345: Client Case Study, Adam Jackson, Infinite Returns for USMC Vet

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Our great podcasts, visit hartmanmedia.com. Welcome to the AIPIS show for accredited income property investment specialists and those who aspire to be if you're a real estate, mortgage or financial professional, this is the place for you. We'll explore innovative investment analysis, sales, marketing and income generating strategies for the most historically proven wealth creator income property. Learn from the experts as they show you how to build a better business and a better life. Hey, it's my pleasure to welcome one of our clients back to the show for a third time and that is Adam Jackson. He was on about three years ago. He's in the aerospace industry. He's a USMC combat veteran. Thank you for your service, Adam. By the way, he spent two tours in Fallujah, so he's probably got some amazing stories there. He's celebrating his fifth year as a real estate investor and he's about to close on his 14th property. And he voted with his feet and moved his wife and four kids out of the Socialist Republic of the Connecticut, right?

That's right.

Not California, to Orlando, Florida. So he's my neighbor not too far away. Adam, welcome back. Thank you for coming back on the show and sharing your client case study story. These are the best shows. And by the way, anybody out there listening who wants to come on share their story, we'd love to have you because listeners just love hearing about real people doing real great things. So congratulations. Now you're basically dollar cost averaging. You're not timing the market, which I think is fantast, and you talk about how you're getting infinite returns on almost half of your portfolio now. What does that mean?

Yeah, so basically what that means is I purchased a lot of the properties over four years ago now and since that time they have not only had the loan paid down based on what I was collecting in rent and how that gets paid down by the tenant, but also the properties have experienced a decent amount of appreciation, actually more than I thought they were going to experience. So. And what's kind of funny is that at the time when I was purchasing these, everybody was saying, oh well, interest rates are great. They're probably not going to go any lower. They probably won't be like this ever again. So you better do it now.

Well, and there was good reason to think that, by the way.

There was. I don't fault anyone and I fully believed it myself.

Right, yeah, me too.

But fast forward four years and now the interest rates are even lower. So you combine that with the loan pay down and the appreciation, I've been able to basically pull out at least as much cash as I put in, sometimes more, in some cases as what the original down payment and closing costs were. And my payment has only gone up by a very minimal amount, sometimes 20 bucks in some cases.

That is amazing. So congratulations on that. So before we dive in too deep, Adam, give us a little bit of your backstory, if you will. Of course, would love to hear about your career in aerospace and, you know, what's going on there. And I think you have, you know, some thoughts about how that's a signal as to what's going on with the economy as well. But, you know, maybe start by when you probably discovered my podcast years ago. When was that? What year was it?

So I would say it would have been 2015 at this point. Yeah. So it's been about five years now that I've been listening to you.

And I remember you attended our Meet the masters event about three years ago, I think. The 2017 event. Did you attend other events as well?

Yeah, I'm not sure if that was with Ron Paul.

No, that was 2018. Was Ron Paul. Okay.

So I went to that. I've been to Profits in Paradise, actually. The most recent one in Orlando, a Memphis property tour, and then the most recent virtual Meet the Masters.

Excellent, excellent. Good stuff. So 2015, and why did you get the bug? What? Interested in you in real estate. Estate or, you know, income. Property.

Yeah. Well, I was always somebody who religiously Contributed to a 401k, a Roth IRA, saving for retirement, living below my means, and that sort of thing. And in the back of my mind, there was always this feeling of, well, how am I really going to save enough? I mean. I mean, realistically, it just didn't make sense to me.

Nobody ever got rich saving money. Exactly.

And so I started to embark on this personal development phase and really kind of into this program. And I listened to all the classic personal development mentors and things like that, but I ended up listening to a book called Seven. Seven Years to Seven Figures. I can't remember who wrote it, but basically it started talking about real estate, and then I thought it was really interesting, got really into that, started to read and read and read, and then I searched for podcasts, and you were really the first one that came up. And once I started listening to it, I just never stopped.

Yeah, by the way, that. That book you mentioned, that's Michael Masterson. He's been on the show. That's a pen Name. So that's not his real name, Michael Masterson. It's Mark Ford. And that's a great book. I also read that book. I'll tell you, his book that I like even better is called and I think you practice this in the military. By the way, the concept, and it sounds weird of ready fire aim. That is a great book of Michael Masterson's also.

I have read that one. That's a great one.

Yeah, I like it. But I mean, obviously you went through boot camp and all of that stuff. You know, when shooting, I hear that some of the training, you know, like the marine training is. Is this concept of ready fire aim. Because I understand that if you actually think about it, if you overthink the shot, you're less accurate than if you just fire it sounds counterintuitive, but. And I don't know if you remember that from any of your training a long time ago, but I just thought I'd mention that because another military vet told me about that.

No, I mean, that's absolutely true. Now, when you're sharpshooting or when you're on the target range. Yes. You will make small adjustments, you will take a shot, you'll see where it landed, you might adjust your windage or your elevation. But I mean, I can definitely relate this more to what my job was in the military, which was on the M1A1 tank. And those are all using crew served fully automatic weapons. So typically what we do there is you start firing and with all the information that you have, you take your best first shot or burst, and then from there you walk it to that target if it's, if it's off at all.

Right.

The concept does hold.

That's a great metaphor for real estate investing. And you know, I think you know what I'm going to say, Adam, because a lot of people, I mean, we have investors who are advanced investors, wealthy that are buying up portfolios of properties, but we also have brand new people that are thinking about doing it. And you know, some of them get in this trap where they want all the information before they do it, and you can never, ever have all the information. So your example of operating the Abrams tank is you've got a fire, get the information from where that shot lands and then adjust. And that's how life is. Right. It's that all of life and investing and whatever is that whole process of doing something, getting information from it, using that information to do it better the next time. Right.

I would definitely agree. And also, once you finally engage. Okay. You Engage that target. A lot of times what happens is you end up finding information out. There might have been certain conditions with that scenario that you were unaware of at first. Maybe you had heard about them, maybe you had trained for them. For instance, the fact that I bought properties going back to real estate and four years ago, I mean, I didn't know if the interest rates were going to go lower. I could have never imagined that. I didn't know if the appreciation was going to happen the way it did. I mean, I invest for yield. So there's all these other factors that you can eventually take advantage of with the information that you learn after you get started.

Yeah, nobody can know all the information or how it's going to work out in advance. You've just got to jump in and do it and adjust, adjust, adjust along the way. That's the only way anything in life works. I mean, that's the way surgery works. When a surgeon goes in and does surgery. Right. It's the way everything works. You just cannot know everything in advance. You've got to give up that need for certainty and just go do things. And, you know, I like to say cultivate what I call rational recklessness.

I like that.

You got to be a little bit reckless, you know. Yeah. Good stuff. Anyway, go back to what you were saying. So you were talking a little bit about timeline and things like that and I interrupted you, so.

Oh yeah. I guess this would just kind of go back to what I was doing with the properties as far as the approach of just consistently buying and not actually timing the market, not actually waiting for any significant kind of downturn, ebb and flow. Just, just continue to do this. Get in control of the asset as soon as you can and let it go to work for you. The trajectory is incredible.

Absolutely. So get in control of the real estate as soon as you can and then let it work for you and then make those course corrections. Right.

And it doesn't take very long. I mean, again, only four years. I had more of a seven to ten year plan, which I thought would have been realistic maybe for some sort of an exit plan or some sort of harvesting equity. But it happened even sooner than I thought.

Good stuff. That's awesome. So which markets are you in? What metro areas?

Yep. So I'm currently in Memphis, Jackson, Mississippi, also Jacksonville and Ocala.

So you Florida too? Yeah. Yes.

So they're nice and local. I can drive to those within an hour. I know not everybody has that luxury, but. But that was definitely a selling point for me. And also Talladega Alabama.

Okay, good, good stuff. And you live in Orlando? That's correct. Fantastic. So how did it start? I mean, you listened to the podcast and then where was your first property?

So the first. Actually what I did was I bought three properties right off the bat in Memphis.

Okay.

And those have actually proven to be some of my best stories, some of my best winners. Yeah, I mean, ever since then, I've really enjoyed the Memphis market. I can tell you though, what I did was I was going through the pro formas from a Memphis property tour. It was really like three years ago at this point. And I could not believe the deals. The way that the pro formas looked, you know, they were just the amount of cash flow and the rent to value ratio. But I was told that even years prior to that, they looked even better. I can tell you that it's never too late to start. And the deal, I'm still finding deals that look great today. So.

Yeah, absolutely, I agree with you. And you use Property Tracker to, to track your portfolio and are you also using it to evaluate new deals? So, you know, it certainly makes you hone in. And you're very familiar with the way that first year projection looks on the pro forma. You know, you've learned how that works. And by the way, anybody watching or listening, if you go to Jason hartman.com, if you do one thing and one thing only, go watch that free 27 minute video on the front page of our website, it's totally free. It will teach you how to read and understand every single number on that pro forma and it'll really teach you how to evaluate a real estate deal. And it's probably the shortest, best course on real estate investing ever. And it's free, so 27 minutes. There you go. But yeah, so at the time when you were buying those properties, Adam, did they feel expensive to you?

Well, being from the Socialist Republic of.

Connecticut, they felt cheap, right?

Yeah, because they were barely in the six figure range. So they did seem fairly inexpensive to me. However, I would still have to make a 20 to $25,000 investment. So I think that maybe just kind of getting over that, especially with the Roth IRA at the time, I think if the contribution was 5,000 or 5,500, and you know, probably something similar to that with what I was doing with the 401K. So, you know, obviously that's a bigger investment. But the thing is, is that the money starts working, the currency starts working for you immediately and you don't have to put it off. So, yeah, I would say it was inexpensive, but still a good chunk of change to me at the time.

Okay, and what were some of the good and the bad things that have happened to you over the years? You've been investing for five years. You're up to 14 properties in all the markets you mentioned. So congratulations on all of that. You said you were surprised, pleasantly surprised, at how some of them have performed and at the appreciation you've gotten. So that's awesome. There have been some lessons along the way, I'm sure. Some things you have, probably some regrets, I'm guessing. Any thoughts? The real world picture is what we want to paint here.

Yeah, sounds good. Well, I mean, I can tell you right off the bat, I have zero regrets. Only because anything that happened that might have been to the negative was actually offset by the lesson, you know, So I definitely learned an important lesson through those negatives. I can tell you that at the time when I was going through and harvesting all this equity to dump back into the other three properties that I'm acquiring just in the last few months, I can tell you that those properties performed very, very well in general. And I think a lot of that might have had to do with where I bought and what I bought. But I can tell you that the cash flow has been pretty solid for the most part. Now. I have had some issues. I think it's very important to stay on top of your management. I think that if you have some sort of a charge that you need more detail on or maybe just want a question for certain reasons, I think it's very important to stay on top of the management. Absolutely Demand those answers, you know, demand the answers. Demand the pictures or receipts.

Yes, absolutely, absolutely. Something like that.

I can't hammer that home enough. And don't be afraid to. I mean, if you have to, I mean, have a healthy amount of tension if you have to do that. And let them know that you're not afraid to take your service or your business elsewhere.

Absolutely. Couldn't agree more. Now to that end and we've, as you know, have been really pushing and teaching people how to do self management, long distance self management, which, like I've said many times, if you asked me if that was possible 13, 14 years ago, I would have said no way. But it's totally possible and we have all these great tools to do it nowadays and we just launched the empowered investor inner circle, all of that stuff to, you know, our goal is to help, you know, thousands and thousands of investors really take control of their properties by Doing self management. And the amazing thing I find is that sometimes because you get that third party, that intermediary, that middleman out of the way, it's actually easier. It actually takes less time. Now, it sounds like you're not doing any self management yet, but. But you probably thought about it. I don't know. Are you self managing?

I've thought about it a lot and actually I was very, very close to firing a property manager at one point to do that and then we ended up improving the situation. So I didn't actually do that. It has been on my radar and that's partly why I bought in Florida, although I've had no issues there, of course, but that's definitely something I'd be willing to entertain. I think it's a great thing to do.

Yeah. Just the fact, Adam, that you. Hopefully we've conveyed to you that you have the confidence to do that, it puts you in a different negotiating position when you're asking for justification for an expense from your property manager. Now you can do it hopefully with some more confidence, with some more guts to say, look, if I need to pull the plug and get another manager or just self manage, I know there are options and it's going to just make you a more powerful, confident investor, right?

Absolutely. And I think it's kind of funny because I'm seeing parallels between my initial reluctance to actually purchase a property and now fast forward four years or maybe even a little bit more. And now I'm sort of at that same crossroads with, okay, well now do I take these matters into my own hands? Do I take the plunge into self management? So that's one of the things I'm definitely thinking about. But going back into the portfolio, some of the good, some of the bad, again, most of those properties have performed very, very well. I'm at infinite returns on many of them. I can tell you though, actually this is a good story. My worst performing property, I purchased it three years ago and it was at the lower end, so probably closer to maybe a C property. And I finally had my first month of cash flow in about two years. So think about that. I mean, I finally got it stabilized, I think. But what's funny is that when I look in my property tracker and I look at the overall return, I'm still looking at a double digit. It's a 15% return.

Right.

So, you know, it's funny because you, you have alluded to or talked about in detail in the past. If the deal only goes half as well as it's projected, you still get these double digit returns.

Yeah, right.

And that's what I'm seeing here. Between appreciation, tax benefits, but the lessons, I think that's priceless.

Absolutely.

That's my one bad egg though. I think everyone may get one at some point.

So your worst deal is 15% annual return on investment.

That's right.

I love it.

Hard to believe.

Yeah, that's the worst deal, folks. It only gets better.

Yeah, I wouldn't have believed that. My.

And that's a lower end property in terms of what we sell and what's in your portfolio, right?

Yeah, it's a lower end property. But I can tell you that I have another lower end property. I only have two in the portfolio and that has been outstanding. I have a Section 8 tenant in there and the rent comes in like clockwork. There's hardly ever a repair. The tenants are all leasing up. But that's another thing. Every single day. So many renewals on leases this year, it's just incredible. So, you know, I can tell you that all the properties that I have there are currently leased and I collected every rent last month, including back rent from a property that was missed from the previous month.

Okay, so that's a good question. So at the time of recording now, you know, we're sort of in the midst of the lockdowns, are spotty some areas, some not, but you know, every. The world's a mess right now, right. And there's been a lot of talk about rent strikes and evictions, moratoriums and stuff like that. Has everybody been paying your rent all the way through this or is that just last month that you were referring to? Or tell us about the experience on rent collection.

Okay, so that would be specific to last month. I can tell you though that everything has been very, very consistent. I mean, there might be one property that I don't collect rent on for a given month, or maybe it's going through a turnover, but that's generally the average, I would say one property out of the double digit properties that I own. I might miss the rent for some reason or another, but I just thought it was a testament to a lot of the fear that has been out there. And I remember months ago we were wondering, I mean, okay, let's build up the reserves. This could be bad. You better hang onto your hats. And I think this is just a testament to the fact that every property that I have is currently leased. The leases are being renewed and last month in particular I collected every rent.

Yeah, that's fantastic. So the asset is just Much more resilient than most people think. Adam, I want to go back to that comment you made because I'm not sure everybody really understands it on your worst performing property and how some people in the income property investing game and the real estate game, they think they're losing when they're actually winning. And the reason they think that is they don't know how to do the math. They just don't know how to calculate it. They don't understand that like an iceberg, most of it is below the surface of the water. And there are all these things giving you return on investment because it's a multi dimensional asset class. And they don't see it. You don't see it right away. Sometimes you don't see it until the end of the year when you keep the books on it or when you do your taxes and you get a big tax deduction or whatever. Right. But speak to that a little bit more and maybe help our listeners understand that a little bit.

Yeah, I'm actually glad that you brought that up, just because recently I had spoken with another investor who purchased a property. They tried doing it for only one year and had a major repair. This was just somebody outside of the network and they did it on their own and it basically wiped out whatever their projected cash flow for the year would have been. And I think it was at that point, I mean, I basically told them some version of what you just said how there's just a lot happening underneath the surface. And I took it upon myself to go in and really do a deep dive on my returns and the calculations there. Now, at the time of the, I guess it would have been 12 properties I had, I was looking at roughly $3,000 a month in cash flow, which I think is pretty good. I think those numbers are pretty solid. But what I did was I took into account the appreciation, I took into account the loan paydown and then projected tax benefits. This does not include inflation, paying down the value of the debt or anything like that. And that $3,000 turned into between 15 and $17,000 per month for the total return. So it's actually pretty amazing when you look past the cash flow, what's really going on, especially if you leverage these properties at a 5 to 1 or 4 to 1, you're really looking at some incredible returns.

Yeah, yeah, you are, you are. And because you get, you know, like people, most people just look at the cash flow and they think, I mean, I remember there was a comment on one of my YouTube videos the other day. I didn't have time to respond to this skeptic. You know, I'm not going to convince them. I just give up on some of these people. They just don't get it. You know, you're either going to get it or you're not going to get it. Right. But this one guy watched the video, I guess, and, and he commented, how is this possibly worth it? I'm going to buy a property and get $200 a month. So what? And it's like, oh my gosh, if you just took the time to understand. I mean, to that guy, I want to say, okay, look, I'm not going to try and explain anything to you or teach you how it works or how to calculate return or anything. Just ask yourself this simple question. How is it that you know and I know because everybody knows them, right? So many people who created a lot of wealth through income property, yet you probably don't know anybody who did that in the stock market or buying gold or, I don't know, maybe bitcoin if they timed it right. But, you know, I don't think that's a sustainable investment. How do they think it works? Because they certainly have looked around and they know lots of people have become very wealthy through income property, yet they still don't take the time to understand it.

I think a lot of this has to do with the infrastructure around what we look at when it comes to Wall street and the conventional wisdom as to what investing actually is. I mean, I know that we've all talked about this, but income properties are outside of that system, so there's no one that's going to be pushing that. But again, like you say, the wealthiest people are the ones who either have made their fortunes in real estate or who put their money in real estate. And there's good reason for that.

Yep, you're absolutely right. You're absolutely right. Do you want to talk about, you know, any thoughts? Being in your industry, being in aerospace and the economy and what's going on? You said that you've been doing very well through all this. Your properties are obviously doing very well. So congratulations on that. But just, you know, we all want to know what's coming next. What's the real read on things that are going on in the world? And this is very uneven, this whole economic situation. And it's, it's very sad. A lot of people are struggling, but a lot of people are just doing great at the same time. You know, it's really mixed. Mostly in a recession, you know, it's like 80% of the people will be suffering. But this time it's, you know, it's like 50, 50 or maybe, maybe even better than that in terms of most people are doing pretty well, you know, 60, 40 or something. But what are your thoughts?

Yeah, I mean, it's, it's actually very interesting to me. You know, as somebody who works in the aerospace industry, you. There's a lot of technology and up and coming programs, I guess, that are expanding upon these and different militaries are working with one another. So, I mean, militaries are definitely going to continue to increase, especially with the way the political landscape is today. But, yeah, if you're a professional and you have the ability to work from home, you are definitely in much better shape, especially if you're within an industry that is getting some sort of government funding in particular or, you know, has some sort of market need where, whether it's some sort of a digital transformation or technological, you know, I guess innovation is needed. So I definitely think that that's, that's a factor. And. But Jason, I would also like to ask you, I mean, how do you feel about this as far as the fact that you have a stock market that does some sort of a flash crash, it seems like, comes right back up, may be going back down. At the same time we have these interest rates that are incredibly low and we have a housing boom. I think there's a lot of sectors in the economy that are just detached.

Yeah, they are. You're absolutely right. The stock market is just fake. I mean, it's smoke and mirrors. It's just a totally fake thing. So they've obviously propped it up with all the money creation. I think we're up to about $5 trillion now. This is absolutely unrecognizable in history. What's going on. There's just no comparison. But like I've said and you've heard me say, I don't think the chickens are coming home to roost anytime soon in terms of the ability for the US to create fiat money. This is a thing. It's like, interesting. Cause I was listening to Peter Schiff yesterday on George Gammon's show, and Peter's been on my show before. I got to get him back on. But he's so interesting to listen to. But he's so wrong. He's just always wrong in the sense. I mean, I don't know, it's kind of like divided. He's not always wrong completely, but he's talking about, again that I've heard him talk about. For the last 15 years about how the dollar's over, the dollar's going to crash, the US is going to lose reserve currency status. And I'm thinking to him, I want to say, well, obviously, compared to what these people love to say, the US is in such bad shape. But compared to what? I mean, who's going to take over the reserve currency status if not the us who is in better shape than we are? There's nobody. It's definitely not China. China is a disaster and a half, and it's going to only get worse. I mean, yes, they've had a miracle for a few decades. And if Trump is real and the continuation, you know, we have this continuation of moving jobs back onshore. I mean, China is going to suffer from that, no question about it. And China is, you know, running a fake economy in a huge way. They're manipulating their currency like crazy. They've got 10 more years until they have a giant demographic cliff, as Harry Dent talks about. That's actually the title of one of his books, and China is not the Thing. And now after coronavirus, nobody trusts China. Their trust level on the world stage has just been massively diminished. You know, I was there last year and it was really enlightening. I loved it. You know, I would totally love to go back, but. And then with what they've done in Hong Kong clamping down on, you know, the protesters and so forth, China is not gonna be the thing, and it's certainly not gonna be. Let's go down to number three, Japan. Are you kidding me? I mean, giant demographic cliff. Also, country l will not exist in 70 to 100 years. There won't be any people. You can't have a country without people. They're not having any children. They have no immigration to speak of. So the country will just evaporate. It'll just go away. It's not going to be China, it's not going to be Japan. With 230% debt to GDP ratio in Japan, Is it going to be the Eurozone? Europe is a disaster. Is it going to be Germany? I mean, is it going to be the uk? No way. There's nobody to take the place of the us. It's just. It's absurd. These other.

We have good reason to be bullish on the US and even more bullish on US Real estate. I just think it has a great Runway. And especially with all this money printing, I think that we're going to benefit as real estate investors.

You're certainly right. And then. And by the way, I just want to make the disclaimer. I am by no means suggesting that the US Is perfect or anything. It's a disaster. It's just comparatively, you know, compared to what is the big question. And comparatively, it's in much better shape than any other major country. Okay. There's just no comparison. So that's that. But, you know, what do you think about the demographics of the market in terms of home buyers out there pushing prices of the properties you own and I own up because there's a lot of buyers, but also renters. Now we don't have to just talk about millennials anymore. We can talk about Generation Z. They're starting to come up into their own. And these are huge demographic cohorts. I mean, the population is giant, as you know. I remember one time it was gross when I was maybe in junior high school, in one of our classes, maybe it was like biology class. They had a snake, a big snake, and they fetted mouse. And I, you know, I watch the whole thing and, and what's interesting is you watch that long snake and then that big lump of the mouse going through the snake's body. It's just gross. I'm sure people have seen this. If not, look up a video and you can, you can see it happening. But that's how the demographics are in the U.S. we've got these giant lumps of demographics. 80 million millennials, okay? And they're moving into their spending years and they're going to move into a giant wealth transfer era where that wealth is going to be transferred from their parents as they pass away.

So, wow, it makes me wonder, well, is there really any stop to this? I mean, are the prices in certain areas, of course, going to keep improving? Because based on everything you just said, there is a good likelihood that that happens Now. I think it's also important to make a distinction between which of those markets are going to benefit most. And I think we know what most of those are. But, I mean, I can tell you an example. I have a brother who lives in Brooklyn, and he was just recently looking for a new lease, so he moved. And what's incredible is the downward pressure we're all seeing on rents in that area.

All of our clients who live in New York City or the surrounding areas like Brooklyn, they say that there are just moving trucks everywhere, people are just fleeing the city. And if not, like your brother stayed in and he probably got a huge upgrade for a lower price. Like, literally people are moving from one bedroom units in New York to three bedroom units for the same price. It's amazing what's happened how these cities, and I don't want to just say New York, but San Francisco, Louisiana, they are all in collapse mode right now. Yeah, go ahead with what you're saying though.

Oh yeah, well, I think in his case he ended up getting another bedroom and I think at the overall rent dropped by about 10%. So just kind of give you an idea there. But yeah, it's pretty interesting though what's happening also in the tri State area. So when talking about New York, Connecticut and New Jersey, I've actually seen a good amount of price appreciation in areas of Connecticut and things like that. But that's because people are leaving the city. So you know, relatively speaking that's an improvement for them.

You've got the moneyed people in New York City who have left and they've gone to, you know, Westchester County, Connecticut, the Hamptons and they're definitely pushing prices up there as their money floods out of the high density areas. But again, those properties wouldn't make sense as investment anyway because they're just too expensive to ever get a decent rent to value ratio. So what we're looking for is the middle and lower middle class tenant that is going, that is, you know, just there's a flood of money going into these cities and these type of properties that make good sense as rental properties. And our investors, like you, like me, and hopefully everybody watching and listening are really profiting from that, aren't they?

Oh yeah, I would say so. And again, none of us, I feel like we wouldn't have been able to predict this. We were sort of in a mode just in recent months where it was okay, okay, well let's hunker down, let's get our reserves in place and let's see what happens. But yeah, I mean really what's happening here, especially going to the cities in which we invest, where there's job prospects and where there's business friendly areas and jurisdictions. Yeah, I mean again, we're all going to be set up very, very well if we continue to purchase there and dollar cost average there.

I completely agree with you. I know you use Property Tracker and that's great that you're using the software. Are there any other apps or tools or you know, resources you're using that you want to share with investors?

You know, I mean at this point really I pretty much just use the property tracker. It's really all I need. I mean I use things like Zillow and Trulia and things like that just to kind of get an idea. But for the most part, that's really kind of what I'm using. Shadow Stats is something that I've really been starting to look at.

Yeah. More.

Which I think is great.

We had the founder John Williams on the show before.

Okay, very cool. And so I pretty much, I think when something is, when something works, I like to double down on it. So. And for instance, I don't even think I've talked about this yet, but one of the things that I do at this point since I've reached my maximum loan slot amount for Fannie Freddie, is I take a certain grouping of properties, I refinance out into a non QM.

Mortgage product or loan, which means qualified mortgage.

Correct. And then what I do is I free up those Fannie Freddie spots and I put down 15% on the next properties that I buy. And that's all I've been doing at this point. So, you know, I like to use property tracker just because we look at these initial canned pro formas. But when you're putting it down a different amount, I really kind of want to see what the projection is going to be that. Especially 15%. That's a bit different from the 25% down, especially because you're going to have, I mean, you're going to just accelerate your total roi.

That's fantastic. You mentioned, and I didn't even ask you enough about this, so sorry about that. We got to talking about other things, but the infinite returns on almost half of your portfolio, you say you're getting infinite returns, what does that mean? I mean, I know what you mean, but I don't know if people listening know what you mean. So tell us more.

Yeah, of course. So infinite return basically means that the money that I put down to initially acquire the property, I have gotten that back in returns, but I still hold onto the asset. So for example, I have one property actually was in Memphis and this really was the first property I ever bought. But I put down $25,000 initially to purchase it. It was originally 100k when I bought it and that included the closing costs as well. So I put 20% down.

Down.

Well, fast forward four years, it's been an excellently performing property. I get cash flow every month. It's been the same tenant, by the way, every time. And I just did a cash out refinance, pulled out 24k and my payment went up only by $20 a month because the interest rate went lower. So for $20 a month, I get $24,000 back out. I still hold onto the asset and it still cash flows $300 a month.

Month.

Every time.

I love income property. It is the best thing ever. You know, what you're talking about is phenomenal. I mean, you get all your money back and you still own the asset. Where else can you do that, folks?

I mean, not only that, but I mean, let's keep in mind that when I did the refinance out, I initially put down 20%. I refinanced out and now have a 75% loan to value. So I still have all of that equity that sits in that property in addition to the cash flow every month and the loan pay down. So there's no telling what that property is going to actually return in the future.

Excellent. Good stuff. Well, Adam, first off, thank you for your service and thank you so much for sharing your story, too. Thank you. And service. I mean, military service, of course. And just anything else you want to share with listeners or viewers that I had a question. I didn't ask you or anything. Or maybe your plan for the future. Whatever, it's all yours.

Yeah, well, I mean, plans for the future. I'm just going to continue to buy. I mean, once I find something that works and works well, there's no reason to try and reinvent the wheel. So I'm going to definitely continue to increase the portfolio, hopefully at an accelerating rate. And then if I could add anything else, it would just be get in control of the asset. That's the most important thing. You can always renegotiate the deal after you have it.

Right. But.

But the most important thing is to get that money to start working as quickly as you possibly can, because that's when all of these other opportunities and options begin to show themselves and become available to you.

Yeah. Good stuff. Good stuff. Well, Adam, thank you so much. We really appreciate having you on the show. That was a great client case study and glad to have you back on the show. Thank you.

Hey, my pleasure. Thanks for having me of me.

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