CW 927 - Rich Dad Advisor Ken McElroy on Property Management, Top Investors Mistakes, and Economic Optimism, Part 1

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Welcome to episode number 927. 927. This is Jason Hartman. Thank you so much for joining me today as we are nearing Christmas time. Happy holidays and Merry Christmas to all. We are in a period of really unprecedented economic optimism. There are many people who hate President Trump out there and, you know, a lot. I don't blame some of them. I mean, he's, he's a controversial guy, you know, I mean, he says some stuff that is like, wow, why did you say that? Trump? That's just crazy. And, you know, some say it's because when he says those wacky things, he says he gets to control the media cycle. Maybe it's a stroke of brilliance. I really don't know. I am. I've still got a question mark after a year, right? Well, almost a year of his administration. Regardless, love or hate Trump. And for those who think I'm some big Trump promoter and are trolling me on the Internet and writing bad reviews, because there are the people who can't hold two opposing thoughts in their mind at the same time, which is a sign of low intelligence, by the way. Yes, thank you. I'm sure I'll get some hate mail on that one. So, you know, here's the thing. Get it, okay? Please get it. The guy can be great for the economy. At the same time, you. You can hate his guts and at the same time, you could not even vote for him. He can still be good for the economy, and that is what I predicted. Thank you to one of our actual celebrity clients who text me last night saying, you predicted that over a year ago. And I did. So, another one of my many predictions coming true. Now, hey, I get many of them wrong. Too. One again, I will remind you that I've been fabulously wrong on for a decade. If is interest rates terribly wrong? Jason, you are so wrong on interest rates. Yes, I thought they'd be much higher by now, but they've been artificially low. What can I say? Wrong, wrong, wrong. But right on so many other things, including rental rates, prices, zillion other predictions that I've made over the last 926 episodes. So go back and listen and hold me accountable. And that's one of the reasons we do Flashback Fridays, so you can hold me accountable and see what I was thinking 10 years ago, 5 years ago, 12 years ago. You know, this is one of the oldest, longest running real estate investing podcasts on the Internet. We started back in the days when nobody knew what a podcast was. So here we are continuing, continuing as we near episode number 1000. So thank you to my loyal listeners in 164 countries around the world. We appreciate you. But listen back to the thing. We are at a time of unprecedented economic optimism. Okay? And the GOP tax bill, the Trump tax bill, call it, whatever you call it, it's gonna pass. It looks like it's sailing right through and it's gonna happen. And hey, it's not gonna be great for everybody. I completely get it. But it's gonna be great for the vast majority of people listening to me right now. Most of you will benefit from this. Now, those of you who own high end homes in those expensive real estate markets with high income tax or high, well, income taxes and property taxes, both, you are going to suffer on just those parts of the. Well, not, I don't want to say that's the only one, because the tax bill's complicated. It's complicated. But those are some major areas where you will suffer. Okay? If you live in these high tax, high real estate price and you own a home, own an expensive home. If you live in those jurisdictions and own an expensive home in those jurisdictions, that will hurt you. But so many other things about this bill will help you. If you own a lot of real estate and you've been following my plan, you know, look at income. Property is the most tax favored asset class in America. It's the most historically proven asset class in the entire world. You're going to benefit. I mean, this is, this is a good plan and, you know, where everybody's going to benefit. Here, here's something that happened to me recently. I was at one of my several storage units. I pay a lot of money in storage fees. You know, try Owning several businesses and they have, you know, stuff and files and equipment and, you know, this, that and the other thing when we do seminars and things like that. And then I got, you know, I've moved so many times. I'm going to move again, by the way. I'm going to move, move to another city because I really like moving a little bit and trying some different places. You know, when I lived in Southern California, a beautiful place, by the way, in Orange County, California, Irvine, Newport beach, you know, I felt kind of trapped for many years because my, in the traditional real estate business, it was a very localized business. I couldn't move, you know, and now I can live some different places. So I'm thinking about the most financially friendly jurisdictions. I moved to Las Vegas just over a year ago, a year and a half ago almost, to finally live in a no income tax state. But I don't love Las Vegas by any means. So I'm going to try another one and I don't know which one it's going to be yet. Will it be Washington? Will it be Texas? I don't know. We'll see. Will it be Florida? Will it be Tennessee? I don't know. I just don't know. But one of the criteria is no income tax state. I would encourage you to start planning your life in a way that you can do that. Low cost of living state, no income tax or low income tax state, and a low property tax state if you're going to be a homeowner there. Okay, so those are some things. So recently I was at one of my storage units. I found a big giant box of old photos. And I bought a photo scanner for 550 bucks. Kind of expensive, but a very good scanner. And I started scanning them myself. You know, I was going to send them away to one of those services. I've done that before for these old paper photos, right. And scan them. But I just thought this time I'd just do it myself. And so I did it. I scanned all my old photos. They're all now digital, preserved for posterity. Okay, so hopefully someday I'll have children and then they'll have children and so on and so on and so on. And the legacy will continue. Someday, maybe my kid will be doing this podcast. Who knows, maybe there won't be any such thing as a podcast by the time I get around to it. I'm awfully slow at this. But anyway, here's the thing. I saw this old picture that I, I found when I got to meet Arthur Laffer, the famous Economist who worked in the Reagan White House, Arthur Laffer. Now, of course, he is the one who invented the Laffer Curve. And I want to get Arthur Laffer on the show. I sent the picture to our guest booker, and I said, hey, here is my photo with Arthur Laffer, right? I got to meet him before. So let's get him on the show to talk about the Laffer Curve. And this is what the GOP tax plan is going to do. Another one of my predictions. I could be wrong. It's just a theory. It's just a theory, but it is going to take advantage of the Laffer Curve that basically tells us that there's a certain sort of optimum spot, a sweet spot, if you will, right, where the economy is doing really well and you have incentivized all of the players, all of the actors in the economy. That's you and me and everybody we know, because we're all actors, all the. The economy. You could apply the economy to Shakespeare or Rush, the band. Rush, okay? They have that great song. It's called Limelight. All the world's indeed a stage, and we all are merely players, performers, and portrayers, each another's audience, okay? And so that is true in the economy. We're all actors in the economy. And we're all making all these decisions based on our own self, right? That's the way capitalism works. And it's not all bad, okay? It's a really good thing. It's the, so far, the best system going. And so this GOP tax plan or Trump tax plan, and, you know, it's been watered down. It's not the Trump plan anymore, I guess it's more the GOP plan. It is going to make the economy boom even more than it already is. And what that is going to mean is that is going to mean increased revenue for the government ultimately, even though the projection is that it will increase the deficit. Right. And ultimately the debt, because one influences the other. But, you know, those things are so hard to predict. And you know what? As much as I'm against all of that, and you know, when you hear Ron Paul speak at our upcoming Meet the Masters event, you'll hear him talk about sound bunny and ridiculous government spending and all of this stuff. And, you know, I agree with him, certainly. Okay? And he was on the show recently. But this house of cards game that our government and other governments around the world play when they can, can create their own money out of thin air, you know, who knows how long it can go on? It can go on For a long, long, long time. I've been on a little bit of a binge lately, I have to tell you. An interview binge where I have been interviewing every expert in the cryptocurrency world. Oh my God, I have talked to all of them. I did one this morning. Another interview, I did another one yesterday. I mean really, really bright people. And I'm telling you another prediction is I don't think this bitcoin thing is going to work out that well. I don't think this crypto thing is going to work out that well until and unless there is a cryptocurrency that is backed, if you will. Yes. It's not back anything. The dollar. Right. I can hear them now. Backed by our government and our Federal Reserve and other big governments around the world and their central banks. Those are the cryptocurrencies that will be the success stories. So we're still very early in on this game. We will see how it all pans out. Now our guest today is Ken McElroy. We're probably like we did with the last interview, we're probably going to go a little long. So we'll probably do this one in two parts. We're to going. We are really trying, although I've never been accused of being short winded. We are really trying to get these episodes down to a half hour each. Okay. And so we'll probably publish part two of this Tom or the, you know, tomorrow, the next day. Right. And so we'll have it on both because I gotta play an important video for you. This is with Steve Liesman. He's a senior economics reporter with cnbc. All probably know who he is. Listen to this, listen to this. It's, it's really quite amazing. Here we go.

Was here a quarter ago breathlessly talking about the rise in optimism. I don't know what the next step up is above breathlessly because we have done it again. We've surpassed the old hyperventilate. I don't want to hyperventilate. But folks, we have this surge in optimism and it appears to be helping at least a little bit the approval rating of President Trump. Take a look at the numbers here for time. The first, first time in the history of the survey and folks, we've been doing this for more than 10 years now. 51% of the public says the economy is good or excellent. We have not been at 51%. You can see it rose steadily under President Obama but it absolutely surged under President Trump.

And by the way, this is the.

Life of the survey.

This is the life of the survey that we're looking at. Absolutely. And then 41% of the public says that the economic outlook is good or the economy will get better in the next year. You don't see it here. 50% of the public said it's a good time to invest. They're upbeat on the outlook for their wages. They're upbeat on the outlook for housing. And then take a look at the next set of screens and we'll show you how this may be affecting the approval rating of President Trump. You can see that his approval rating went up by four points and his negatives came down by three points. This is the approval rating, by the way, guys, is in line with a recent trend. You can see in some, some, some polls. This 40% over above, getting rid of the three handle, getting the four handle.

Our still having half the country disapproving with economic numbers like that.

But I think it's more than even. I think, I think he's underperforming relative to the economy. But then take a look at the next screen back, which is his economic approval ratings. And those are better. Yeah, he was already net positive in our poll, 4341. Now he's positive, 4743. A little bit wider there. And you can see people approve of his economic handling of the economy, while less so the overall. And I want to just show you the trend here, which is the next screen, guys, is the net approval. We do approval minus disapproval. You can see he had a very bad summer and then it's come back to where it was. He's minus seven. And on the economy, he's plus four right there. What you don't see the question is why is this happening? One thing we know for sure, Republicans have come back home, they've dug in, they had abandoned him a little bit. In other words, his numbers with Republicans were not as high as they should have been. They're back where they are. Independents a touch more positive, Democrats a touch more positive. But it doesn't seem to be the tax bill, because I'll tell you, the tax bill does not poll very well. Just 26% approval overall of the 800Americans we polled nationwide. And it's even tepid among Republicans. Just 56% approval among Republicans, I think that is. But hold on, let me just tell you the other side of that. There's a large don't know. There's a big 30% don't know in our.

Because we still don't know a lot.

Of the final details.

So I think that's probably it. But I think what we're seeing here is the economy really helping out the president and we'll see what the upside here, how far it can go. There are obviously other things that keep people from backing the president.

They say people vote with their feet in the stock market.

Right.

So I know you, it's global synchronous growth. But stock market's going up has to do with the tax bill. So people voting with their feet to control the money are voting in favor. You'll never get a tax bill very high. And then the as far as the approval rating for Trump, what do you think, Becky, the maximum approval rate, what do you think his solid negative number. That will never change.

Will never change.

45 minimum. 45 minutes.

45.

Impeach him. 45 would be impeachment.

No, no, I don't think 45.

I do, I think 45 at least just with the tweets and the, you know.

Yeah. If you took tweet, I'd love to.

See if you took Twitter out of this. No. Well, or just in general.

We asked that question a while ago. People want him to stop tweeting. You saw that Republicans wanted to say.

Yeah, but it does. It works for him.

So I hope you found that video interesting. We've got to get to our guest, Ken McElroy. But before we do, I want to remind you we are wrapping up the five year plan contest. Go to jasonhartman.com contest Jason hartman.com contest meet the masters we got a new landing page. Make sure if you're interested, you upgrade your tickets so you can enjoy dinner, an intimate dinner with Ron Paul. And you can meet him and get a photo op and get access to the green room and all of the rest of the good stuff at our upcoming Meet the Masters event in La Jolla. If you haven't registered, of course, you want to get your tickets for that ASAP. Jason hartman.com masters for that Jason hartman.com masters and remember, income, property is the most historically proven asset class in the world. We're going to go to Ken McElroy. One thing during this interview with Ken McElroy, the rich dad advisor, great guy. He talks about how I spoke at his conference last week. It was great. It was his annual employee retreat. I was honored to be one of the speakers there. And during my keynote speech, I talked about something called the Wheel of Life. This is something that I learned about from one of my early mentors at age 17 who changed my life. That was Dennis Waitley, along with Zig Ziglar, Jim Rohn, and Earl Nightingale, my four great mentors who really changed the course of my entire life. The Wheel of Life is about life balance. What some of the speakers that teach on this Wheel of Life concept, where you sort of rate on a 1 to 10 scale different areas and aspects of your life, they talk about making your wheel round so it will roll through life really well. And I agree with that. That's a, that's a good point. You know, there can be, as Stephen Covey, another great mentor of mine, talked about, the late Stephen Covey talked about, you can have seasonal imbalance. It's okay for things in your life to be imbalanced, just as long as they're not permanently imbalanced. You know, if you're engaged in a special project or a campaign or whatever it is, you know, you may be imbalanced for a while. Don't beat yourself up about it, but try to ultimately correct that where you. You have more balance. Okay? But the other thing that speakers don't talk about when it comes to the Wheel of Life is they don't talk about the fact that your wheel should be large. Okay? Because if you rate yourself, and we'll probably do an entire show on this, or I'll get the audio from Ken of my speech and I'll just play it on the podcast for you so all of you can hear it. But if, if you rate yourself a one in every category of life, well, your wheel will be round, okay. But it won't be very big. That won't be much of a big life. Right. I think the goal is to have a kind of a big life where you're doing a lot of things and engaging in life and having some adventures and a lot of satisfaction in every area of life. So hopefully you get a 10 in all areas or an 8 or a 9. Right? And you have a big, big wheel, but also a fairly even wheel, because remember, a small wheel, like maybe the wheels on your luggage or, hey, your skateboard, if you skateboard, right, Those get stuck in a rut very easily. The larger the wheel, the easier it can go over bumps in life and, and get through ruts in life. Right. If the wheel is small, it's going to get stuck. So I just want to share that one little example. But let's get to Ken McElroy, and we will have part two of this interview tomorrow on the next episode. So this week, hey, we're doing five episodes this week. I Hope you're excited. Anyway, here's Ken McElroy, rich dad advisor.

It's my pleasure to welcome back a returning guest and that is my friend Ken McElroy. He is the epitome of the word entrepreneur who for over two decades he has experienced massive success in the real estate world. From investment analysis and property management to acquisitions and property development. With over 700 million investment dollars in real estate, Ken offers a unique perspective on how to get the biggest return on investments. He is also, of course you know his name because he's been on the show before, but he's the author of the best selling books in the Rich Dad Advisor series, the ABCs of real estate Investing, the Advanced Guide to Real estate investing, the ABCs of property management. His newest book on entrepreneurship is the Sleeping Giant. He's an advisor to Robert Kiyosaki of the Rich dad company and they have co authored several audio programs including how to increase the income for your real estate investments and how to get your banker to say yes. How to find and keep good tenants. He's a chapter to contributor to the newly released the Real Book of Real Estate. Hey Ken, welcome back. How are you?

Great, Jason, great. Appreciate being on the show again. I always appreciate the opportunity.

It's good to have you back and it was great to see you last week. Thank you for having me as a speaker at your annual corporate retreat. What a great group of people you have. I just thoroughly enjoyed myself and I think they enjoyed my presentation too. I hope so.

They did, yeah. You did a great job, you know that. But Wheel of Life, it's a, it hit everybody. I got lots of comments and people loved it. So thank you very, very much. We try to educate our folks through personal development and it seems to be paying off or, you know, we have a very, very low turnover rate in our company.

Yeah, yeah. That's fantastic. Just to give a little overview of your company, you know, how many employees do you have? You have, you know, you kind of have two sort of concentric circles of, of employees. The way I would look at it, you have like your corporate people in your corporate office there in Scottsdale. And I've been to your office before and then you have your big circle, which is all the different people on site at leasing offices, maintenance people, property management people. How many are there? It seemed like there were probably, I don't know, 130 people, I'm guessing at the event.

Yeah, yeah. So we had, what we did is we flew in managers and maintenance supervisors from all our properties. So we have almost 10,000 thousand units. We like to have them here in Scottsdale once a year, and we study a book together. But all in all, I think we have just under 300 employees all together.

Wow.

Corporate office.

Wow, wow, wow. That's amazing. That's a lot of employees to manage. And gosh, you know, 10,000 units. You know, Ken, I think you're upping my own personal goal now.

I'm. I'm green with envy over here. That's awesome.

As you know, it's a overnight success.

Yeah, you're a 20 year overnight success.

Yeah, exactly.

Right, Exactly. Good stuff. Well, hey, Ken, I want to talk about a few things with you. As I mentioned in the intro, you know, we're going to talk about the economy in general. Maybe we'll talk about the homeownership rates and some best practices in property management, because as any legitimate real estate investor knows, it lives or dies on property management. You can watch the late night infomercials, you can read the books, go to the hypey seminars and the pitch fest, but you know, at the end of the day, this is kind of a mundane business. It's just to do the right thing every day and you're gonna make a ton of money because it's the most historically proven asset class in the world. But you gotta be willing to set up the right practices and the right things. So, you know, maybe since I kind of teed that one up more, maybe we'll start with that. I don't know. Where do you want to start?

I think it's a good start. I think a lot of times, Jason, there's. There's two things that I see as, you know, two common mistakes that I see. The first one is people get caught up in the hype of flipping. And as you know, there's a time and a place for that if you're going to do it. But you do pay a lot of tax and then you got to buy something again. So finding a good real estate deal typically for me has been the hardest thing. And so I like to keep them, I like to cash flow them. And so I think when people think of real estate, they think of, you know, timing a market. You know, buy low, sell high, kind of like a stock. So I think that's a common mistake and that's completely different than what I do. As you know, we don't, we don't sell hardly anything.

Right. And Ken, let me just. Before you go on, let me make a comment on that. I have definitely noticed over my Decades in this business business that the people who flip and who, you know, do the, the fix and flip type model, they have spending money, but the people who buy and hold, they have real wealth. And you know, the end of the day, I'd rather have real wealth than spending money. I mean, spending money is, okay, I'll take it. But you know, you pay so much to the government when you flip these properties. And, and you know, it's, it's just like the good sustainable sort of value investing philosophy that is yours and mine and, and Warren Buffett's, if you want to use a stock metaphor, is to just buy it and hold it. You know, I completely agree with you.

It is, yeah. And it, you know, and I'm speaking from experience, you know, because I, one of the things that I did in my career since going back 15 years is I did condos. I did condo deals and condo conversions and condo projects and, and a whole lot of effort to sell thousands of condos, you know, over like a four or five period. We were very successful. Our company made a lot of money. We, you know, we had a great, great organization, but once we were done, we didn't have any real estate left. We'd all made a bunch of money. And, you know, the company shrank down again because there's no revenue coming in because all the condos were sold. And so you're always having to go out and buy things to keep things going. And unfortunately, or fortunately, real estate cyclical cycle, so you can't buy throughout your career. There has to be a time when you have to step back and then come back in and then, you know, buy and then step back.

Comment on that. I have never met anybody who can really reliably predict the cycles. I mean, you can take some good educated guesses, but, you know, it's just hard to know. I mean, you know, you just, just value invest and you can just buy things that make sense and hang on to them. You know, it's pretty simple.

It's surprisingly simple. And so I just, you know, Jason, as you know, that was a big, big lesson for me because 15 years ago I had cash, you know, I had nice things, but I did not have wealth. And so the next time, that was in 2001, I decided that the next, my next run was going to be a buy hold, cash flow model. And that's what I done. And so now we're actually close to a billion dollars now in assets. And it's been all through buying properties well, making sure they cash flow and then returning that cash flow to the investor. So, you know, we had to dig deep and syndicate and go after, you know, money to, you know, raise capital to buy things. But it's a much better model. And I will tell you, we will, we will have a correction. Occupancy rates will go down, there will be concessions and there will be less cash flow. You're going to experience that. And so when you're, when you have well positioned assets that are not too highly leveraged, that are cash flowing massively, then you're going to last through those times just fine, you know?

Yeah, I agree. And if you're not investing in the very, very cyclical markets also, you don't invest in those. You, you're pretty much in the hybrid markets as far as I can tell. That used to be linear. So, you know, these are not like the high flying markets. I mean, you're not, you're not buying stuff in Manhattan, New York, right. Or, you know, Miami and these super expensive high rises or in, you know, in Los Angeles or San Francisco. You're, you're doing more prudent stuff than that, aren't you?

Yeah, we are. So our model has been kind of what we call the workforce. So we want really nice, well maintained properties. And when I say that, I mean they're gated, they have clubhouses, some of them have concierge, some of them have gyms, some have indoor pools. So these are nice properties that we bought that might be 20 years old that needed a few million dollars. And of course we're building too, so we're building brand new. But to your point, we're building in markets like Phoenix and Scottsdale and Plano, Texas or Carrollton or Dallas. Some of these markets that really have great people, great jobs, but really people do have choices in those markets too. Do they want to rent or do they buy a home? There are strategies on where you want to buy rentals in those markets, unlike San Francisco or Chicago or Seattle or New York where you might not, you just don't have that kind of a down payment.

Yeah, no, I couldn't agree more. Those markets are just absolutely crazy. Okay, so talk to us about some best practices in property management. Just, you know, just rattle off a few of them. Of course you're speaking, and I'm super excited to have you speaking at our upcoming Meet the Masters of Income Property event. It's going to be awesome to have you speak. You, you were kind enough to come and speak to my venture alliance mastermind, my small group once last year but this will be the big one, so you'll be speaking to a much bigger audience this time, and we can't wait to have you. You know, you'll have a chance to go into this in a little more depth, maybe in person. But, you know, just a couple of thoughts here on property management, how to do it right.

Yeah, well, I think there's a few things. One, I don't think that a lot of real estate investors engage the property management folks early enough. In other words, I think that they should be part of the process, part of the acquisition. I really do. I think that if you're not going to manage it yourself, you really need to get the individual involved, because what they'll do is they'll help you understand rents, they'll help you understand expenses, they'll help you understand markets, you know, all those kinds of things. You know, property management is very local, local business. There's a few big, big mistakes that are made. And probably the biggest mistake is on, you know, who you let in, actually, you know, obviously, because there's a whole series of mistakes. Tenants.

Tenant screening is what you're addressing, right?

Yeah, yeah, It's. There's all kinds of ways to do that. But, you know, we run criminal credit background checks and sex offender checks on every one of our tenants. So we do about four or five hundred a month, you know, on our properties, our portfolio. So it's so crucial that you have no idea. You know, like I can honestly tell you, Jason, I don't think that we evict very many people. You got to imagine we have 10,000 tenants, right? And when you find somebody that they just want to rent, they're a good family, they've got good jobs. They are so good. You know, they. They just want a nice, quiet, safe place to live. And the experience can be remarkable as compared to the opposite. You know, I have a bunch of stories around that because we've bunch of mistakes, you know, over the years, and that's why we've gotten to where we've gotten as far as our criteria to get in. And so when I see what happens if there's vacancy and somebody has a stress point over money, maybe their mortgage is due and they go onto Craigslist, not that that's necessarily a bad spot, and they end up renting, then you start to see things like drug activity or, you know, who knows what, you know, they just don't pay or, you know, the damage. And, you know, there's just a million stories, right, that can come from putting that Wrong tenant in there. And then it can be very expensive to get them out. Depending on the state, as you know.

Yeah, it varies.

California and California.

That's a disaster. Yeah, that's the worst one ever. Well, New York's probably worse than the California, but they're both pretty terrible.

It's tough to get people out. So, you know, you really want to. That's probably the biggest, single most problem. And then everything stems from there. I mean, all your issues stem from that.

Okay, so let me, let me back up one step from that even. And I think it's sort of in what you're saying and kind of what you said before, Ken, but you didn't actually say it. So I want to make sure the listeners hear it. You know, we offer A, B and C properties that people can buy through our network, and we offer the C stuff, but we really try not to sell it. It's. It's kind of like your discount outline. And it's just those look great on paper, man. But in real life, I mean, you know, they might do great in real life. Okay. But, you know, then the law of large numbers, when you look at the averages, right. I think you're just going to do better with better quality properties. That brings you a certain type of tenant profile. Now, granted, there are exceptions. You know, you can have an A property with a D tenant or, or a D or a C property with an A tenant. You know, it's all individual. But in the law of large numbers and the law of averages, it's going to work out that you're just going to have better experiences with better quality properties and better quality tenants. I say you agree with that.

I do, yeah. You know, and I've managed all those kinds of properties. You know, I've managed personally over 30,000 apartments up and down the Western US and there's several in Phoenix that we've, you know, back when we were doing fee management, I remember two particular properties where, you know, one was. It was so bad, there was a police substation in our rental office. You know, another one, the cops literally would not. They had this. Can't remember exactly what to call it, but they would not go in unless there were two. So in other words, if there was a call to that address.

Yeah. Not a single cop will not go.

It's too dangerous.

Right.

Would not go. I remember walking in one of the units and There was an AK47 leaned up next, you know, on the, on the side of the. Right next to the front door. And so, you know, birds Of a feather flock together, man. There was gang activity, drug activity, and those are management issues. Don't get me wrong. The property next door on both sides was just fine. You know, it's. Who you let in is big. And, you know, it's the craziest story. In the one, there was literally a guy in a wheelchair. This is unbelievable to me, but he was a guy in a wheelchair. He was a drug dealer in a wheelchair.

Right.

So the cops were watching him. Guess how he got in a wheelchair.

How's that?

Got shot.

Yeah.

You know, so here's a guy in a wheelchair dealing drugs, already been shot once. And he's, you know, under surveillance. And so those are things. Those are real things. And. And not everyone in that property is. Is a drug dealer, you know, but people are. That are living in those environments. Move out. Good people, move out.

Yeah, right.

So you just really gotta be careful on who you let in. And you're right about that. It's not always in a C property. I've seen A properties be that way, I've seen B properties be that way and C properties be that way. But most of the time they land in the Cs because they're lower rent. You know, they're lower rent options on the outside of town somewhere.

Yeah, yeah, yeah, that's. That's true. So. So I think that's an important thing. This will be continued on the next episode. Thank you for listening and happy investing. Thank you so much for listening. Please be sure to subscribe so that you don't miss any episodes. Be sure to check out the show's specific website and our general website, hartmanmedia.com for appropriate disclaimers and terms of service. Remember that guest opinions are their own, and if you require specific legal or tax advice or advice in any other specialized area, please consult an appropriate professional. And we also very much appreciate you reviewing the show. Please go to itunes or stitcher radio or whatever platform you're using and write a review for the show. We would very much appreciate that and be sure to make it official and subscribe so you do not miss any episodes. We look forward to seeing you on the next episode.

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