August 19, 2025 • 21 mins
Jason Hull retired at just 46 years old and now spends most of the year traveling with his wife in search of the perfect climate. His lifestyle is funded by his rental income.
But Jason didn’t get there overnight. He started out buying foreclosures, fixing them up, and renting them out.
When COVID hit, everything changed—labor shortages, material shortages, and rising costs made his strategy nearly impossible. Instead of giving up, Jason made a bold move: he sold his entire portfolio and rebuilt it from scratch with new construction rentals.
On this episode, you’ll hear how Jason pulled it off, why tenant screening is even more critical when you’re renting out brand-new homes, and the systems he uses to manage everything while traveling 8–9 months a year.
https://rentalincomepodcast.com/episode535
Thanks To Our Sponsors:
Ridge Lending Group - Get A Free 30-Minute Strategy Session With Caeli Ridge.
MidSouth HomeBuyers – Turnkey Rentals In Memphis & Little Rock. Instant Cash Flow On Day One. (Priced between $100,000 to low $200's)
Rental Accounting Software Made Easy. Free 30 Day Trial
But Jason didn’t get there overnight. He started out buying foreclosures, fixing them up, and renting them out.
When COVID hit, everything changed—labor shortages, material shortages, and rising costs made his strategy nearly impossible. Instead of giving up, Jason made a bold move: he sold his entire portfolio and rebuilt it from scratch with new construction rentals.
On this episode, you’ll hear how Jason pulled it off, why tenant screening is even more critical when you’re renting out brand-new homes, and the systems he uses to manage everything while traveling 8–9 months a year.
https://rentalincomepodcast.com/episode535
Thanks To Our Sponsors:
Ridge Lending Group - Get A Free 30-Minute Strategy Session With Caeli Ridge.
MidSouth HomeBuyers – Turnkey Rentals In Memphis & Little Rock. Instant Cash Flow On Day One. (Priced between $100,000 to low $200's)
Rental Accounting Software Made Easy. Free 30 Day Trial
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:01):
Inspiring interviews with Today is Top Landlords, This is the
Rental Income Podcast and now.
Speaker 2 (00:08):
Damnly Jason, tell me about the life that you live
today because of your rentals.
Speaker 1 (00:14):
So I retired at age forty six, my wife retired
at forty five. We retired at the same time through
through real estate investing mostly, and ever since the pandemic ended,
we've been traveling around the world pretty much eight to
nine months a year, and we have decided that we
(00:38):
are in search of the ideal climate. So we want
to find the place where it's seventy degrees all year
route and I'm actually doing this with you from Manchester, England,
where it today the high was seventy one, so I
almost got there.
Speaker 2 (00:54):
On the podcast today, we're going to walk through Jason's
story and figure out how we did this. Joining us
on the show today is an investor from Texas who
is currently in Manchester, England. Jason Hall will take a
quick break to thank our sponsors. We'll come right back
and we'll talk to Jason. It's a lot of work
to find a really good rental property, and when you
(01:15):
actually find that property, you want to make sure you're
working with a lender that can get that loan closed.
The lender that I recommend is jay Ley Ridge from
Ridge Lending Group. She's a nationwide lender and her specialty
is helping investors finance rental properties. She has a ton
of loan programs and she can find something customized to
you for your situation. If you want to find out
(01:37):
more or you're ready to get started today, just go
to Ridge Lendinggroup dot com. That's our Idge Lendinggroup dot
com n MLS four two zero five six. Are you
thinking about investing in rental properties but maybe you don't
know where to start. My friends at Midsouth Home Buyers
make it simple. For over twenty three years, they've been
(02:00):
selling fully renovated, turnkey rental properties in Memphis and Little Rock.
We're talking new roofs, plumbing, electric, kitchens, bathrooms. Everything is
brand new and done right. And here's the best part.
Every property comes with a well qualified tenant in place
before you close. That means you get cash flow from
(02:21):
day one. Plus Midsouth continues to professionally manage the property
for you after the sale, and they back it up
with two powerful guarantees. You get a one year total
maintenance warranty and a lifetime occupancy guarantee. Personally, I've bought
five properties from them and I couldn't be happier. If
(02:41):
you want to talk to someone that's been through the process,
feel free to reach out to me. I'm happy to
answer any questions, or if you're ready to get started,
just go to midsouthhome Buyers dot com. That's midsouthome Buyers
dot com. Jason, So you travel most of the year,
do you have a home base for when you come
back to the States.
Speaker 1 (03:03):
So we do have a home base. It's a lock
and leave condo in Fort Worth, Texas that we come
back probably two three months a year to see my
wife's family who lives in the Fort Worth area, and
then my family lives in outside of Atlanta, and some
of her family lives in New Mexico. But it's a
really good home base to come back, buy new clothes,
(03:27):
refill prescriptions, meds, get any supplies that we need for
the next time we travel.
Speaker 2 (03:32):
So you're in search of seventy degree weather. What are
some of the places that you've been to?
Speaker 1 (03:38):
So the ones that are probably closest in terms of
climate that we're looking for Mexico City. Mediine has the
perfect climate, but it's a little too hectic for us.
We're currently in Manchester, England, where it's seventy one degrees today. Sydney,
Australia outside of the summer is great. The South Island
(04:02):
of New Zealand is awesome when it's not winter, and
we still want to explore, Like Glasgow is really appealing
to us, So we're going to go check that out
next month.
Speaker 2 (04:12):
Now, the way that you got here, I think is
pretty interesting. So you built a rental portfolio and then
you sold it and bought I guess built a new portfolio.
What was the thinking, Like, why did you do that?
Speaker 1 (04:29):
So we first bought in two thousand and eight, at
the high the financial crisis. We knew that we were
going to move to Texas eventually, so we bought a
home as a foreclosure, rented it out. It wound up
working out well, and so we're like, hey, let's do
this again. So we would just pile up money and
whenever we could afford to buy another house in cash,
(04:51):
we'd reach out to our property manager say, hey, do
you know anyone who's desperate to Zelle. She would give
us something we'd run the numbers, we'd buy another one.
We knew that we wanted to retire early because we
had done the day of Ramsey Financial Peace University, even
though I don't agree with his investments, so we knew
that we had a plan. So using rental property income
(05:14):
was our plan all along. Probably a year before we
retired in twenty nineteen, we really did a deep dive
of the portfolio and realized, hey, you know, we could
sell some of these and buy more and get more
rental income. But we also started looking at like, are
their flips? We were successful in some of those, but
then post COVID doing flipping became a lot harder because
(05:37):
the shortages of labor and materials. So we went to
our third incarnation because we came across a builder who
had really good prices and really good product, and then
numbers worked, and so we decided, you know, let's start
instead dealing with with rehab and repair and supplies and
labor issues, let's buy something new that we oh doesn't
(06:00):
have a lot of repair costs, that we can rent
out and that way we can be a little bit
more hands off.
Speaker 2 (06:06):
Has it worked out that way? Are the new construction
homes just easier, less maintenance.
Speaker 1 (06:12):
So far, so good. We just wired money today for
our third, and once we saw a property that we
have on the market, we'll go for our fourth. But
they've been very easy to rent. The rental profile is
a little different. You have to almost be a little
bit more discerning and who you let rent. Of course
(06:32):
we're not doing that, our property manager is because you've
got a brand new place, so you know, a significant
amount of damage on brand new place is a higher
percentage of pain and cost than a bunch of damage
in an old place. So we're being really picky. But
(06:53):
so far, so good. Fingers crossed. I've probably jinxed us
through this through the podcast.
Speaker 2 (06:58):
Right, So when you were get getting started, you bought
your first property with cash? Is I guess you bought
all the properties with cash for the first portfolio, all of.
Speaker 1 (07:10):
Our properties with cash. When I was in the army,
right before I got the Army, I bought a VA
foreclosure with a VA loan and we put a renter in.
It was great to cover the mortgage, and I went
to grad school. My wife had brand new jobs, so
we were poor as church mice. And of course the
people that were living in that place got a permanent
(07:33):
change of station on like quick notice orders, so our
perfect renters got sent to I think Korea, and we
were left having to pay the mortgage with no income virtually.
So that scarred us, I mean, for better or for worse.
I know, financially, just from a numbers and a quantitative perspective,
(07:54):
leverage is better. But man, the psychology. People really really
underestimate the psychology until they're underwater.
Speaker 2 (08:02):
Right right. So then as far as saving up cash,
so you would did you do any tricks like living
off your wife's income or your income? They go like,
how did you save the money?
Speaker 1 (08:16):
That's exactly what we did. So we basically lived off
of about eighty percent of my wife's income and everything
I made and her leftover, and all of our rental
income beyond having a fund for repairs and paying the insurance,
property taxes, things like that went into a separate bank account.
(08:39):
And when that bank account hit X, we'd reach out
to Misty, our property manager, and say, hey, do you
have anything, and she'd send us stuff and we'd pick
one and she'd go look at and we'd make an
offer and be able to be a cash buyer was
really helpful because we could accept things as is, where
is and closing seven days, and she had done enough
(09:00):
deals with us and she could convey the trust that, yeah,
they're not full of crap. They aren't, you know, they
haven't watched Property Brothers and decided that they're going to
be real estate barons. They can actually do this.
Speaker 2 (09:11):
And how many properties did you get up to before
you sold everything?
Speaker 1 (09:17):
So when we were tired, we had fifteen fifteen properties
and twenty one doors, duplexes, funky three trailers on a
piece of property. And then I just started looking at
the values of the properties and it was like, whoa,
they appreciated a lot more than I thought. We could
sell some of these and potentially buy other properties that
(09:42):
might generate even more rental income. So we started selling,
and then the boom of COVID everyone moving out to
the sticks really helped us. But our idea of like,
we'll buy the properties and repair them and potentially flip
or rent them out got difficult because all the labor
went away and the supply shortages happened, so it wound
(10:04):
up kind of being a wash. And that's when we decided, hey,
let's look at something that's a little less labor intensive
and material intensive.
Speaker 2 (10:13):
Did you do at ten thirty one exchange? Or did
you literally sell everything and then start buying new properties?
Speaker 1 (10:21):
So we didn't sell everything at once. It wasn't like, hey,
here's our portfolio, make us an offer. We just we
put things on the market. Is like renters would would
leave or you know, they would come up for renewal.
It never did a ten thirty one. And I know,
again the financial wonks. I used to be a CFP,
so I know the math behind all this. I know
(10:44):
it's again not the financially right thing to do, but
I just wanted to knock out any tax obligations that
we had and not have to fool with it later
because as you age, one of the first cognitive skills
to go away is men and so I didn't want
to be in my sixties and seventies trying to figure
out all of these accumulated tax liabilities that we had.
(11:08):
I just wanted to make it simple on future old
decrepit me right.
Speaker 2 (11:12):
And you know, being that you bought the properties in
cash and they've appreciated a lot, I mean, you had
a lot of money there to buy new properties, so
it was like you were it didn't sound like you
were really probably stretching to get into the new properties.
Speaker 1 (11:28):
Oh yeah, No, we would never put ourselves at financial risk.
You know, when you retire at forty six, the last
thing in the world you want to do is go
get a jobby job when you're fifty one.
Speaker 2 (11:40):
Right, right, right, totally. So then for the new properties
that you're buying, like, tell me about the properties, like
how big are they? How many bedrooms and baths?
Speaker 1 (11:51):
Yeah, so they're all cookie cutter. They're all five bedroom,
three bath or two and a half bath, eighteen hundred
something square feet on like a quarter acre of land.
It's the same builder. So they do the same thing
with every neighborhood. So we buy like one or two
in each neighborhood, and that way we kind of diversify
(12:13):
our risk in terms of we're not they're not all
in one neighborhood. If a flood comes through the neighborhood,
we're hosed, you know, I mean we would we would
have flood liability insurance. But you get the point, like
if one neighborhood goes into the dumps, you don't want
your whole portfolio to be hosed as a result. So
as they as they start new developments, we try and
(12:35):
catch them at the beginning. They're like, hey, you know
you can reduce your risk. We'll take one of these.
That's that's our plan that we've executed for these three,
and then we'll continue to execute as we rotate through
our old portfolio to get the new properties.
Speaker 2 (12:50):
So you're still adding to your portfolio today. It sounds
like you're maybe just getting started.
Speaker 1 (12:56):
Yeah. So we literally just wired funds on the third one,
and today we've got another property that should be closing
in the next month month and a half that we'll
lather rents, repeat, and then we'll we'll start to do
the same thing that we did in two thousand and
eight as rental income comes in and we can pile
(13:18):
up money. Once we have enough of a pile, we'll
buy another one.
Speaker 2 (13:21):
I guess, like, how did you know that the time
was right to sell?
Speaker 1 (13:25):
So I built a really complicated spreadsheet and ran Solver
on it, and it told me which ones to sell
and which ones not to sell, base on the parameters
I gave it. But one thing that we did before
we really pulled the trigger was go look at every
single property that we had, which we'd never done. We
(13:46):
just bought them all site unseen because we had that
level of relationship, and we had a fallback like, Okay,
if the market drops by this, we can do this.
If the market drops by that, we can do this.
So we knew if worse came to worse, always live
in one of our properties because it was fully paid for,
or you know, we would we would go load full
time in Mexico City or something like that. So we
(14:09):
we had some different ballback options in case the market tanked.
We we knew, you know, if worst comes to worst,
we're not going to have to go dive in a
dumpster for food or have to go get a jobby job.
Speaker 2 (14:21):
All right, So for the new properties, like what are
the what's the price range that you're buying at today?
Speaker 1 (14:28):
So we're buying roughly, we're paying eighty five dollars for
every one dollar of rental income monthly that we get.
So for a thousand in rental income, we're paying roughly
eighty five, give or take a five thousand. So you
can expand contract that as you will, but that's to me,
(14:52):
I think that math works out because hopefully the the
repair expenses will be low, and so we can get
a little bit more cash flow out of them than
we do with a nineteen sixties build. You know, Granny
died in it and we bought it because someone wanted
to get rid of it, right.
Speaker 2 (15:11):
Right, So walk me through the process of selling. So
with selling that many properties, like how did you do it?
Like did you wait for tenants to leave and then
put it on the market.
Speaker 1 (15:24):
Yeah, that's exactly what we did. We would so when
a tenant what either if a tenant told us that
they were leaving, then we would go ahead and put
on the market and give them a little a little
bit off of their last month's rent if they kept
the place nice or if they were renewing. We basically
(15:44):
gave them a number to where we would be indifferent.
If they stayed great, If they don't, we'll sell it.
And so as we kind of cycled through our tenants,
once the talent left, we'd we'd make it ready, repair it, painted, whatever,
and then put on the market. So I don't think
we had more than maybe three properties on the market
(16:07):
at a given time.
Speaker 2 (16:09):
So what would you say is the biggest difference obviously
with new construction. There is less maintenance just because it's
a newer property. But do you find that you attract
a different type of tenant.
Speaker 1 (16:23):
Yeah, and the price range that those are at, it's
much more professional renter, which we really haven't had in
the past. So generally our properties when we bought them
would be anywhere from sixty to one hundred and eight
thousand dollars. Rents would be a thousand to call it,
(16:44):
seventeen hundred and fifty a month, which which is definitely needed,
is very valuable to people, but it brings in kind
of a mixed bag. So you sometimes have to go
through a couple of bad apps before you get a
really appreciative tenant in the property. Whereas you get more
(17:07):
you get just a different type of renter. But sometimes
some of those renters are not the most meticulous people either.
So it's it's always a screen process. It's always going
to be either your job to really really screen for
the psychological characteristics or to have a really good property
manager who does a really good job as screening those times.
Speaker 2 (17:30):
Right now, as far as managing the properties, I mean,
so it seems like it's pretty simple with them being
new and not a lot of maintenance stuff coming up,
so do you manage them yourself or do you still
the manager?
Speaker 1 (17:46):
I couldn't, We couldn't travel the way that we do.
I mean, we designed our lifestyle around minimal involvement in
our investments. So we have had a property manager since
day one. When when we bought our first one in
two thousand and eight, it was in Texas, we were
in Charlottesville, Virginia, and we've had that relationship with her
for seventeen years now, so we will always use her
(18:09):
as our property manager. Again, financially, not the best decision,
but from the lifestyle we were looking to pursue, that
was absolutely the right decision.
Speaker 2 (18:18):
And then as far as buying new places, do you
just buy a new property when you're back in town
or are you comfortable buying a property without actually seeing
it since you've done that so much in the past.
Speaker 1 (18:30):
Yeah, I'm We're in Manchester right now, we haven't been
in the US since April and we're closing on a property.
We wired the money today, we close on tomorrow, so
buying because we're cash buyers, we can buy with docu sign,
which is wire the money. Do the docu sign it
gets recorded we're done. When we sell, we have to
(18:50):
use the power of attorney, so we do have designated
powers of attorney for people to sign for the selling
of property on our behalf. So we did one last month,
we'll do one next month, and we just use our POA.
The title agency sends a mobile notary to them, so
it's pretty low stress on our POA and then we always,
(19:14):
you know, we take them out to dinner or something
when we come back.
Speaker 2 (19:17):
Do you have a certain a number of properties you
want to get to with your new portfolio Infinity? No, No,
we have.
Speaker 1 (19:31):
A pretty good idea of where we want to be
in terms of having enough properties to cover our expenses
without having to dip into our retirement funds. So we're
we're on track to get there probably in the next
(19:52):
eighteen months. Would be my guest to be fully fully
moved over from our our old portfolio to a new
portfolio of new properties.
Speaker 2 (20:04):
It's really amazing what's possible with rental properties. Well, if
anybody wants to reach out to Jason, I've got his
contact information on the website. You can find it at
Rental Incomepodcast dot com Slash episode five thirty five. I'd
like to thank Chailey Ridge from Ridge Lending Group for
sponsoring today's episode. If you're looking to buy a rental property,
(20:27):
whether you're just getting started or you want to add
to your portfolio, reach out to Chailey. She has a
ton of different loan programs and she can find something
that works for you. If you want to track her down,
just go to Ridge Lendinggroup dot com n MLS four
two zero five six. Thank you so much for checking
(20:47):
out the podcast today. Make sure you hit the follow button.
That way you'll be notified when the next episode comes out.
My name is Dan Lane and this has been the
Rental Income Podcast
Inspiring interviews with Today is Top Landlords, This is the
Rental Income Podcast and now.
Speaker 2 (00:08):
Damnly Jason, tell me about the life that you live
today because of your rentals.
Speaker 1 (00:14):
So I retired at age forty six, my wife retired
at forty five. We retired at the same time through
through real estate investing mostly, and ever since the pandemic ended,
we've been traveling around the world pretty much eight to
nine months a year, and we have decided that we
(00:38):
are in search of the ideal climate. So we want
to find the place where it's seventy degrees all year
route and I'm actually doing this with you from Manchester, England,
where it today the high was seventy one, so I
almost got there.
Speaker 2 (00:54):
On the podcast today, we're going to walk through Jason's
story and figure out how we did this. Joining us
on the show today is an investor from Texas who
is currently in Manchester, England. Jason Hall will take a
quick break to thank our sponsors. We'll come right back
and we'll talk to Jason. It's a lot of work
to find a really good rental property, and when you
(01:15):
actually find that property, you want to make sure you're
working with a lender that can get that loan closed.
The lender that I recommend is jay Ley Ridge from
Ridge Lending Group. She's a nationwide lender and her specialty
is helping investors finance rental properties. She has a ton
of loan programs and she can find something customized to
you for your situation. If you want to find out
(01:37):
more or you're ready to get started today, just go
to Ridge Lendinggroup dot com. That's our Idge Lendinggroup dot
com n MLS four two zero five six. Are you
thinking about investing in rental properties but maybe you don't
know where to start. My friends at Midsouth Home Buyers
make it simple. For over twenty three years, they've been
(02:00):
selling fully renovated, turnkey rental properties in Memphis and Little Rock.
We're talking new roofs, plumbing, electric, kitchens, bathrooms. Everything is
brand new and done right. And here's the best part.
Every property comes with a well qualified tenant in place
before you close. That means you get cash flow from
(02:21):
day one. Plus Midsouth continues to professionally manage the property
for you after the sale, and they back it up
with two powerful guarantees. You get a one year total
maintenance warranty and a lifetime occupancy guarantee. Personally, I've bought
five properties from them and I couldn't be happier. If
(02:41):
you want to talk to someone that's been through the process,
feel free to reach out to me. I'm happy to
answer any questions, or if you're ready to get started,
just go to midsouthhome Buyers dot com. That's midsouthome Buyers
dot com. Jason, So you travel most of the year,
do you have a home base for when you come
back to the States.
Speaker 1 (03:03):
So we do have a home base. It's a lock
and leave condo in Fort Worth, Texas that we come
back probably two three months a year to see my
wife's family who lives in the Fort Worth area, and
then my family lives in outside of Atlanta, and some
of her family lives in New Mexico. But it's a
really good home base to come back, buy new clothes,
(03:27):
refill prescriptions, meds, get any supplies that we need for
the next time we travel.
Speaker 2 (03:32):
So you're in search of seventy degree weather. What are
some of the places that you've been to?
Speaker 1 (03:38):
So the ones that are probably closest in terms of
climate that we're looking for Mexico City. Mediine has the
perfect climate, but it's a little too hectic for us.
We're currently in Manchester, England, where it's seventy one degrees today. Sydney,
Australia outside of the summer is great. The South Island
(04:02):
of New Zealand is awesome when it's not winter, and
we still want to explore, Like Glasgow is really appealing
to us, So we're going to go check that out
next month.
Speaker 2 (04:12):
Now, the way that you got here, I think is
pretty interesting. So you built a rental portfolio and then
you sold it and bought I guess built a new portfolio.
What was the thinking, Like, why did you do that?
Speaker 1 (04:29):
So we first bought in two thousand and eight, at
the high the financial crisis. We knew that we were
going to move to Texas eventually, so we bought a
home as a foreclosure, rented it out. It wound up
working out well, and so we're like, hey, let's do
this again. So we would just pile up money and
whenever we could afford to buy another house in cash,
(04:51):
we'd reach out to our property manager say, hey, do
you know anyone who's desperate to Zelle. She would give
us something we'd run the numbers, we'd buy another one.
We knew that we wanted to retire early because we
had done the day of Ramsey Financial Peace University, even
though I don't agree with his investments, so we knew
that we had a plan. So using rental property income
(05:14):
was our plan all along. Probably a year before we
retired in twenty nineteen, we really did a deep dive
of the portfolio and realized, hey, you know, we could
sell some of these and buy more and get more
rental income. But we also started looking at like, are
their flips? We were successful in some of those, but
then post COVID doing flipping became a lot harder because
(05:37):
the shortages of labor and materials. So we went to
our third incarnation because we came across a builder who
had really good prices and really good product, and then
numbers worked, and so we decided, you know, let's start
instead dealing with with rehab and repair and supplies and
labor issues, let's buy something new that we oh doesn't
(06:00):
have a lot of repair costs, that we can rent
out and that way we can be a little bit
more hands off.
Speaker 2 (06:06):
Has it worked out that way? Are the new construction
homes just easier, less maintenance.
Speaker 1 (06:12):
So far, so good. We just wired money today for
our third, and once we saw a property that we
have on the market, we'll go for our fourth. But
they've been very easy to rent. The rental profile is
a little different. You have to almost be a little
bit more discerning and who you let rent. Of course
(06:32):
we're not doing that, our property manager is because you've
got a brand new place, so you know, a significant
amount of damage on brand new place is a higher
percentage of pain and cost than a bunch of damage
in an old place. So we're being really picky. But
(06:53):
so far, so good. Fingers crossed. I've probably jinxed us
through this through the podcast.
Speaker 2 (06:58):
Right, So when you were get getting started, you bought
your first property with cash? Is I guess you bought
all the properties with cash for the first portfolio, all of.
Speaker 1 (07:10):
Our properties with cash. When I was in the army,
right before I got the Army, I bought a VA
foreclosure with a VA loan and we put a renter in.
It was great to cover the mortgage, and I went
to grad school. My wife had brand new jobs, so
we were poor as church mice. And of course the
people that were living in that place got a permanent
(07:33):
change of station on like quick notice orders, so our
perfect renters got sent to I think Korea, and we
were left having to pay the mortgage with no income virtually.
So that scarred us, I mean, for better or for worse.
I know, financially, just from a numbers and a quantitative perspective,
(07:54):
leverage is better. But man, the psychology. People really really
underestimate the psychology until they're underwater.
Speaker 2 (08:02):
Right right. So then as far as saving up cash,
so you would did you do any tricks like living
off your wife's income or your income? They go like,
how did you save the money?
Speaker 1 (08:16):
That's exactly what we did. So we basically lived off
of about eighty percent of my wife's income and everything
I made and her leftover, and all of our rental
income beyond having a fund for repairs and paying the insurance,
property taxes, things like that went into a separate bank account.
(08:39):
And when that bank account hit X, we'd reach out
to Misty, our property manager, and say, hey, do you
have anything, and she'd send us stuff and we'd pick
one and she'd go look at and we'd make an
offer and be able to be a cash buyer was
really helpful because we could accept things as is, where
is and closing seven days, and she had done enough
(09:00):
deals with us and she could convey the trust that, yeah,
they're not full of crap. They aren't, you know, they
haven't watched Property Brothers and decided that they're going to
be real estate barons. They can actually do this.
Speaker 2 (09:11):
And how many properties did you get up to before
you sold everything?
Speaker 1 (09:17):
So when we were tired, we had fifteen fifteen properties
and twenty one doors, duplexes, funky three trailers on a
piece of property. And then I just started looking at
the values of the properties and it was like, whoa,
they appreciated a lot more than I thought. We could
sell some of these and potentially buy other properties that
(09:42):
might generate even more rental income. So we started selling,
and then the boom of COVID everyone moving out to
the sticks really helped us. But our idea of like,
we'll buy the properties and repair them and potentially flip
or rent them out got difficult because all the labor
went away and the supply shortages happened, so it wound
(10:04):
up kind of being a wash. And that's when we decided, hey,
let's look at something that's a little less labor intensive
and material intensive.
Speaker 2 (10:13):
Did you do at ten thirty one exchange? Or did
you literally sell everything and then start buying new properties?
Speaker 1 (10:21):
So we didn't sell everything at once. It wasn't like, hey,
here's our portfolio, make us an offer. We just we
put things on the market. Is like renters would would
leave or you know, they would come up for renewal.
It never did a ten thirty one. And I know,
again the financial wonks. I used to be a CFP,
so I know the math behind all this. I know
(10:44):
it's again not the financially right thing to do, but
I just wanted to knock out any tax obligations that
we had and not have to fool with it later
because as you age, one of the first cognitive skills
to go away is men and so I didn't want
to be in my sixties and seventies trying to figure
out all of these accumulated tax liabilities that we had.
(11:08):
I just wanted to make it simple on future old
decrepit me right.
Speaker 2 (11:12):
And you know, being that you bought the properties in
cash and they've appreciated a lot, I mean, you had
a lot of money there to buy new properties, so
it was like you were it didn't sound like you
were really probably stretching to get into the new properties.
Speaker 1 (11:28):
Oh yeah, No, we would never put ourselves at financial risk.
You know, when you retire at forty six, the last
thing in the world you want to do is go
get a jobby job when you're fifty one.
Speaker 2 (11:40):
Right, right, right, totally. So then for the new properties
that you're buying, like, tell me about the properties, like
how big are they? How many bedrooms and baths?
Speaker 1 (11:51):
Yeah, so they're all cookie cutter. They're all five bedroom,
three bath or two and a half bath, eighteen hundred
something square feet on like a quarter acre of land.
It's the same builder. So they do the same thing
with every neighborhood. So we buy like one or two
in each neighborhood, and that way we kind of diversify
(12:13):
our risk in terms of we're not they're not all
in one neighborhood. If a flood comes through the neighborhood,
we're hosed, you know, I mean we would we would
have flood liability insurance. But you get the point, like
if one neighborhood goes into the dumps, you don't want
your whole portfolio to be hosed as a result. So
as they as they start new developments, we try and
(12:35):
catch them at the beginning. They're like, hey, you know
you can reduce your risk. We'll take one of these.
That's that's our plan that we've executed for these three,
and then we'll continue to execute as we rotate through
our old portfolio to get the new properties.
Speaker 2 (12:50):
So you're still adding to your portfolio today. It sounds
like you're maybe just getting started.
Speaker 1 (12:56):
Yeah. So we literally just wired funds on the third one,
and today we've got another property that should be closing
in the next month month and a half that we'll
lather rents, repeat, and then we'll we'll start to do
the same thing that we did in two thousand and
eight as rental income comes in and we can pile
(13:18):
up money. Once we have enough of a pile, we'll
buy another one.
Speaker 2 (13:21):
I guess, like, how did you know that the time
was right to sell?
Speaker 1 (13:25):
So I built a really complicated spreadsheet and ran Solver
on it, and it told me which ones to sell
and which ones not to sell, base on the parameters
I gave it. But one thing that we did before
we really pulled the trigger was go look at every
single property that we had, which we'd never done. We
(13:46):
just bought them all site unseen because we had that
level of relationship, and we had a fallback like, Okay,
if the market drops by this, we can do this.
If the market drops by that, we can do this.
So we knew if worse came to worse, always live
in one of our properties because it was fully paid for,
or you know, we would we would go load full
time in Mexico City or something like that. So we
(14:09):
we had some different ballback options in case the market tanked.
We we knew, you know, if worst comes to worst,
we're not going to have to go dive in a
dumpster for food or have to go get a jobby job.
Speaker 2 (14:21):
All right, So for the new properties, like what are
the what's the price range that you're buying at today?
Speaker 1 (14:28):
So we're buying roughly, we're paying eighty five dollars for
every one dollar of rental income monthly that we get.
So for a thousand in rental income, we're paying roughly
eighty five, give or take a five thousand. So you
can expand contract that as you will, but that's to me,
(14:52):
I think that math works out because hopefully the the
repair expenses will be low, and so we can get
a little bit more cash flow out of them than
we do with a nineteen sixties build. You know, Granny
died in it and we bought it because someone wanted
to get rid of it, right.
Speaker 2 (15:11):
Right, So walk me through the process of selling. So
with selling that many properties, like how did you do it?
Like did you wait for tenants to leave and then
put it on the market.
Speaker 1 (15:24):
Yeah, that's exactly what we did. We would so when
a tenant what either if a tenant told us that
they were leaving, then we would go ahead and put
on the market and give them a little a little
bit off of their last month's rent if they kept
the place nice or if they were renewing. We basically
(15:44):
gave them a number to where we would be indifferent.
If they stayed great, If they don't, we'll sell it.
And so as we kind of cycled through our tenants,
once the talent left, we'd we'd make it ready, repair it, painted, whatever,
and then put on the market. So I don't think
we had more than maybe three properties on the market
(16:07):
at a given time.
Speaker 2 (16:09):
So what would you say is the biggest difference obviously
with new construction. There is less maintenance just because it's
a newer property. But do you find that you attract
a different type of tenant.
Speaker 1 (16:23):
Yeah, and the price range that those are at, it's
much more professional renter, which we really haven't had in
the past. So generally our properties when we bought them
would be anywhere from sixty to one hundred and eight
thousand dollars. Rents would be a thousand to call it,
(16:44):
seventeen hundred and fifty a month, which which is definitely needed,
is very valuable to people, but it brings in kind
of a mixed bag. So you sometimes have to go
through a couple of bad apps before you get a
really appreciative tenant in the property. Whereas you get more
(17:07):
you get just a different type of renter. But sometimes
some of those renters are not the most meticulous people either.
So it's it's always a screen process. It's always going
to be either your job to really really screen for
the psychological characteristics or to have a really good property
manager who does a really good job as screening those times.
Speaker 2 (17:30):
Right now, as far as managing the properties, I mean,
so it seems like it's pretty simple with them being
new and not a lot of maintenance stuff coming up,
so do you manage them yourself or do you still
the manager?
Speaker 1 (17:46):
I couldn't, We couldn't travel the way that we do.
I mean, we designed our lifestyle around minimal involvement in
our investments. So we have had a property manager since
day one. When when we bought our first one in
two thousand and eight, it was in Texas, we were
in Charlottesville, Virginia, and we've had that relationship with her
for seventeen years now, so we will always use her
(18:09):
as our property manager. Again, financially, not the best decision,
but from the lifestyle we were looking to pursue, that
was absolutely the right decision.
Speaker 2 (18:18):
And then as far as buying new places, do you
just buy a new property when you're back in town
or are you comfortable buying a property without actually seeing
it since you've done that so much in the past.
Speaker 1 (18:30):
Yeah, I'm We're in Manchester right now, we haven't been
in the US since April and we're closing on a property.
We wired the money today, we close on tomorrow, so
buying because we're cash buyers, we can buy with docu sign,
which is wire the money. Do the docu sign it
gets recorded we're done. When we sell, we have to
(18:50):
use the power of attorney, so we do have designated
powers of attorney for people to sign for the selling
of property on our behalf. So we did one last month,
we'll do one next month, and we just use our POA.
The title agency sends a mobile notary to them, so
it's pretty low stress on our POA and then we always,
(19:14):
you know, we take them out to dinner or something
when we come back.
Speaker 2 (19:17):
Do you have a certain a number of properties you
want to get to with your new portfolio Infinity? No, No,
we have.
Speaker 1 (19:31):
A pretty good idea of where we want to be
in terms of having enough properties to cover our expenses
without having to dip into our retirement funds. So we're
we're on track to get there probably in the next
(19:52):
eighteen months. Would be my guest to be fully fully
moved over from our our old portfolio to a new
portfolio of new properties.
Speaker 2 (20:04):
It's really amazing what's possible with rental properties. Well, if
anybody wants to reach out to Jason, I've got his
contact information on the website. You can find it at
Rental Incomepodcast dot com Slash episode five thirty five. I'd
like to thank Chailey Ridge from Ridge Lending Group for
sponsoring today's episode. If you're looking to buy a rental property,
(20:27):
whether you're just getting started or you want to add
to your portfolio, reach out to Chailey. She has a
ton of different loan programs and she can find something
that works for you. If you want to track her down,
just go to Ridge Lendinggroup dot com n MLS four
two zero five six. Thank you so much for checking
(20:47):
out the podcast today. Make sure you hit the follow button.
That way you'll be notified when the next episode comes out.
My name is Dan Lane and this has been the
Rental Income Podcast
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