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Show Summary
In this engaging conversation, Mike Hambright and Gino discuss the importance of financial legacy and the concept of ‘happy money.’ They explore how to create a fulfilling relationship with money, the mindset of an investor, and the significance of understanding one’s money persona. The discussion also touches on the current market trends and the importance of adapting investment strategies over time. Gino shares insights from his new book, emphasizing the connection between money, family, and legacy.
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Investor Fuel Show Transcript:
Mike Hambright (00:00.889)
Hey everybody, welcome back to the show. Really excited to have my buddy Gino on today. I had him on the podcast about a year ago or so ago and always enjoy our conversations and we have a lot in common. We’re trying to get off the grid here. He bought a farm, I bought a ranch and we’re talking about how that’s our happy place, right? So anyway, we’re gonna be talking about money and financial legacy and stuff like that today. And both of us are probably at an age where we think more about that. So depending on your age.
Gino (00:13.742)
you
Mike Hambright (00:29.991)
Maybe you’re there, maybe you’re not there yet, but hope you enjoy the ride. So Gino, what’s up, buddy?
Gino (00:34.358)
Mike, I’m doing good. And as I was listening to this, Mike’s saying that we’re a little bit older than maybe the average listener would be. But that doesn’t mean that you shouldn’t still abide and really discuss Stephen Covey’s principle, think with the end in mind. I don’t know if I ever thought that by a farm, but I thought with the end in mind that I wanted some kind of financial security for my family. I wanted a lot of kids. So how did that happen? So if you’re listening to this right now, you may be nowhere near retirement.
Mike Hambright (00:39.343)
Hahaha.
Mike Hambright (00:47.854)
Yeah, for sure.
Gino (01:00.59)
But what does that look like 20 or 30 years from now? And then let’s reverse engineer that. And what do you need to do today to be able to get to the point where Mike is right now driving on a tractor, having fun? I mean, you got to plan today to be Mike 20 years from now, right Mike?
Mike Hambright (01:09.961)
Hahaha.
Yeah, I’ll tell you, you know, I’ve done over the past 13 years, I’ve done over 1500 video podcasts and interviewed a lot of people, talked to a lot of people. I’m a networking, you know, I’m a networking, I love the network. I love to meet people like you, Gino. And the single biggest regret, if I ever ask people like, what’s your biggest regret? It’s always, they wish they’d started earlier in real estate typically. But obviously same thing for investing. Like time is time, you know, time goes by fast and time is the biggest resource you have if you have it, right? And so.
when you’re starting early, even if you are a little bit older and you could instill these things into your kids, because I mean, I can tell you, my kid, my son is 17. He doesn’t listen to my podcast, so he’s not gonna hear this, but he doesn’t know. He has self-directed IRA accounts. He’s got a whole bunch of accounts he doesn’t even know about, right? And so I didn’t have those things until I was like 40. anyway, here we are. So we’re gonna talk about, you know.
Gino (02:04.279)
Hahaha!
Mike, let’s-
Mike Hambright (02:10.465)
Money, like what is, you kept using this phrase happy money. I know you got a new book out too, happy money. And I know I want you to extrapolate on it, but I know there’s people that have a bunch of money and they’re mad at the world and they’re not happy and they are grinding themselves to death. And there’s people that have money and they can find their happy spot. So what does happy money mean to you?
Gino (02:29.294)
Before I answer that question, I want to challenge everybody. Are you working hard for your money, or is your money working hard for you? When you answer that question honestly to yourself, like I did back in 08, man, I was grinding for money, but my money is sitting there and not working hard for me. That’s when I realized, and the reason why this thought came to my mind was you’re talking about, you’ve got a compound. You’ve got to start earlier. And for you to start earlier, you need to get your money to start working for you.
It’s one thing that you need to work hard. There’s no four-hour work weeks when you start out. That’s a bunch of nonsense. But you need to work hard, then you need to work smart, right? We need to put both of those together and you need to make your money work. Now, when I wrote the book Happy Money, Happy Family, Happy Legacy, I had interviewed Ken Honda. He is the original happy money guru guy. And he says to me in his Japanese accent, Gino, you need to write happy money, happy properties, happy family. I’m like, dude, not another real estate book, but I love this concept of happy money.
because for many years it resonated with me that money doesn’t make you happy. That’s not the title of the book. That has nothing to do with it. What makes you, me, and I think everyone listening to this podcast happy is autonomy. To be able to say to myself, I’m going to do 250 podcasts this month, this year. I’m going to buy a hundred acre farm because I can. I have the ability to do that. I have the optionality to do that. And that’s what makes us truly happy. Now money is just the result.
Now for me, happy money is getting on these podcasts, being able to say to myself, hey, I can start a company with my family to help other families become more connected. Unhappy money, conversely, is being stuck in a job that you hate. You need to go to work, you need to buy this duplex, but you really freaking hate it. And it’s draining, it’s fearful, it’s negative. And how many of you out there listening have been there or maybe be there right now? We’ve all been there.
I had a restaurant for over 20 years. The first 10 were great. The last 10 sucked. I was embroiled in happy money. I was really fearful. I was really scarce. And until I started getting into multifamily, until I started working on personal development, until I started getting on these types of shows and podcasts, that’s when I started finding my happy money and the paradigm. One last example. I gave the book to my landscaper last week and he was sort of baffled. He’s like, you write books? I’m like, yeah, it’s not that big of a deal. There’s so many people writing books.
Gino (04:56.482)
And he’s like, what’s his happy money? So he gets 15 pages into it. He’s like, I only read 15 pages, and it took me an hour. And it’s really thought provoking because he’s like, Gino, now I understand my electric bill is happy money. And what he meant by that was, hey, you could look at a bill and be really pissed off about it. But how amazing is it that we’ve got electricity? It’s just the way you’re looking at things. And I think if you can take a bigger or a different approach to the way you’re looking at things, life completely changes.
Mike Hambright (05:25.635)
Yeah, that’s awesome. Yeah, I’m reminded of, there’s two things I thought of when you were talking there. As a good friend of mine once said, this is somebody you know too.
once said, real estate isn’t the thing, it’s the thing that gets me the thing. And I think, you know, I think for a long time, like I kind of fell out of love with like another property, we got another one, you know, like I like what it does for me, though, it’s allowed my, you know, it’s changed my family tree, honestly. So I like all the things that it does for me. But I’m like falling out of love of like flipping another after you’ve flipped hundreds of them, you’re just like, whatever, another one, you know, I mean, I still like the transformation, but like I was really into the real estate, like in the early years. And then now it’s just like,
Gino (05:37.535)
Yes, I like that.
Gino (05:43.534)
Yes.
Mike Hambright (06:04.145)
It’s the thing that gets me the thing, you know? And then another one was just changing with, sometimes you find yourself saying, have to do something. I have to do this. I have to do that. Is to start to say, I get to do that. Like I get it. And sometimes, I I find myself all the time also using this phrase. I’ll be talking to someone like, well, this is a first world problem, you know? Cause it’s like, I’m about to tell you something that sounds bad, but for the average person, it’s not that bad, but.
Gino (06:06.638)
That’s well said.
Gino (06:15.608)
Mm-hmm.
Gino (06:27.0)
Yes.
Yes. I agree, half the world doesn’t have running water. It doesn’t have clean water, right? And we take so many things for granted. I’ve got a pool out there. I used to complain that the guy would come and clean the pool for 150 bucks a month. That’s a home run. I don’t have to sit there for hours cleaning the pool and it only cost me 150 bucks. That should not be happy money. That should be ecstatic money. And now once you take a look at that, you start appreciating things. And that one thing, that one word in life that’s called gratitude, if you’re more grateful,
Mike Hambright (06:34.223)
Yeah.
Mike Hambright (06:44.911)
All right.
Gino (06:57.026)
for the things you have in life, things start changing for you, you become more grateful, you become more appreciative of life.
Mike Hambright (07:02.765)
Yeah, that’s awesome. That’s awesome. you know, one thing that, you know, a lot of people, we throw this word around lot, investor, like an investor, right? And what is an investor to you? What does that mean?
Gino (07:17.326)
It’s a dangerous term because people confuse what an investor in creating wealth really are. I think an investor is someone who masters a skill, but before one becomes an investor, they have to master themselves. You’ve seen people who go out and make a ton of money, they’re investors, and then all of a sudden a year later, they lose it only to make it again and then to lose it again. I think to me, an investor is someone who understands their
Mike Hambright (07:41.337)
Hmm.
Gino (07:45.326)
the vehicle that they’re investing in, they’re trying to limit their downside risk. They’re seeing that there’s value in what they’re investing in and they’re trying to extrapolate and pull value from that investment. For me, I’m in Volti family. We are looking for the value add, material value add, whatever it is. We’re looking for an asset that is underpriced where we see that there’s value that we can add to what we call the net operating income. If we can increase the net operating income of a property, we can increase the value.
and we’re looking for a future stream of revenue. That is what to me, an investor is in multifamily. But ultimately to me, before you even start investing, if you’re listening to this, please, you need to build a foundation. You need to understand yourself. You need to understand what you like to invest in. Cause Mike and Gino, we love real estate. Mike got into the single family, more transactional, a lot quicker. I got into multifamily. It’s a lot slower. It’s a lot more boring.
It’s more of a business systems model because I have to deal with a lot of property management. So you have to pick a vehicle that really suits your needs. think Morgan Housel said it best in the psychology of money to become a really good investor. You need to a number one, learn how to save money because you’ve to be able to save capital to be able to invest capital. And number two, you have to know what you like. You may like Bitcoin and trading crypto. To me, it’s not an investment because I think an investment
Mike Hambright (09:04.004)
Mm.
Gino (09:12.11)
you have to have some type of yield. I don’t wanna just invest for cap appreciation, that’s me. I want some type of dividend alongside that yield and that’s what I think is multifamily is just phenomenal for and I want tax benefits, I want the whole kit and caboodle. But if you’re listening to this, understand what your money persona is. If you don’t know that and you just start investing money, you may be making a big mistake and a big disservice to yourself.
Mike Hambright (09:38.073)
Yeah. And I think that can change over time too, right? I I’ve flipped hundreds of houses, primarily a single family guy moved in heavy into multi-family five or six years ago. That’s been pretty slow over the last couple of years. So we found that we’re investing in the stock market of all places over the past couple of years, because you know, the truth is, is my wife and I sat down and we talked a lot about what is, we’re 50, like what does our future look like here? And we’re like, we just generally want to be more passive and our multi-family is
pretty passive. My single family rental portfolio, even though we don’t manage them, not passive, like I’m still getting pulled in all the time on stuff, know, houses burning down, evicting tenants. We’ve got notes, so we’re foreclosing on people sometimes. There’s still a lot of stuff that it’s not really that passive. And we’re like, you know what? The stock market really is passive. Now, the returns are not as high, but there’s some truth to having and there’s some truth. You know, we’ve been so all in on real estate for so long now.
Gino (10:27.598)
Mm-hmm.
Mike Hambright (10:34.093)
that as we kind of look out a little ways, it’s like, you know what, we need to be open to doing some other things that truly are more passive, because that’s where we want to get to ultimately. So that changes over time is my point.
Gino (10:42.926)
Mike, but you made a great point. First of all, you’re having the conversation with your wife. Most people don’t have that hard conversation with their significant other, with their spouse or with their kids. They don’t understand the relationship. And what you said was great. Early on, you’re all in on real estate because you need to create equity. You need to create wealth. You don’t do that. It’s a lot harder to do that in the stock market with six or seven or 10%. You can do that a lot easier or a lot.
Mike Hambright (11:07.748)
Yeah, yeah.
Gino (11:09.08)
quicker with real estate. So what you’re doing is you’re putting money into a vehicle, you’re exiting that vehicle, you’re taking those funds and you’re putting it into something that’s a little less, that’s a lot less, it’s a lot more passive. And I think you have the optionality to do that because you started sooner. If you’re sitting here, you’re in your late 40s and you’re saying to yourself, I need to create money, I need to get some type of retirement going. Real estate’s a great vehicle. It’s not passive unless you’ve got capital to invest with other people, then it can be more passive.
But understanding what your goals are is another thing as an investor. What are you trying to accomplish? If you’re in your 30s and saying, hey, I’ve got 30 years to retire. I just want to start putting some money into some passive real estate deals. Great. But if you’re 30 years old like me and you’re like, man, my job sucks. I hate what I’m doing. I need to quit this thing in the next five years. There’s a different strategy involved in that than just trying to go out and do it passive.
Mike Hambright (12:01.167)
Yeah, for sure, for sure. It depends on where you’re at for sure. And then what’s also interesting is with real estate, you get to a point where you might have cash, but you don’t need to use your own cash for deals. sometimes, I mean, the interest rates are different now, but when interest rates are lower and if you’re raising money for deals or even on single family stuff, like I’ve had money for deals, but I just had great private lenders and stuff like that. on hundreds and hundreds of deals, we…
very rarely used our own money, right? So it’s kind of crazy. We’re like borrowing money and we’re like, well, what are we going to do with, and this sounds like a first, again, a first world problem. It’s like, I’ve got cash. Where am I going to put it? Right. And we just plowed it into rental, single family, and then eventually we plowed it into multi-family. But you get to a point to where there’s the operations pay for themselves and you have, you know, again, first world problems here, excess cash, and you have to find someplace to put it. And you know, you got to find that place. It could be buying other businesses. It could be a lot of things, but.
It could be buying a ranch or a farm.
Gino (13:01.73)
Mike, you’ve got a great relationship with money because most people, when they get that kind of money, they don’t know what to do with it. A lot of people like to spend. You sound like as if you’re a saver. Your money persona is Mike the saver. I’m going to get the money. I’m going to be able to save it. But my first idea is, where am I going to deploy it? I’m going to be also Mike the investor because we can have multiple personas. And if you understand that, you’re saving the money. And then from there, building the foundation, what do I do next? I need to deploy the money. And most people deploy it into buying luxuries, like,
Lambos. And like the farm, you can afford to buy the farm at this point in your life because you’ve got what we call baby money soldiers. You’ve earned a ton of money. Every dollar that’s come into your life, you’ve earned that. And there’s certain responsibilities or duties for your baby money soldiers. You’re trying to multiply them by taking over more properties and creating more of them, right? The problem is people early on kill their baby money soldiers by using them on stupid things like luxuries, vacations, jewelry, cars.
Once they’re dead, they’re off the table. But what you’ve done and what I’ve done successfully is, you know what, let’s defer that. Let’s take them and buy another deal. And the money from that deal, let’s not take that money out. We’re going to reinvest it into another deal and then another deal. And then the compounding goes. And obviously we put some in reserve. We have some as protection, but we keep going on. And then from there, we are actually living from our production. See what Americans mostly do is they consume.
Mike Hambright (14:13.08)
Yep.
Gino (14:28.654)
through their consumption. They don’t consume through their production. What you and I have done, what most wealthy people do, is they produce something and from that production, they’ll be able to go out and spend money. And that’s how you create wealth and that’s how you continue to perpetuate wealth. Whereas most people, what they do is they consume and they go, I’ve got some money, let me pay off my bills. Instead of saying, let me create something, let me build something and off of this production, let me pull that money out and be able to go to use it on buying something. That’s the difference what I’ve seen.
Mike Hambright (14:38.543)
Yeah.
Gino (14:56.718)
over the last 10 or 15 years between someone who can become financially free and understands what money is and how to use money versus someone who’s got like the sort of the poor mentality or the middle class mentality where they’re there and they’re there. Let me save or let me just, you know what? Got money here, let me go and blow it. Instead of let me try to invest that.
Mike Hambright (15:15.533)
Yeah. Can that persona change? Like, let’s talk to the people out there because we know there’s people that are listening to this and we wish you well for sure. But those that like tend to like make really good money, but they never are really investing in there. They’re like, they would probably say, man, I’m investing in my happiness, which is fine. You should. But like, how do you do that in a way to where that money has a much longer runway?
but for those that are used to making good money and just kind of blowing it on toys or whatever, like how can they change?
Gino (15:46.904)
Well, this is the first podcast that I’m pitching the book. So I’m going to pitch the book because it’s in it’s in happy money, happy family, happy legacy. And the first way to change anything is to become aware of it, to become aware of what you’re doing. Most people are on autopilot. Most people don’t know the relationship with money. Most people don’t know their persona. You know, some people go out and blow money. Well, why is that? We have four happy chemicals. We have dopamine, serotonin, endorphins and oxytocin.
Mike Hambright (15:50.275)
Yeah, let’s do that book.
Gino (16:16.162)
Dopamine is the drug that in your brain that says, I want to feel good. To some people, eating a piece of cheesecake makes them feel good. So they go and have a piece of cheesecake, dopamine hit. Some people like to gamble. Some people like to go spend money and just buy frivolous things. It feels great in the moment, but when that moment’s over, it’s like, why did I do that? And the cycle continues. And the cycle continues. If you’re not aware of that, most people aren’t aware of that, then they will truly never understand how to master.
that emotion or that effect. And I think the second part, honestly, is to have a real and honest conversation with yourself, to go back to yourself when you were nine and 10 and 11 years old and hear what people were talking about in reference to money when you were younger. What did mom and dad say? Is everything too expensive? We can’t afford it. Does money grow on trees? Are you saving for a rainy day?
Or are they not even talking? Are they avoiding the conversation altogether? Is there always stress around it? And that will carry on into your adulthood. And then all of a sudden, you have that persona carry on. So you can change your persona because I was more of a saver early on. I was younger. My parents were both immigrants. We had a restaurant, but we were very frugal. And I was always taught to save, save, save. And then when I understood, save to buy an asset.
and that asset will pay for the event. You’re saving to buy a multifamily that will cash low so I can put my kids through college. Instead of just purely saving, I understood the saver persona and the investor persona. And then once I understood that and I understood what my relationship was and I can have an honest conversation with myself and not feel bad for myself, sometimes that saver mentality made me feel scarce. I love to see that money in the bank. I love to see those zeros growing.
Mike Hambright (17:44.718)
Mm-hmm.
Gino (18:10.988)
I don’t want to touch that. can’t go out and buy a farm because that would kill me. But that was my relationship with money. So once I understood that, I started going through it and I started doing a lot of work. It comes down to really personal development and mindset and working on it and wanting to work on it. When I had the pain of going through that restaurant and those years of unhappy money, I had to say, do I, not knowing the word, but how do I get into something that I want to do, that I enjoy doing, and how do I create that wealth?
Mike Hambright (18:24.303)
Yeah.
Gino (18:37.996)
And if I don’t go back to my early eight, early years, when you really start creating your values at that age and my values were safe, safe, safe, don’t spend, be scarce, there’s no abundance. If I continue to carry that on, I wouldn’t be enjoying what I’m doing right now.
Mike Hambright (18:53.377)
Yeah, yeah. You know what, think another lesson that kind of runs a parallel to this is understanding the opportunity cost of your time, right? Because we have very limited time and I grew up in a very hard working blue collar family. It’s kind of where I got my work ethic to work hard, but my family was more of the type to never outsource anything. We’re going to mow our own lawn, change our own oil, cut our own hair, like all that stuff. And you get to a point to where
Gino (19:00.45)
Mm-hmm.
Gino (19:08.365)
Yes.
Gino (19:12.216)
Yes, Yes, yes.
Mike Hambright (19:16.066)
When you realize, when you start making some decent money, you’re like, hey, my hourly rate is pretty high. Like, why am I doing $10 an hour work here and there? Because, you know, it’s like one thing to roll up your sleeves and just work hard. It’s another thing to say, that’s not a good use of my time. I should be spending it on stuff where can make more money or make a bigger impact.
Gino (19:24.94)
Mike, how hard was that though?
Gino (19:31.918)
How hard was that though? That must have been hard for you. You must have been around the right people to make you have that realization because if you’re just a regular blue collar person and all your friends do that and you’re around that group, it’s just normal. That’s just the way life is. But it must have been challenging for you to say, hey, I can get a bookkeeper for 20 bucks an hour instead of me banging away on QuickBooks. Or I can get somebody to edit this podcast instead of me doing it myself because I can save the money or a flip. You know what? I can paint the wall. I don’t have to pay somebody 600 bucks. I can do it myself.
Mike Hambright (19:44.388)
Right.
Mike Hambright (19:55.311)
Yeah.
Gino (20:01.026)
And I think that’s the hard part because you have such a relationship with how you’ve been taught versus there may be a better way to do it. And I don’t think most people look for the better way to do it because their peer group is telling them, dude, come on. Classic example is firefighters. I love firefighters. They have such an incredibly difficult job, but a lot of them have second jobs and a lot of them will do part-time stuff. But when you talk to them, it’s like, they’re always like, that’s too much money. I’ll do it myself. I’ll do it myself.
Mike Hambright (20:01.13)
Yeah.
Gino (20:29.848)
Well, you’re working a full-time difficult job as it is, and then you’re working part-time and other times. When are you ever home to enjoy the family? Because you’re out there trying to save a few hundred bucks a week, and I get it, there’s nothing wrong, but that mindset is pervasive, I think, in a lot of society now. It’s like, look at your time and see what, not your peer group, but what’s the peer group that you want to emulate. If you want to get into that financially free, wealthy mindset.
they’re not cutting their grass unless they love it, unless it brings them happy money. If you sit on the mower and you’re freaking love it and it’s not worried about the time, you know, you’re out there, different story. But if you’re trying to save 20 bucks an hour by cutting the grass, it’s not where you should be putting your time and effort in.
Mike Hambright (21:08.174)
Yeah, yeah. And think especially, you for me, it was after I became an entrepreneur, which was really 2008, right? It was like when you’re working for somebody else, you’re not thinking about, well, first off, when you work for yourself, you know, you’re not working 40 hours a week, you’re probably working way more, right? But also you’re like, then you start to balance time. Like this isn’t a good use of my time. And I think the other thing that helped me is I’m pretty much just not good at many things. Like handy, like my parents were, you know, my dad, my brothers, everybody’s like really handy, good working with their hands.
Gino (21:23.158)
Yes.
Gino (21:28.333)
Yes.
Gino (21:32.772)
Yeah.
Gino (21:37.667)
Yes.
Mike Hambright (21:37.827)
I was like, even hanging a picture, like I screwed that up somehow. I’m like, if you’re just not good at anything, you kind of realize I need to find somebody else to do this anyway. And that kind of works out, I guess.
Gino (21:44.27)
Yeah, I got a funny story. A couple weeks ago, my wife is like, can you show me how to do this online, this computer thing? I’m like, I don’t know how to do it. She goes, what do mean you don’t know how to do it? I said, Julia, you told me five years ago to start delegating things and not worrying about it, not learning how to do it. And she goes back to me, well, you should know how to do I’m taking your advice. You told me not to do it. So I’m like, I’m listening to you right now. I don’t know how to do it. And I think if you can really, part of the happy money thing is if you can really find what you’re really looking
love to do and show up and do that, I think the money and the results will show up even more dramatically in your life.
Mike Hambright (22:21.391)
Well, what do you think is going on with the current market? I know none of have a crystal ball. We don’t know what’s going to happen here. We don’t know what’s going to happen with interest rates or whatever. think with the new administration in place that America just got a lot more business friendly, I think. We’re going to find out with time. But where do you foresee things going here over the next year or two even?
Gino (22:41.43)
Mike, if we go back the last couple of years, I want to ask you a question honestly. Has it felt like there’s been stagflation? Like nothing really going on. Things are really slow. No one’s really talking about that. Everyone’s talking about all these numbers. They come out high, then they revise them downward. I don’t believe any of the data to be completely honest with you. I think we’ve been in a recession for the last two years. I think a regular recession, not numbers or GDP driven because there’s so much money pumped into the system. But if you look at housing, even in Florida over the last 12 months, it’s down.
Multifamily hit a high in 2022. It’s down 22 % since then. Cap rates have started decompressing. I think they’re going to continue to decompress. We’re probably 20 % off where prices should be, conservatively, in a good market. So I think prices have to continue to drop to actually make these debt coverage ratios work. Bridge debt is not the answer. That’s what people were doing two and three years ago. We always practiced and preached long-term fixed rate financing.
But as you know, it was really hard to get a deal in 2022 and early 2023 doing that. But no deal is better than a bad deal. That said, going forward, I still think there’s going to be inflation unless they cure this spending. And if you’ve got high inflation, the Fed’s not going to cut rates because the Fed’s biggest job is to take care of inflation is really an increase in the supply of money. The result of inflation really is prices going higher. And we’ve seen that.
Mike Hambright (23:43.577)
Yeah, yeah, for sure.
Mike Hambright (24:03.055)
.
Gino (24:06.774)
And anyone who thought inflation was transitory back in 2021 should not have a job. They should have all lost their jobs because that was the biggest scam ever. We should have dropped rates a lot, pushed rates up a lot quicker, you know, sooner. But I think if you’re going forward in the next 12 months, if you’re thinking about getting into real estate, I’m going to be completely honest with you. Now is the time because you need to make relationships with brokers. You need to start talking to investors because the deals will come. We keep talking about this debt, this debt crisis, this debt, you know,
Reset going on in November. There’s me a lot of debt coming due in November They keep keep kicking the can down the road and I don’t think by the end of this year rates are gonna come down enough So there’s gonna be a lot of deals that there’s gonna be a lot of LP equity That’s gonna be written down. I think banks are gonna be taking back some of these deals I think there’s gonna be some real I don’t want to call them short sales But if you bought a deal for 10 million and you’ve got 2 million of LP equity in there
Really, you can sell it for eight, lose all your investors capital and get out of the deal. I think a lot of that’s going to happen. I really do. I see it because there’s a lot of markets right now that there isn’t over supply. You’ve got a lot of multifamilies that are coming online. But once they come online, there’s not a lot of supply of building going on after the supply is burned out. So there’s this weird area where if you can hold on, but at the same time, I think the one
great area in multifamily is if you can get into these newer assets where there’s developers who have to sell these assets. They’re finishing them up. They haven’t leased them out yet because there’s a lot of concessions in the market. If you can go in and buy these newer assets right now, we bought two of them last year. We’re on the verge of getting another one this year because developers, built them. They’ve, they’re in for a good basis because they probably got the land at a good price. And now they’re on another project because that’s what they do. They build, build, build, build until they go bankrupt.
And now they’re on another project, they’ve got a liquidity problem, so they’re selling this asset that they’re trying to lease up. That’s where I think the opportunity is in the next 12 to 18 months.
Mike Hambright (26:04.239)
Yeah, that’s great. And I have another friend or one of my partners that does some of that in the multifamily too. And, you know, one of the things that he said is a lot of the builders, they’re not trying to maximize rent either. They’re just trying to get butts in seats, if you will. They’re trying to get those things leased up so they can say they have a 90 plus percent occupancy rate, even if it’s not the best rate. as a savvy investor, if you’re a good operator, you can come in and get the rents up too, right?
Gino (26:14.274)
No. Yes.
Gino (26:21.955)
Yes.
Gino (26:26.838)
Mm-hmm, you’re looking at these like brand new builds at let’s say 200,000 a unit at 250,000 unit It would take Jake and myself three years plus to build something like that So we have three years worth of risk and then you see like you’re saying these these developers they should probably Go out and partner up with the property management company because they’re leaving fees on the table. They’re leaving lower rents They’re leaving, you know obviously this this
this whole way to manage these assets, their expenses are a lot higher than what they should be. So you’ve got valuation through operation. You know, the whole mantra was valuation through renovation these last five or six years. Now we’re looking at the operational side of the business and like these developers, they’ve left a lot of that money on the table for us.
Mike Hambright (27:09.699)
Hey, Gino, show us that book one more time. hot off the presses here. Tell us what’s it called one more time. Read it out.
Gino (27:15.842)
Happy money, happy family, happy legacy. Because for me, trying to create the happy money will lead to a happier family where you can sit around and discuss money. Don’t avoid the situation of money. And then ultimately, how to create a happy legacy through your happy money, through the happy family, and not just focus on the financial legacy, but let’s focus on what you want to leave as far as your values to the next generation.
Mike Hambright (27:40.967)
How do people get that book? Do get it on Amazon? That’s what I do. It’s every day’s Christmas for me on Amazon. I get boxes every day.
Gino (27:43.126)
Amazon. Yep, let’s go to Amazon.
Gino (27:48.576)
Unfortunately, I just got both cutters. I go to Amazon for everything now. A year ago, I just, you know just go right there. It’s the easiest place to get anything. It is. Yeah.
Mike Hambright (27:54.477)
yeah. Yeah.
It’s ridiculous, yeah, and you get it like the next day, awesome. Well everybody, if you wanna learn how to connect with Gino, just check down below in the show notes here, we’ll have everything. Gino, great to see you buddy, thanks for joining us today.
Gino (28:08.642)
Thanks Mike, appreciate it.
Mike Hambright (28:10.698)
everybody will see on the next show.