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Show Summary
In this conversation, Kevin Kim shares his remarkable journey from federal prison to becoming a successful real estate investor focusing on tiny homes and ADUs. He discusses his innovative strategies for acquiring properties with no money down, leveraging his nonprofit status, and the growing demand for affordable housing solutions. Kevin also highlights the importance of mentorship and collaboration in the real estate industry, emphasizing the need for proper partnerships in ground-up construction projects.
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Investor Fuel Show Transcript:
Kevin Kim (00:00)
Wow. So if you didn’t read my deck, know, my slogan is from parole to CEO. So I went to federal prison back in 96 and you know, in Club Fed, they got senators, rich people, ⁓ and they taught me real estate. And I want, you know, I want to change my life. So they taught me that. I was dumb enough to believe what they taught me. And I walked out of prison with my nonprofit.And I registered with HUD and my first deal on federal parole, I bought $3.2 million of real estate with no money down. couldn’t believe it. Changed my life.
Dylan Silver (00:35)
Hey, folks, welcome back to the show. Today’s guest is an investor based in Los Angeles, California, focusing on tiny homes, ADUs and is active across multiple states, including Georgia and Utah. Please welcome Kevin Kim. Kevin, welcome to the show.Kevin Kim (02:26)
How you doing buddy? Thank you for having me.Dylan Silver (02:28)
It’s great to have you on here, but I always like to start off at the top by asking folks how they got into real estate.Kevin Kim (02:35)
Wow. So if you didn’t read my deck, know, my slogan is from parole to CEO. So I went to federal prison back in 96 and you know, in Club Fed, they got senators, rich people, ⁓ and they taught me real estate. And I want, you know, I want to change my life. So they taught me that. I was dumb enough to believe what they taught me. And I walked out of prison with my nonprofit.And I registered with HUD and my first deal on federal parole, I bought $3.2 million of real estate with no money down. couldn’t believe it. Changed my life.
Dylan Silver (03:11)
What year was that?Kevin Kim (03:12)
That was in 2006.Dylan Silver (03:15)
96. So walk me through that first deal. Because really the first deal everyone remembers that first deal. That was a big deal. What was it like?Kevin Kim (03:17)
Yes.Wow.
Well, to tell you the truth, my first deal was 15 properties at one time. So the leverage I had was nonprofits registered with HUD and they’re what’s called affordable housing provider. So their job is to get an incentive, which is a discount from HUD, pass it on to the end user. So that was what made us affordable. So let’s just say a fourplex in a signal hill would go for 500,000.
but it was already distressed i would pick it up for one seventy on a bid and i would get thirty percent of that one seventy so there is a humongous ⁓ act you know i’d use on there but what i was supposed to do is pass it on to the end user some of it so what what we were saying for his we are not probably so the only ones legally allowed to gift down payments to the buyer
Dylan Silver (04:02)
Yeah.Mm-hmm. There it is.
Kevin Kim (05:07)
my gimmick was or not a gimmick but my strategy was as soon as i bought these properties i would put up i would put up a sign get pre-qualified and you can pick paint your color of carpet color paint your your toiletry your kitchen cabinets all of that because i didn’t care because i was going to put that in brand new anyways so the house was literally sold with the gifted down payment before it was even doneSo once I learned that, that became my new hustle. And I couldn’t believe that what we call hard money lenders, know, Robert Allen is the king of zero money down. I used to teach for him after I got out and they found out who I was and they’re like, you’re amazing, can you come do our seminars? So learning, it seems like a scam when you tell somebody on TV or in a commercial and now social media,
Hey, you can buy property with zero money down and walk away with $60,000 profit. You’re like, you know, get the hell out of here. No way. And it’s true. But if you got to learn what the reverse engineering is, and once you learn the method and the math, it’s easy. Right? But I had a cheat code which was being able to be non-profit, affordable housing, believing that I could go register.
on federal parole then go to a hard money lender, a Jew guy and he’s like that’s amazing all those properties we’ll buy, mean we’ll fund because they all got a lot of meat on the bone and I was like get out of here you’re kidding me right this can’t be this easy right and I was like I had to come to prison to learn a new hustle to come out and make millions of dollars and flip properties all through a non-profit
Dylan Silver (06:51)
want toask you about the homes themselves in that first deal. It sounds like there was 15 plus homes. Were these ground up construction? Were these flips? What were the homes?
Kevin Kim (07:01)
Now,these are houses in the ghetto and in decent medium ⁓ income areas. They were a HUD. So HUD has blighted property. ⁓ So they were just basically tenant improvement. Maybe some needed a ruler, but basically it was carpet, paint, toilets, cabinets, ⁓ and clean up the yard and put it up for sale.
Dylan Silver (07:27)
And so where are you going and putting these on the MLS? Were you finding buyers directly? What was your exit strategy?Kevin Kim (07:34)
Man, I had so many realtors. They were so mad because every time a realtor would go to bid on a HUD property, they would see my nonprofit and they couldn’t understand how these nonprofits were bidding so high because they didn’t know that we got a 30 % discount. So their 150 bid and my 200 bid, I still beat them by $20,000 below what they were bidding. So once they found that out,Dylan Silver (07:59)
That’s Huge, ⁓Kevin Kim (08:01)
once theyfound that out, yeah, once they found that out, they were lined up at my office saying, can you bid on this property? We have a buyer for it and we’ll give you cash right now. So yeah, I had real estate agents that I networked with that are movers and shakers and I would give them first car Blanche and they would move it. But my properties, once I put that sign up, I would have buyers just come.
Dylan Silver (08:21)
Yeah.Kevin Kim (08:27)
and they couldn’t believe that I was going to give them ten, twenty thousand dollars and I would just point them to my realtor that I was networking with.Dylan Silver (08:33)
You know,I want to pivot a bit here, Kevin, and ask you about the strategy that you’re using right now, which is the tiny homes and ADUs out in California. I think a lot of out of state investors will be surprised to hear this and they may be looking at, how do we get involved now? So you’re looking at putting ADUs and tiny homes in the greater Los Angeles area. Walk me through that.
Kevin Kim (09:33)
Yeah, so there’s a need. There’s definitely a, I’m very fortunate to be politically connected. So I get a lot of information and FIFA and the Olympics are coming to, you know, the United States and especially Long Beach, LA. So they’re trying to fight the homeless housing problem. And also people coming from out of the country that need places to rent, you know,for long-term and or ⁓ Airbnb’s and They’re trying to feel that need so they’re asking developers like that. How can we get creative? So the cities are Making it easier. It’s a process and I forgot what it is the name of it but where where if you have a big lot small house and you can fit an ADU in the backyard and Also, you can turn the garage into ADU
that’s going on right now like there’s a there’s a famous guy and i’m gonna give him a plug because i really believe in his course his name is thatch and it’s called springboard and that is that vietnamese guy that came across the water with no money down there gonna kill his family and all the ⁓ all the refugees they came over here and now he’s a multi-million dollar ⁓ real estate investor he sells his course and he’s really good at what he does
Dylan Silver (10:50)
I want to say I’ve met him. Where is he based out of?Kevin Kim (10:52)
Thatch, believe is in Washington or Seattle or somewhere. But you know, it’s that guy that talks like this, you know, he always has the mindset, the mindset sweater.Dylan Silver (10:56)
Okay, maybe.I need a…
want to say I’ve met him. I think we’ve crossed paths before. I want to ask you about that. You mentioned the the focus on not just ⁓ housing for for FIFA right and for for all the people that are going to be coming there to watch the event but also on the flip side the homeless issue. So this is really a double sided issue double sided coin here. Do you feel like other cities around the country may may start to look at a similar strategy as well.
as far as tiny homes and ADUs.
Kevin Kim (11:32)
of course Atlanta is really popular, super popular. Some of the developments there you couldn’t even believe, they’re immaculate.Dylan Silver (11:35)
Are you putting?Are you, I know you’re active in Atlanta, are you looking at ADUs and tiny homes out there as well?
Kevin Kim (11:44)
you know that’s where i started out at in tiny homesDylan Silver (11:46)
Okay, okay. So as a Texas licensed realtor myself, when I heard about tiny homes and when I was seeing them more and more, I was thinking, well, this is really a solution to both the housing crisis, really, but it’s also a great. That’s right. It’s a great opportunity for both sides because you can a in many cases, these are modular builds. So offsite stick built construction.Kevin Kim (12:01)
and affordabilities.Dylan Silver (12:13)
⁓ or even reinforced. I’ve seen some of them be steel built, like disaster resilient. And you can put so many of them together in a community, so you don’t even need all that much land in order to have a small community together.Kevin Kim (12:28)
yeah there’s six hundred two twelve hundred square feet and what’s what’s amazing is I don’t know how much you know about it but the Mecca the what we call the the the program to copy is in Texas these people are famous people from around the world come and they look at the model they built and they even have ⁓ you know literature how to do itand go in your own country or your own city and do it. And it’s right there in Texas. I forgot the state, but I was supposed to take a trip with my business partner to go look at what they build out there.
Dylan Silver (12:59)
I believe it. was looking at some modular homes in Texarkana, which is really out there in Texas. I guess the closest city would be Dallas-Fort Worth Metro. But one of the things that really stuck with me was you mentioned the affordability, you mentioned the size. I will also want to throw out the customization. People may not be aware that you think of modular home. I think a lot of people still think about mobile homes. And that’s really a false ⁓Kevin Kim (13:21)
yeah!Dylan Silver (13:28)
similarity because it’s not at all like that. These are offsite stick built homes that are in many ways even more ⁓ sturdy and of higher build quality than on site because you’re not dealing with the weather conditions. They’re repeatable but they’re also customizable.Kevin Kim (13:43)
Let me tell all your viewers if you as an investor if you do not research and get into tiny homes You’re gonna be in three years. You’re gonna turn back like damn. I should have listened to that guyDylan Silver (13:53)
No question, no question. I do want to ask you about Utah as well, Kevin. I actually am a little ignorant on Utah. What’s the market like out there? Are you investing in tiny homes as well in Utah?Kevin Kim (14:46)
No, is my cousin, which is my business partner, which is my contractor and partner. He’s a master builder. We’ve been building since we’ve been doing HUD. So we’re doing a portador. We’re taking raw land in the bougie areas of Utah, because my two nephews are ex-NFL football players. We take the NFL football players’ money, and we invest it into land. And we build custom homes.Dylan Silver (15:12)
The custom home space ground up construction is particularly interesting to me as someone myself who’s worked with a lot of flippers and in the distress real estate space I’ve noticed there appears to be at least on some level a trend towards a single-family home investors moving in some part from fix and flip more towards ground up construction and new builds both because the margins are a little bit slimmer on fix and flip but also becauseThe process and the information to do ground up construction is more readily available as well.
Kevin Kim (15:45)
Of course.Dylan Silver (15:46)
Are you seeing that trend as well? And it sounds like with your cousin, the contractor, you’re involved in that ground up construction. Are you seeing ⁓ more investors get into ground up construction and even subdivision building and so on?Kevin Kim (16:00)
well with with anything it’s all about your your chessboard right so somebody can come in and and you can really get reamed and get taken advantage of you don’t if you don’t have the right construction partner right so everybody’s trying to make profit off your profit and not understand that’s a long game so somebody could go to texas or california and say i’m gonna get in the development game okay coolIf you don’t know how to negotiate for the right land price, if you do not have a streamlined system on where to buy your materials, hire your right contractors or your workers, you can really get screwed. So we have a streamlined and that’s what makes everybody, you know, that’s popular on the internet. Like you got my boy Eric, Eric is in Miami. He’s the white guy that got out of prison, didn’t have a pot to piss in.
and now he’s building three five million dollar properties and he’s selling his course in Miami right so if you don’t have your system down yeah if you don’t have your system down then you can really get screwed but then you got guys like me that tell you I came out of federal prison bro and and I’m killing the game and they’re like how do you do it trial and error well how do I know that or how do I learn that buy my course for seven thousand dollars and our you know games meant to be sold not told
Dylan Silver (16:57)
Yes, I know Eric.That’s 100 % right. in the real estate space, I’m sure you’ve seen this as well, Kevin, you’ve got more people willing to help and really collaborate. But at the same point in time, you can leapfrog time and a lot of, I would say, obstacles that would come up by exactly by aligning yourself with folks who’ve been there. Even if you have to pay to be in those rooms, I know I certainly have been and have done that before.
Kevin Kim (17:36)
Private Error.that
that’s what i call my hindsight consulting i can’t say you from getting those pitfalls if you just pay if you if you hire me as a mentor coach and i was streamlined instead of all i’m is cookie cutting i can’t be in in fifty two states so you know i’ll give up a little game all of these guys who sell courses that’s where they’re looking for bird dogs so what they do is they go to the seminar they saw the dream what is really not a dream is really real but you’re too lazy
to even read the thick book. So you’re gonna go to them and say, hey, how can I just invest my time, credit or money and bring you deals and then we partner with them and they JV. And they got bird dogs in every state. So you got Tom that took the course in Birmingham, Alabama. He just knows just enough on how to find the deal to get it where he can submit it to me or Thatch. And we were like, this is a winner. Hey, we’re gonna partner with you. We’ll send you a check in the mail when it’s done.
And there you go, now you got thousands or hundreds of people working for you around the state that are bird dogging and it’s a fair deal. know, fair trade ain’t no robbery.
Dylan Silver (18:49)
No, absolutely everyone everyone benefits. Kevin, we are coming up on time here. Where can folks go if maybe they’ve got a deal in one of the markets that you’re active in or if they’re interested in mentorship or they’d like to reach out to you?Kevin Kim (19:03)
Yeah, so my Instagram is at Coach Kevin K. You can DM me there and I’ll be having my course up in a minute. And if they want to hear my story and see what I’m about, they can go to ⁓ sosconsultinggroup.com and that’s my nonprofit. So if anybody wants to get in the nonprofit game and learn affordable housing and learn how profitable is doingreal estate through nonprofits, very, very, very successful.
Dylan Silver (19:32)
Kevin, thank you so much for coming on the show here today.
