're able to take advantage and leverage those— that depreciation with us. An example on someone that invested in this last park, $100,000. And it's all— I'm no CPA, so it depends upon how you're investing. Is it a retirement account? That's different than a real estate professional who really needs the tax write-offs. Being able to invest that, their depreciation year 1 is around $44,000 just being the lender. And that was enticing because that was my problem. Not having to manage but still have that equity. And over the 5-year span, their tax advantages are higher than their actual investment of around $122,000. And so the reason I even explain this is because that's the process of why we're acquiring mobile home parks. That's why we've picked, because It's helping a lot of people across the board.

Enlightened Investors, today we have been visiting with Jill Jensen, and she is with Sonos Capital, and you can find her at sonoscapital.com. Enlightened Investors, it has been a delight to be with you again today. As always, we always appreciate your presence with us. And if you could please just take a moment to go to Apple Podcasts, and we would be greatly appreciative if you could leave us a rating and a review. Once again, thanks for being with us, and I look forward to being with you in our next episode. Enlightened Investors, wait, wait, don't go just yet. I just want to remind you about our recently launched webinar that you will not want to miss. If you're at all curious and would like to learn more about how real estate investing can diversify your investment portfolio, alleviate the anxiety associated with Wall Street swings, leverage your 401s and IRAs to substantially increase the return on your investment, and do all of this with turnkey, hands-off, passive real estate investments, then you'll want to immediately go to stevetucker.com/webinar. In the webinar, we'll also address the common dubious investment schemes, that you want to avoid. To access the webinar, go to stevetalker.com/webinar. I look forward to seeing you in the webinar.

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