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Show Summary
In this episode of the Real Estate Pros podcast, Elizabeth Luna shares her journey from corporate marketing to becoming a full-time real estate problem solver in San Antonio. She discusses the importance of networking, building strong contractor relationships, and adapting to market changes. Elizabeth emphasizes the need for continuous education and creative strategies in real estate investment, offering valuable insights for both new and experienced investors.
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Elizabeth Luna (00:00)
So I bought her out and that home was just screaming. It was screaming that it needed to be a senior care, a senior residential care home. And so ⁓ I started marketing and reaching out to those people in that industry. And sure enough, we got a ⁓ five-year contract. It’s triple net. And so now they are paying all of the taxes, the insurance, the maintenance, the…Kristen (00:11)
Mm-hmm.Elizabeth Luna (00:27)
everything and the base rent. So ⁓ had I not pivoted, I would have lost out on that opportunity from having just a traditional gross rent paying long-term tenant to now having a five-year triple net tenant.Kristen (02:15)
Welcome back to the Real Estate Pros podcast. I’m Kristen and I’m here with Elizabeth Luna, who is a full-time real estate problem solver out of San Antonio, Texas. She’s been doing this since 2004. So I’m excited to get into it. Thanks for being here, Elizabeth.Elizabeth Luna (02:27)
Thank you for having me, Kristen, I really appreciate it.Kristen (02:29)
So you have a great portfolio. You have buy and holds, flips, short term, mid term. How did you get into this industry to begin with?Elizabeth Luna (02:39)
So my background is corporate marketing and public relations and I started investing in real estate back in 2004 because I wanted to diversify my sources of income.⁓ I did a lot of reading back in the day and everything that I read was leading to real estate. And so while I had my day job, and as a single person I started investing in real estate and started buying a small portfolio ⁓ over the years, working nights, weekends, holidays, ⁓ self-managing, handling my own property tax protests, and slowly over time building my contractor crew. And a crew that
I still have today, 20 years later. So we’ve had a wonderful relationship. so after, and in the corporate world, I’m sure you hear, and your viewers hear a lot about layoffs. And after the third corporate marketing layoff experience, my financial advisor set me down and ⁓ then about five years ago, ⁓
Kristen (03:25)
wow.Elizabeth Luna (03:52)
told my husband, ⁓ Elizabeth’s doing better in real estate, let her do that full time instead of going back to a corporate job. So that’s what I’ve been doing ever since.Kristen (04:00)
⁓And how was that transition going from a full-time job doing this on the side and then making this full-time? Was there a learning curve or were you able to just kind of glide right into it?
Elizabeth Luna (04:14)
I was able to glide right into it. think the biggest transition was like the inner guilt of not reporting back to work and that internal struggle of like, what do I do with myself? Am I really doing the right thing? But after about six months, I got over it and.Kristen (04:32)
Yeah.Elizabeth Luna (04:34)
And I’ve just really dove in and to, okay, if I’m gonna do this full time, I need to be serious about this. So I started researching online about ⁓ networking, educational programs, any mentoring programs in the Texas market that would help me hone those skills. And I did find such a program and that helped me ⁓ elevate to the level where I’m at now.Kristen (05:47)
Yeah, I think networking is so important and I know that’s a very strong trait of yours. You’re a connector. So can you talk more about networking and giving value to people?Elizabeth Luna (05:58)
Absolutely. networking is very important, but more importantly, if you really want to survive in this industry, you need the proper education and mentoring because this is a very hazardous industry ⁓ financially, ⁓ legally, and ⁓ there’s a lot of risk involved. So you definitely need to educate yourself. And so I’ve made it my commitment over the years to continue that education.And so when I go out to network, I’m able to connect people with.
appropriate resources and ⁓ people and avenues and solutions to whatever real estate problems they have. And that’s why I market myself as a real estate problem solver because whatever the problem is, I know someone who can help solve the problem. It may not be me directly, but I know someone who does. And so I’m happy to make those connections so that way people can have a good experience in real estate.
Kristen (06:51)
Yeah.Yeah, it’s such a great superpower to have, especially in this industry. And I can imagine the more you give value to people, the more it comes back to you.
Elizabeth Luna (07:10)
Absolutely, and as a matter of fact, one of our clients is the one that named our company. And the client named our company Heaven Sent because he came in from Arkansas to handle the estate of his late brother who passed away. And he passed away leaving behind an adult disabled ⁓ nephew. And so this gentleman came in and not knowing where to go and what to do andHe was, we were introduced to each other by his sister-in-law and sat down with him. He needed help ⁓ clearing out the personal property of the house, finding a care home for the adult disabled nephew, liquidating cars, rehoming animals, ⁓ legal guardianship paperwork. mean, real heavy hitting stuff, finding a care home for his nephew. And through the resources that I have cultivated through networking.
groups, non-real estate related, so talking to attorneys, talking to senior care home providers, talking to estate sale people, talking to animal shelters, I was able to help that family and we got that all mapped out in three hours. And so after that meeting, I mean, during, after the three hours, he was like, wow, Elizabeth, you really have incent because you’ve done more for me in three hours than I’ve been able to do in three days.
Kristen (08:24)
Wow, that’s amazing. mean.I love that. No, that’s amazing. I mean, it’s just a really good example of how you’re able to give value and really, you know, change the trajectory of people’s lives. ⁓ I’d love to talk about, you you mentioned before you still have the same contracting team that you’ve had, that you had 20 years ago. How do you go about finding the right people and how do you cultivate that relationship and make sure somebody’s aligned with you?
Elizabeth Luna (08:38)
And so we kept the name.Absolutely. So, you know, I have, we have very ⁓ direct conversations ⁓ with each other on expectations, know, roles, expectations, the scope of work, the budget, and we treat each other as human beings.
more than anything else. And we know life gets in the way. ⁓ And they’re valuable to me. I’m valuable to them because I provide them with steady work, reliable ⁓ checks that’ll clear the bank. ⁓ And so by maintaining that ⁓ human, the humanity level of the contractor relationship, still holding firm boundaries, you still have to have your firm boundaries and hold them accountable for
Kristen (09:19)
Mm-hmm.and
Elizabeth Luna (09:48)
the quality of their work. But we have a high level of trust. mean, we, you know, in the past have shared Home Depot accounts, you know, ⁓ because we know where the materials are going and who’s going to get the credit, who’s going to get the refund, who’s going to get the points,you know, and whenever there’s a big project that I… ⁓
have them working on, you I take the time to bring them breakfast tacos. ⁓ I invite them to the year-end company celebration parties. You know, lot of people leave out these crews and they’re hard workers. They spend a lot of time away from their families and they’re providing for ⁓ a livelihood for their family and their children and their kids are about the same age as mine. So I make, we make the time to invest in each other and with a high level of respect and accountability.
Kristen (11:06)
Mm-hmm.Yeah.
Elizabeth Luna (11:12)
accountability.Kristen (11:13)
Absolutely, and I think that’s something that kind of gets lost in the partnership a lot. Can you talk about maybe a time where things didn’t work out, where maybe you hired someone that wasn’t aligned with you and how you figured that out and dealt with it?Elizabeth Luna (11:26)
Absolutely. So we had a project that was a referral to me through one of my networking resources, non-real estate related, and I got the property under contract with a partner and the partner was funding ⁓ the project. And so she selected the contractor and ⁓ not my crew, which was fine. You know, she was paying the bill. So, you know, we gave her that latitude andWithin a few weeks, we knew it was the wrong person. And eventually I had to step in and ⁓ we fired the person and we got under a lawsuit situation over it, know, tons of fun. And ⁓ we were able to, because of my connections with lawyers and we were able to get a settlement and get it worked out and resolved. then I was at the, after that, it was able to bring in my crews to finish the project.
⁓ And so there are times where you have to ⁓ let people go, you know, and with other people, most of my contractors stay with me a minimum five years. ⁓ And my A team has been with me for 21 years. My B team’s been with me about seven years. And my C team, we’re going about on a one year stretch. So I have tears on my contractors. And the ones that get the big projects,
Kristen (12:36)
Mm.Yeah.
Elizabeth Luna (12:56)
are the ones that are my A-Team. They’re not the cheapest, right? ⁓ There’s always room for negotiation and wiggle room, but I know that when I’m paying top dollar for them, I know I’m gonna get quality work. And if they have, if they miss something, they’ll come back and not charge me for a return trip. ⁓ So they’ll…Kristen (13:00)
Mm-hmm. Yeah.Okay.
Elizabeth Luna (13:18)
ensure that the quality of the work stands by, they stand by the quality of their work. Now if it’s a quick little ⁓ repair at one of my rentals, then I’ll call my B team or my C team. And they still do good work, ⁓ but they’re, you know, they have other projects that they’re working on, not their only client. ⁓ So, you know, I kind of rotate through the workload to disperse the work.Kristen (13:22)
Mm-hmm.Right.
Elizabeth Luna (13:44)
where it makes sense and which contractor I know that their skill sets are fit for that project.Kristen (13:50)
I think that’s a really good point. I’ve actually never heard somebody tear off of their contractors like that. How did you kind of come up with that system?Elizabeth Luna (13:59)
⁓ School of hard knocks. Well, you know, and being in the corporate world for so long, you know, I just kind of learned how to level and silo people wherever it made sense and where to blend them whenever it made sense. Because at the same time, while you’re rehabbing a house, you don’t want to overlap too many contractors at the same time, right? Because people are going to step on each other’s toes and work quality will be compromised.Kristen (14:03)
Yeah.Elizabeth Luna (14:28)
and then the blame game starts, right? It’s always somebody else’s fault. And ⁓ so I’ve just learned by looking at the quality of their work and gauging it against my expectations of what the end project is supposed to look like. And so that’s how I developed my tiering system.Kristen (14:47)
Mm-hmm.I love that. Well, I mean, kind of what you were saying, you’ve seen a lot of, you know, ups and downs in the market and you’ve, you know, gone through your own trials and tribulations. What have you kind of seen through the market in the last 21 years and where do think we are today, especially with, you know, flips and, you know, stuff like that.
Elizabeth Luna (15:51)
Well, ⁓ from a buy and hold perspective, I made it through the 07, 08 market crash unscathed. It was fine. Of course, back then I only had eight.properties at the time. Now we’re up to 35 doors and so it’s been a bit more challenging in the current market to navigate what’s going on because wages are not going up as fast as inflation is. So I have to be very careful and very thoughtful about rent increases. So far I’m keeping them flat ⁓ so as not to run off the people that are currently paying the rent and paying the bills.
Kristen (16:33)
youElizabeth Luna (16:34)
⁓ but I’ve also ⁓ had to pivot ⁓ in filling the vacancies. I previously had a property management company and I had to let them go. ⁓meeting my expectations. And ⁓ so I brought all of those properties back into my management, self-management circle. And so it’s taken me about a year and a half, almost two years to get everything back on track, getting better quality tenants, ⁓ incorporating guerrilla marketing tactics to find ⁓ tenants to fill the vacancies. So where we were at a 67 % vacancy rate, ⁓ now we’re down to
2%. And that’s just the buy and hold side. ⁓ So I’ve also started incorporating short-term and mid-term rental concepts into our portfolio ⁓ to be diversified in the type of client that we are catering to. ⁓
Kristen (17:22)
Yeah.Elizabeth Luna (17:41)
Granted, they usually pay more rent than the average long-term renter, ⁓ but then sometimes they can cause more damage. So you deal with that battle. Now as far as the flipping side of things, ⁓I’ve done a lot of ⁓ residential flipping, some commercial, small commercial flipping. ⁓ And the market right now is very slow in San Antonio, South Texas. The market’s very slow. People are staying put. They don’t want to spend the money. They don’t feel their money can go as far. Now, house values are dropping in our market. ⁓ So they’re kind of like…
level correcting the inflated prices that we’ve had during COVID. So we’re seeing that drop off and that’s, it’s not making sense right now for me to flip at this, at this market moment because sellers are still wanting COVID dollars and prices for their homes and the market’s not there anymore.
Kristen (18:28)
Mm-hmm.Yeah, I know it’s really about kind of adjusting your strategy to where the market is. Can you give us an example of some time or a time where you really needed to pivot in the moment?
Elizabeth Luna (18:59)
Absolutely. So ⁓ a year ago, ⁓ I got a referral lead for a home in a state situation through one of my non-real estate networking groups and got the property under contract and went into that. ⁓rehab with a partner and she was funding the entire project. So she ⁓ wanted to just sell it as a traditional rental. And ⁓ when we started the process, the numbers were looking favorable. But as time dragged on and dealing with ⁓ unvetted contractors that I did not choose, ⁓
it dragged out the rehab process. And during that time, the market value started dropping. And ⁓ as a result, we weren’t getting offers on the property where the numbers needed to be to make sense. So ⁓ the way I ended up pivoting on that property was my partner wanted out.
Kristen (19:59)
Mm-hmm.Yeah.
Elizabeth Luna (20:08)
I bought her out and that home was just screaming. It was screaming that it needed to be a senior care, a senior residential care home. And so ⁓ I started marketing and reaching out to those people in that industry. And sure enough, we got a ⁓ five-year contract. It’s triple net. And so now they are paying all of the taxes, the insurance, the maintenance, the…Kristen (20:19)
Mm-hmm.Elizabeth Luna (20:35)
everything and the base rent. So ⁓ had I not pivoted, I would have lost out on that opportunity from having just a traditional gross rent paying long-term tenant to now having a five-year triple net tenant.Kristen (20:51)
Yeah, I mean, that’s a great example of it kind of being creative with the market as well. ⁓ Well, this has been really, I mean, you have a really great way of how you look at your portfolio and how you adjust and how you build your team. you could, if you, something that you wish you learned earlier in your career that you could share with us today to kind of wrap this up.Elizabeth Luna (21:13)
So something that I wish I would have learned earlier is… ⁓that you can buy properties off market. For the longest time, I kept buying everything off MLS, and I was paying full market value. I didn’t know that I could buy them directly from this seller, that I could buy them from banks and foreclosure lists and word of mouth. ⁓ But now I know. And my home, my current residence, ⁓
Kristen (21:23)
Mm.Yeah.
Elizabeth Luna (21:50)
I was unaware that it was in foreclosure at the time when I bought it. And so if I would have known that back then, I would have asked for a sub two instead of securing a full loan. ⁓ But we have our home. We’re in our forever home. We’re never going to move. So it all worked out in the end. But I think knowledge about the creative ways of acquiring property and getting the financing. ⁓ I was doing it the long hard way of getting bank loans, traditional bank loans, which was easy.easier to do while I had my W-2 job. ⁓ And it got to the point where I had like 10 mortgages under my social and the industry already stopped. Stop, you can’t get any more loans, that’s it. ⁓ And then I learned about ⁓ portfolio loans.
Kristen (22:22)
Yeah.Mmm.
Elizabeth Luna (22:38)
and sowas able to roll everything out and now everything’s under an LLC and multiple LLCs. ⁓ And so we’re mindful about all that now. So those are some of the things that I wish I would have known earlier, but I’m glad I know now, better late than never. So regardless of what age or stage in life that you’re at, you can get started in investing. You can secure the money. You can get the leads. So don’t let the fear stop you.
Kristen (22:47)
Yeah.Hmm? Right.
Yeah, well I think that’s such a great note to end on. I think that that’s really inspirational for people. Tell everyone where to find you and how to connect with you.
Elizabeth Luna (23:13)
Okay, so I’m Elizabeth Luna. My website is heavensentpropertysolutions.com. I’m in San Antonio and I buy properties in San Antonio and South Texas. So if you have any leads, feel free to reach out and let’s see if we can work together.Kristen (23:29)
Amazing. Well, thank you so much for being here, Elizabeth.Elizabeth Luna (23:32)
Thank you for your time.Kristen (23:34)
Thank you everyone for listening. Hope you learned a lot, got some inspiration for your own business. Maybe, you know, look at your systems a little bit differently and we will see you back next time. Bye.
