Subscribe via:
Show Summary
In this episode of the Real Estate Pros podcast, host Q Edmonds interviews Henry Washington, a people-focused real estate investor from Northwest Arkansas. Henry shares his journey from a panic attack that led him to explore real estate investing to becoming a successful investor and co-host of the On The Market podcast. He emphasizes the importance of financial education, the flexibility of real estate strategies, and the need for asset protection as he builds his portfolio. The conversation highlights the significance of surrounding oneself with successful individuals and the necessity of having a reliable income source beyond rental properties.
Resources and Links from this show:
-
Listen to the Audio Version of this Episode
Investor Fuel Show Transcript:
Henry Washington (00:00)
it’s usually crazy. mean, usually when God wants you to do something, it sounds crazy, but things are only crazy because you haven’t surrounded yourself with people who have already done the thing that you think is crazy, right? So like who you choose to be around you lets you know what’s possible. And the more you can surround yourself with people who are doing the thing that you think is hard, the easier that thing will become.Quentin (01:58)
Hello everyone. Hello. Welcome to the Real Estate Pros podcast. I am your host Q Edmonds. And again, you probably know what I’m going to say. I’m excited. I’m excited to be here. Always a great opportunity when I get to meet new people. People who’s doing what they do at a high level. People that’s competent at what they’re doing and people that can share their nuggets and gems and just help us see things through their perspective. And today is no different. I mean, this guy kind of won me over.when he told me, listen, I’m a people-focused investor. Like, that’s the way that I roll. And that kind of won me over. Like, he’s more concerned with people, ⁓ and it got to make people sense more than business sense. And to me, that’s at the heart of any kind of business that’s sustainable, if somebody that has a servant’s heart. And so this guy’s here to serve the people. Yeah, he gonna make money. He’s gonna make money. But he’s here to serve the people. And so I am so glad.
to introduce you guys to Mr. Henry Washington. Mr. Henry, how you doing today,
Henry Washington (03:00)
I’m well, buddy, thanks for having me, I appreciate it.Quentin (03:03)
Yeah, absolutely, man, absolutely. So glad to have you on. Just not blowing steam, man. I’m really excited for people to see things through your lens, man. I don’t care how many people I have on, every person is unique. Every person has that unique lens. And I always walk away with like, dad, that was an incredible gym. And you’ve already given me some stuff that I’ve written down already. So I just know how people are to get some great information from you, man. And so I’ll be honest, bro. I kind of want to dive in, man. I want you to take us into your world.I want you to tell us what you’re mainly focused in these days. If you want to give us a little bit of an origin story about how you got started, we love origin stories. And also tell us what markets you’re operating in.
Henry Washington (03:44)
Yeah, man. So again, I’m Henry Washington. I’m a real estate investor in Northwest Arkansas. I’ve been in the business since 2017. I bought my first house and I have the pleasure.podcast and the co-host of the On The Market podcast on BiggerPockets. So I get to give back to people through ⁓ sharing my journey ⁓ with real estate, which is a lot of fun. ⁓ Yeah, man, I got started out of necessity. I was like a lot of other people. I was working a full-time job. I was in IT. I make great money, ⁓ but I didn’t have a lot of money. I spent it all doing
Nonsense really, I just didn’t have any financial education. ⁓ And I got married and then after I got married, I realized that my poor financial decisions were now impacting more than just me. It was inhibiting my new wife’s ability to do things that we wanted to do. couldn’t, we couldn’t buy a home together. I couldn’t be on the loan for the home we were trying to buy. ⁓ You know, my credit was bad. It was hurting our interest rates on.
you know, cars, just normal life stuff. And I was realizing that I didn’t have any extra money to supplement for all these, you know, poor financial decisions. And so, ⁓ really just had a wake up call, ⁓ one night via a panic attack and, you know, at three in the morning was searching for ways to make extra money. And I learned about real estate investing. I’d stumbled on some bigger pockets articles and just started digging and saw that.
people were investing in real estate and like normal people were investing in real estate. And I just thought if everybody else has figured out how to do this, there’s gotta be a way to do it. I mean, I was seeing people that were doing it with no money and little money. And it was just like, all right, there’s all these regular folks can figure it out. I gotta be able to figure it out. And then I don’t know, I just felt a, just felt a peace about real estate as an option. I don’t know.
I don’t really know how else to explain that. just felt like it was something I was supposed to do. So I was like, all right, I’m going to go figure this real estate thing out. In hindsight, it made no sense. I had bad credit and no money, but I decided, and I couldn’t be on the loan for the house I was living in when I had the panic attack. And so my fix to that problem was to go buy houses, which is kind of insane to think about, but you know, whatever.
Quentin (06:54)
Yeah.Yeah.
Yeah. Yeah.
Henry Washington (06:58)
That’s the feeling I got, you know, I’ma believer in God and I just felt like God gave me a piece about it. So I was just going to go figure it out. And so I just made a decision at three in the morning that I was going to figure out how to be a successful real estate investor. Like I truly made that decision. Like you could not tell me I wasn’t going to figure it out. ⁓ And so I just started diving in. didn’t know where to start. ⁓ Stumbled on Rich Dad Poor Dad. I basically told one of my friends that was a commercial investor that I wanted to start investing and she brought me the
box of books and basically handed me that book and was like, you should read this. And so I read it and I was like, okay. Yeah, I’m doing, I’m doing money wrong. And so, ⁓ started making some changes with how I was saving money and just literally immersed myself in anything, real estate culture. I went to every meetup I could. went to sit in on every webinar I could, I just listened to every podcast I could just absorbing information. then, ⁓ just one of the things I believe is the, in this
in this world, you get what you give. And ⁓ I just started calling myself a real estate investor just because you want to take on that persona so that the universe starts returning things that investors get to you, even though I had no idea how to do a deal. And ended up with a lead for a good deal. But I had to close in 30 days and my buddy was like, I’ll sell you my house.
Quentin (08:07)
Yes, ⁓Henry Washington (08:20)
But I got to get it sold in 30 days. As long as you can buy it 30 days, I’ll sell it to you for $116. It’s worth $170, $160, something like that. And I was like, all right, cool. I’ll buy it. And I didn’t know how to buy it. And I literally just decided I’m just going to figure this out until somebody with some sense stops me. And so I ended up putting the house under contract. I had to Google how to do that. I didn’t know how to do that. And then I had to, and then I went to the bank.Quentin (08:44)
Okay.Henry Washington (08:47)
to get a loan because I didn’t know where else to get money. So I just went to a bank and the banker told me I needed a 15 % down payment, but he’d give me all the money for the purchase price and for the renovation. And, uh, but I didn’t have the down payment. And so then I had to go figure out where to find it’s like 20 something grand in 30 days. And, uh, I couldn’t figure out where to find it. So I called an investor buddy of mine and he brainstormed with me and hetaught me or showed me or talked to me about the idea of borrowing it from your 401k. And so I researched that and figured out I could borrow it from a 401k. And then I had to ask my wife if we could borrow it for her 401k because I didn’t have one. And so we borrowed the money. bought the house. I rented it out and ⁓ it started to cashflow and pay back all the loans and all the expenses of the home and still put money in our pocket every month. And I just kind of had this epiphany that like, all right, this is clearly
something that’s doable and repeatable for anybody. ⁓ And then the banker, after we closed, called me and asked me to take out, he’s like, you should take out a line of credit on the equity and then use that line of credit for your down payment for your next one.
And I didn’t know what that was, so I had to Google that and he kind of talked me through it. And so I actually ended up taking out a line of credit to like, to the tune of like $30,000. And so, you know, to go from panic attack about money to 90 days later, owning an asset that was
paying for itself plus paying me plus I have $30,000 staring at me in the face. Like I was like, ⁓ like this is absolutely doable and achievable. And I didn’t know there’s people who are in worse financial positions than me who probably don’t know how close they are to changing their life forever by doing the right real estate deal. And so that’s when I knew in that moment that God didn’t lead me down this path so I could figure out.
Quentin (11:09)
Mm-hmm.Henry Washington (11:15)
how to be wealthy and take care of my family. feel like he led me down this path so that I could help show other people that this is something that they could do to change their lives. I immediately knew it wasn’t for me. And so that’s actually the day I started my Instagram. You can go back and see my old posts. I had to do this trash. I didn’t know what else to post. I just was like, I have to show people. So I’ll just start posting what I’m doing and maybe somebody will pay attention. And now I get to be on podcasts and speak on stages and.Quentin (11:37)
Yeah. Yeah.Henry Washington (11:43)
It’s been an incredible journey, that was what started it all.Quentin (11:48)
Absolutely. Man, what an amazing origin story, bro. Thank you for sharing it. Yeah, your podcast, BiggerPockets, I get mentioned so much, so many people I know about and I mention it, especially in the world that I’m in. But man, your origin story, they say that it takes a certain level of delusion to be successful, right? Like, when veins don’t look like a shit. Right, exactly, right? I was at, I don’t know if you ever heard of an author named Mark Batterson. writes,Henry Washington (12:09)
Yeah, you got to be crazy. Yeah. Yeah, you got to be crazy.Quentin (12:17)
I was at a church that he passed us yesterday and he said, impossible goes to hard, hard goes to done. It starts off as impossible. Then once you start doing it, okay, it’s hard, but then once the hardest finish, you’re done. And so when I think about what your journey is like, yeah, it made it sound crazy. Then you did it and now it’s done. And now you’re looking back like, woo, woo. And I tell people all the time, faith is when you take what God told you.Henry Washington (12:29)
Mm-hmm.Yeah.
Yeah.
Quentin (12:45)
and you operate in what he told you. You got the word that he told you and you just working out the word that he told you.And that’s what it sounded like to me, man. You put your faith in action because you heard what God said and you like, okay, I’m gonna go out and do this thing. And here we are, man. You know, I’m sitting across from you, man, getting these gems. So I really appreciate the origin story, man.
Henry Washington (13:05)
Yeah,it’s usually crazy. mean, usually when God wants you to do something, it sounds crazy, but things are only crazy because you haven’t surrounded yourself with people who have already done the thing that you think is crazy, right? So like who you choose to be around you lets you know what’s possible. And the more you can surround yourself with people who are doing the thing that you think is hard, the easier that thing will become.
That’s why your parents always told you when you’re a kid, right? Like, you know, you.
you’re not gonna jump off a cliff, if Billy jumps off a cliff, but he probably would. That’s why she don’t want you hanging around with them folks, right? So, if you take that and use those powers for good, right? If you surround yourself with people who are doing things that you think are hard or impossible, you’ll look like the crazy one, because you can’t do it, or you haven’t done it yet. And you’ll start to realize how easy it is. ⁓ I’ve told the story of…
Quentin (13:38)
I’m about to say, yeah, something would. Yeah, yeah.Henry Washington (14:02)
100 times, but we interviewed somebody on the BiggerPockets podcast who bought, it was like a 200 unit apartment building for his first deal, very first real estate deal. And we were like, why did you, why made you do that? Like most people buy a single family and then they buy a duplex and then they buy a small apartment building. And then they, you know, they, they worked their way up and finally realized that they can do these bigger deals. And he said, honestly, all of my friends own department buildings. I didn’t know I wasn’t supposed to do that. Just did it.Right? Like it only, it only seems hard because of who you’re around. And it was just, it was that easy for him. So in other words, if you think this is hard, get around five people, spend your time, the most of your time around three to five people who do this every day. And if you can’t do that physically, do it virtually, like stop, unfollow all the nonsense and start following real estate investors who are doing actual deals right now. And all of a sudden it’ll seem like it’s easier.
Quentin (14:53)
Yeah.Absolutely. Man, you’ve been dropping gems. I want to ask you this. What is one key strategy or key quote, key motivational point that kind of keeps you going, that keeps you running smooth, that can kind of like censor you as you keep doing what you do, man? Is there one key strategy that you can think of?
Henry Washington (16:01)
One key strategy? No. ⁓ If you’re new, I would say that one of the best parts about real estate is how flexible it is. Like you can make money in multifamily real estate. You can make money in storage units. You can make money in single family real estate. You can flip houses. You can Airbnb. can, you know, you can do midterm rentals. You can. There’s a million ways to make a million dollars in real estate.which is cool, but it’s also extremely overwhelming when you’re new because you’re like, where do I focus? Like, what should I do? And I always tell people, first thing you got to know is your financial goals. How much money are you trying to make and at what time frame are you trying to make it? Because your goals should dictate your strategy, right? And so if you know you need to make a lot of money fast, then buying rental properties that cashflow a hundred dollars a month right now.
isn’t going to make you a lot of money fast. It’ll make you a lot of money in 15 years, 20 years. You’ll be sitting pretty, but if you need to make a lot of money fast, then that probably doesn’t need to be a strategy, right? If you’ve got money and you need wealth later, then rental properties is probably a great strategy. So you need to know your strategy. But once you know how much money you’re trying to make and how soon you’re trying to make it, all you need to focus on is the lowest common denominator. And the lowest common denominator in real estate is a deal.
Because it doesn’t matter if you want to Airbnb short term rental, long term rental, buy storage unit, buy an apartment building, buy a mobile home park. If you want the numbers to make sense, you have to have bought a good deal. You have to have bought a deal at a discount. And so if you don’t know where to focus, like you don’t know what exit strategy you want to use, don’t worry about the exit strategy. Worry about the entrance strategy and the entrance strategy is
What does a good deal look like in the market I want to buy deals in? Figure that out. You can ask people. Go to investor meetups. Ask an investor to tell you about their last deal. You know what they’ll do? They’ll tell you everything about it because investors love talking about their deals. Like you’ll learn so much about what people are buying properties for, where they’re buying them, how much they’re making when they’re selling them or renting them. They’ll tell you all that information. They’ll be glad to tell it to you.
Quentin (18:16)
Yeah.Henry Washington (18:27)
Learn what does a good deal look like in the market I’m looking to buy good deals in and then pick one strategy. One strategy to find deals. Whether that’s going to be a strategy for on market deals or off market deals, it doesn’t matter. Pick one. They all work, but they only work if you give them enough of the resource that it takes for that method to work. Because finding deals costs something. It’s either going to cost you time or it’s going to cost you money. You can find deals for free, but it’s going to take up your time and you can find deals with money.That doesn’t take time. So you need to know how much of the resource do I have? And then you pick one strategy that you can afford to fund appropriately and do it until it gets results. Period. Don’t worry about how you’re going to make money on the deal. Because if it’s a deal, you can make money a million different ways. Just lowest common denominator. Figure out how to find a good deal. Do the thing to find the deal. Once you find the deal.
Quentin (19:13)
Hmmyou
Henry Washington (19:19)
you’ll be able to figure out how you’re going to monetize a deal. That’s a problem I’d rather have. I’ll go figure that part out later. Just go find the deal. People want to solve the money problem first. They want to go figure out, I want to go flip houses. I need to go find house to flip. No, just go find a house at a good deal. Maybe you won’t flip it. Maybe you’ll wholesale it. Maybe you’ll wholesale it. Maybe you’ll flip it. Maybe you’ll rent it. You have no idea. You haven’t seen it yet. Just go find a good deal.Quentin (19:25)
Yeah.Yeah.
I love it. Man, I’m writing down things that you say I love. You say goals should dictate your strategy. I think that’s an absolute, absolute bar, absolute gem. And with that being said, man, I would love to know what’s the next real goal for you.
Henry Washington (20:01)
Yeah, ⁓ I am focused on asset protection. So ⁓ what I mean by that is if you think of investing in three phases, most investors are going to operate in one and a half of these phases at a time. So there’s a growth phase, which is you’re building your portfolio, right? You’re building up your nest egg, right?Typically that’s going to be with leverage. You’re to be using debt to acquire property. ⁓ And then there’s a, then there is a stabilization phase, right? Because properties don’t perform like we underwrote them to perform unless we add the value by fixing them up. Right. And so you’ve got to stabilize those assets. And then the third phase is protect those assets. So yes, I own over a hundred rental properties.
But I actually only own two of them because those are the only two that are paid off. The rest, the bank own. The bank can take those from me at some point if they want to. ⁓ And so those assets technically are not protected yet. And if we’re truly trying to wealth, generational wealth, like that’s the hot buzzword people like to use. We can’t pass generational wealth on if your assets are leveraged. That’s not wealth. Right. ⁓ So.
So I’m at a place now and so when I say most investors are to operate in one and a half of those buckets, right? So when you first getting started, you’re operating like 80 % in the growth bucket and like 20 % in the stabilization bucket. And then at some point you’re comfortable with your amount of properties and you’re operating probably 80 % in stabilization and 20 % in the protection bucket. And then you can slowly transition more so into the protection bucket.
But the key thing you need that goes across all three phases, that goes across all three buckets, is you need an income source, right? Because rental properties are not an income source. And I think that that’s a big myth in real estate investing. Leveraged rental properties are not an income source. It is very hard to live off your cash flow because it’s so dynamic. could make, the money you make month to month will depend on
Quentin (22:19)
Okay.Henry Washington (22:27)
what your expenses are month to month and your expenses shift. And I know people budget for things to go wrong as you should when you underwrite. I budget 10 % of my rents to go towards capital expenses, right? ⁓ I budget 5 % of my rents to go towards normal maintenance expenses. But just because I budget 10 %Quentin (22:37)
.Great.
Henry Washington (22:51)
doesn’t mean I’ve accumulated enough in 10 % payments to cover an expense that happens tomorrow. So if I bought an asset six months ago and I’ve been putting away 10 % of the rent for six months and the HVAC goes out in six months, I gotta go spend eight grand on an HVAC. I haven’t saved eight grand in what I underwrote yet. And so that money has to come from somewhere, right? Where’s it gonna come from? It’s gonna come from some of your cashflow.Quentin (23:02)
Yes.Yeah. Yeah.
Henry Washington (23:17)
Right. And so it just,it doesn’t, it just, because you underwrote an asset to operate where it’s paying you $200 a month, doesn’t mean you’re going to get $200 a month if you have an expense that hits before you have the savings to cover that expense. And so it’s very hard to live off cashflow. And so, ⁓ you have to be able to, if, if rental properties are your, are your strategy, if you’re truly going to grow, you have to have an income stream other than your rental properties.
to help you leverage. And so for me, that income stream is flipping houses. So I flip houses that helps me generate income. That helps me buy assets if I’m trying to scale. That helps me stabilize assets if I’m trying to stabilize them. And then I can take flip proceeds and help me pay off assets. And the more assets I pay off, the more cashflow you get. Now you get to the real cashflow, the cashflow you can live off of. Because if I have a rental property that’s producing $100 a month,
Quentin (23:52)
Yeah..
Henry Washington (24:16)
of cash flow with a mortgage, but I pay that mortgage off and it goes from producing $100 a month to $1,200, $1,300, $1,400 a month of cash flow. That’s real cash flow. And the more paid off assets I have, the less houses I have to flip because I’m making more money. And so that’s my strategy to kind of taper off. So right now I’m focused on stabilization and paying off assets so that I don’t have to do this anymore if I don’t want to. Now,Quentin (24:42)
Yeah.Henry Washington (24:42)
Once I get all the assets paid off that I want to get paid off and I’m making the money that I want to make every month, will I stop? Nah, probably not. But I still need to protect a portion of what I’ve got so that I have the things to pass on to my family.Quentin (24:54)
Absolutely. Man, you think this, why, you know, listen to your origin story. This wiring that you have for real estate, the way you think about real estate, the way you analyze it. Do you think that wiring came from just the experience once you got experience in the real estate game? Or you think that wiring is something that was in you that you kind of attribute to every aspect of your life? Like do you, is that wiring something that just come innate or did it come from experience in the real estate game?Henry Washington (25:21)
I think it’s a little bit of both. mean, the more you spend time doing a thing, the more knowledgeable and confident you’re going to become. the more, and I’ve spent a lot of time around a lot of people who are way smarter than me and way better than me at this. And you’re just innately going to pick up things that are, mean, you have this podcast, you do that, you know, every, every week on this podcast, right? You hang out with people and you learn something that makes you smarter. Right. ⁓And so I think it’s that ⁓ for sure. But I also like, ⁓ you know, my father was a school teacher. So didn’t make a ton of money as a school teacher, but he was also very entrepreneurial. He had to have a side hustle to make the kind of money he wanted to make to live the lifestyle he wanted to live. So he owned an arcade at one point back when you had to go to a place to play video games. You couldn’t just play them in your living room. ⁓
Quentin (26:17)
People don’t know nothingabout that, But yeah, yeah, yeah. I know it’s been the days.
Henry Washington (26:20)
Yeah.He owned an arcade at one point. He used to have an ice cream like little trailer. He would tow around on he’d ride a bicycle and go to parks and tow this little ice cream trailer and sell ice cream. He owned a barbecue restaurant for 10 years while I was growing up. So like I saw my father have side hustles and other businesses. Now he never
talked to me about being entrepreneurial. He never was like, you need to get a job and then you need to get a side hustle. Like he didn’t want that from me. Like he just wanted me to go to school, get a degree, get a job and, and, and get benefits and work my way up the corporate ladder. So it’s like, he never talked to me about it, but he, he, that’s the example that he set. So when it was time for me to do this, I was never really scared about starting a business. Like I just had that confidence, I think, because I saw him do it.
I figured I’d it out.
Quentin (27:20)
Yeah. No, man. Henry, man, I appreciate you. This has been wonderful, man. Honestly, as we talk, I’m like, so many different other questions popping in mind. But I said I was going keep it hey, 20 minutes. We’re a little bit over. But man, this has been great. You are somebody I can talk to forever. I feel like you have just a deep well of knowledge that our viewers could just get just a ton of spring water from.Henry Washington (27:34)
Yeah.Quentin (27:49)
keep keeping on the analogy of the well, right? But, listen, man, before we wrap, if someone wanted to reach out to you, connect with you, collaborate, learn more about what you’re doing, brother, how can they reach out to you,Henry Washington (28:02)
Yeah, you can go to my website, www.seeyouatthetable.com. all spelled out, S E E Y O U A T T H E closing table dot com slash home. And you can check out my website, fill out the form there, or you can just follow me on Instagram. I’m at the Henry Washington on Instagram. Give lots of free information away there.Quentin (28:25)
But there he is, Mr. Henry Washington. Y’all can’t tell me y’all ain’t getting value from this joint. So man, thank you so much, man. Thank you. Thank you for your story, for your perspective, definitely your perspective, just the way you think, the way you see things. That was really a pleasure, man. Thank you for your time, brother. So it was really a pleasure, man. Thank you for being here today.Henry Washington (28:45)
I thank you for having me. appreciate it. And thank you for what you do for people.Quentin (28:49)
Absolutely. Well, listen, like I said, drop, you can’t tell me I ain’t getting the value. I mean, he just dropped gym after gym after gym. And so go ahead and subscribe. Just hit the bell. That way you know when the show come on and you can just hop in and just get all of this valuable content. so Mr. Henry man I can’t thank you enough again, sir. Appreciate you so much. And so everyone else, listen, we’ll see you on it next time.
