Subscribe via:
Show Summary
In this episode of the Investor Fuel Podcast, host Olivia speaks with Deandra McDonald, a successful real estate investor in Virginia. Deandra shares her journey in real estate, focusing on scaling her investments through private financing, the challenges she has faced, and the lessons learned from her early investments. She discusses her personal goals, including a desire to buy a brownstone in Harlem, and emphasizes the importance of building relationships and networking in the industry. Deandra also offers valuable advice for aspiring investors, highlighting the need for action and self-conviction in the investment process.
Resources and Links from this show:
-
Listen to the Audio Version of this Episode
Investor Fuel Show Transcript:
Deandra McDonald (00:00)
If there was one more thing I would add, I think podcasts like these are fantastic in order to keep your mind sharp.But you still have to do something. You still have to make moves. You still have to check your budget and apply for your financing and analyze the properties and tour the units and experiment with different rent payment processing forms. Like you still have to do the work. I…
have seen a number of students or prospective investors who truly believe that the situation will convince them to invest. And that is not the case. You have to convince yourself to invest and then find a situation that works. But the deal is never going to be so great that it snaps you out of your own fear. It just it just won’t be. So please use these to keep your mind sharp. But understand movement is still required of you.
Olivia Gastineau (02:28)
Hi everyone and welcome to Investor Fuel Podcast. I’m Olivia. I’ll be your host and today I’m joined by someone I’ve been looking forward to chatting with. Her name is Deandra McDonald. She’s been making some serious moves in the real estate investing industry in Virginia. We’re glad to have you here Deandra. I think our listeners are really going to take something away from you today. ⁓Deandra McDonald (02:38)
Yes.Yes, yes.
Thank you so much!
Olivia Gastineau (02:56)
about how you’ve been approaching your investing and building your game ⁓ up and your goals for 2026. So let’s just go ahead and dive in.Deandra McDonald (03:02)
Hmm.Okay,
perfect, thank you so much.
Olivia Gastineau (03:10)
So first off, for people who may not be familiar with your world, would you mind just sharing a short version? What’s your main focus these days?Deandra McDonald (03:20)
⁓ greatquestion. So right now my main focus is how do I best scale using private financing? It is not what I would have said three years ago or five years ago. But right now I have a lot of private lenders who want to put their money to work.
and not enough properties that I feel would be low enough risk to trust with their investments. So that is what I’m focused on right now.
Olivia Gastineau (03:48)
⁓ What kind of markets are you operating in?Deandra McDonald (03:53)
I am in Virginia and I love a…10 to 20 unit multifamily. I feel like it’s big enough that it can support its own staff, but small enough that I’m not overwhelmed. When I go to tour 100 unit buildings, it just feels like so much. The systems feel also foreign. ⁓ The staffing requirements feel so excessive where a bunch of 10 or 20s feel like the next step up, but not too much that it would sink. ⁓
my overall staff. So that’s what I’m focused on. I don’t particularly care how we rent them, if they’re long term, midterm, short term, as long as they are making enough to cover all costs and profits and returns. Yeah, and that’s what I’d be focusing on right now.
Olivia Gastineau (04:42)
I love it. ⁓ I think what caught my attention about you was the way you’ve been able to just multitask. You’re kind of everywhere right now. And I’m sure that’s not easy, especially in this climate. So what’s been keeping that machine running smoothly?Deandra McDonald (04:50)
Haha.my assistant. ⁓
When I decided I wanted to expand because of what you said, I’m terrible at multitasking. It is really a huge issue of mine. And so anytime I get an opportunity past what I’m currently doing, it feels like some a ball gets dropped somewhere. And I
have had that happen enough that I said, not this time. Something’s gotta give, I have to do better. And not just for my real estate investments. I’m quick to hire a handyman, a contractor, a property management company. Those felt.
natural, expected. But with social media and coaching and membership, it didn’t feel as natural to hire staff to help because at some point I could do it all by myself, right? When there were 10 people in the community and I wasn’t offering as many classes and I didn’t have as many followers. But as that has grown, as the demand for my time, the demand of my job has grown, I knew I had to hire help. So shifted or delegated a lot of the real estate management work.
but also hiring a social media assistant, a director of content honestly, has taken so much of that brain work off of my plate so I could focus on the things I’m good at and give the rest to him.
Olivia Gastineau (07:03)
Yeah, we’ll definitely at the end make sure that everyone knows how to get in contact with you, all your social media. Yeah, absolutely. Now I’m sure there’s a moment where things have gotten super real. Maybe a that went sideways or time that you had to pivot really fast. Would you mind sharing one of those moments for you?Deandra McDonald (07:09)
Thank you!Two come to mind. The first was my very first motel conversion. I bought a motel. I was looking for multifamily properties, right? Looking in that 10 to 20 range and I had a low budget, high expectations and I couldn’t find anything, surprise, surprise, until I found this old motel for sale.
And I bought it and we converted the units into tiny little studios that ran for like three, $400. But this was my first property on a septic tank. I never had a property on a septic tank before. And I was told when I first bought the property that they were flushing the septic maybe twice a year, once every eight months, right? So twice a year, maybe. ⁓
three times every two years. So that’s what I budgeted for. That’s what I planned for. And for the first six months that worked. And then March of 2020 came and everyone went from going to work to staying at home.
And I did not adjust for the fact that that septic tank would fill a lot faster than my eight to nine months. I want to say I got it pumped that like January, February. So in my mind, I’m not thinking about this again until the fall, right? Because that’s the timeline it’s been on since I’ve owned it. And I remember going to sleep one night, maybe in May.
and getting frantic phone calls from my tenants of like, can’t flush, my house smells terrible, what’s going on? And I put two and two together in the middle of the night that the septic tank was full. And half the time, a third of the time it used to take because everyone was at home. So when people before were using the bathroom at work,
when they weren’t showering just because they were bored, right? Or you’re working at home, so you’re showering at home. You’re showering at the gym usually, or using the bathroom at work, or you’re eating at work when all the dishes are being done at home, you’re showering multiple times a day, and using the bathroom. It filled, and there was nothing I could do. And it was my fault. And that’s the worst of the scenarios. It’s three o’clock in the morning, no one is open.
And I just have to, there’s nothing, there is nothing. And I sent a text at three o’clock in the morning to all of the tenants at six a.m. or seven a.m. I started frantically calling anyone who would come. I don’t care what the price is. And my usual guy, my usual septic guy that I love, he doesn’t do emergency calls, right? But he’s like, that’s not my life. I like to book everything out in advance. You should let me know. And so I paid like quadruple my usual price. Got it taken care of in like 24 hours, but.
It sucked. It sucked because it was my fault. It sucked because I couldn’t fix it. ⁓ And even Olivia like offering to the tenants, I’ll get you guys hotels. Go somewhere else for the night. My bad, because you can’t flush, right? I’m not even saying like you can’t take a shower. I’m saying you can’t even flush the toilet because the septic is full. They couldn’t get to the hotels. Some of them didn’t have cars. Right?
Some of them had animals, some of them had families and it just, it just sucked. And it was a mistake that I had to learn of you have to be way more proactive. You can’t just figure stuff out when it affects your tenants like this. ⁓ And my second story is I was flipping out of state and I really wanted it to work where I didn’t have to go.
I really wanted to trust my realtor and trust my contractor. And I showed up to one of the properties I had bought based on the pictures they sent and the inspection they sent. And I learned that I had, I don’t want to say I’ve been scammed as in the property didn’t exist, but it was not at all like they showed me. They only showed me bits and pieces of that property. And when I got there, one of the roofs totally caved in. And that was not in any of the pictures I was, cause I would never have bought a property like that. Right? That’s not my type of flip. And
I had to eat it because again, it was my fault. I was so desperate to have a system where I could just be the financial provider. I didn’t have to also make the decision on the interior design and the exact property. Like, hey, as the realtor and the property manager, the project manager, you got it all. You got it. I’ll make sure bills are paid, but you handle it. And they let me down in that case. But again, my fault.
Olivia Gastineau (11:37)
big risks, a lot to take on.Deandra McDonald (11:39)
Yeah, yeah,for sure.
Olivia Gastineau (11:41)
many years have you been doing this type of work?Deandra McDonald (12:18)
Ooh, I bought my first property in May of 2015. So this year will be 11 years. I was talking to my husband about this maybe earlier today, earlier this week of I’m a third of the way through a mortgage, which is so weird to say, you know, like a 30 year mortgage. I’m more than a third of the way done. But it’ll be 11 years this May that I started investing.Olivia Gastineau (12:43)
Awesome, congratulations. bet it feels good. What made you decide to get into real estate investing?Deandra McDonald (12:44)
Thank you.I got into investing because I couldn’t afford to live. I graduated college with a lot of debt, student loans, car notes, credit cards, and not a fantastic transcript. So I didn’t get, because I worked all through college, right? Trying to minimize my student loans or just kind of get through the experience, I guess. And I didn’t get job offers right away. So I’m piecing together these part-time jobs. I’m still trying to apply to other jobs and
trying to apply to a full-time job while in a bunch of part-time is difficult because you can’t even take off. There’s no PTO. You can’t even say, you know what, I will schedule it on Friday. I’ll take off from my regular job. It’ll be fantastic.
And so I struggled a lot right out of college. And I remember thinking, this can’t be life. know, this can’t be the I can’t do another 40 years of this because I’m barely scraping by and I don’t have anything. I don’t have anything. I don’t have kids. I don’t have retirement savings. I don’t travel. I shop at Goodwill. I, there’s…
I’m at the bottom of what I could expect to continue to do and I’m still barely making that. So real estate felt like, okay, okay, at minimum I can live for cheaper than I’m renting. If I can just get a house for less than I’m paying in rent, I’ll win that way. Then I thought, okay, well, if I can get a roommate in that house, then that gives me some extra money.
And then I thought if I can just stay in that one house for 10 or 15 years, even if I had to wait 10 years, when I sell it, I can then pay all the stuff off. I’ll be back to square one where I have to like start again, but at least the car will be paid off and I can pay off my student loans. And if I have any credit card debt and maybe things are not good at 23, but at 33, things should be okay. Even from this one house. That was the whole reason I started with the first property was just, it’s not good today.
But I don’t really see a job making this any better because I can’t get it. But appreciation doesn’t require anything of me but to wait. So that was the goal when I turned 23 was just to get in somewhere that I can lower my cost of living and hold on to it long enough that the equity will be worth the investment.
Olivia Gastineau (15:01)
Thank you for sharing. How inspiring. Do you still have this particular property? ⁓ that’s awesome. Very fun. What’s the next real big goal for you?Deandra McDonald (15:03)
Yeah.I do! Yeah! Yes!
So I professional personal like a personal is I’m originally from New York and my whole family’s still there and I want to buy a brownstone back in Harlem where I’m from I We always joke that we missed the window when those Harlem brownstones were super duper cheap and we did But that does not mean there aren’t so properties available. That does not mean there aren’t still
opportunities and especially as I think of my parents aging, wanting to have them in one spot. And if I decide to have kids wanting to be able to bring them to the spot, their parent grandparents live right, like just we can do summers in the Brownstone. And that has been really fun to start exploring because that is purely desire that is or it’s an investment for personal reasons, not financial. Like financially, I shouldn’t.
because it’s got to cost money without making a return. Professionally, I think I’m ready. I told you earlier that those hundred unit properties scare me and they do. They still do. I’m not ready to go that big. But I’ve been in that 10 to 20 range for a couple of years now and I think I’m ready to go a little larger. think I’m.
I think I’m okay with the 20 to 40 range, especially with private financing, hiring full-time staff to take care of those properties. I am looking forward to what that could look like in the next year or so.
Olivia Gastineau (17:24)
⁓ What a very beautiful vision you have to spend your summers with your, you know, if you do decide to have children, taking them back to their grandparents’ house, and I can imagine that would just fill you up, right? Like, to reach that goal. So, supporting that vision for you.Deandra McDonald (17:28)
⁓Yes.
Yeah, absolutely. ⁓
Thank you. Thank you
so much.
Olivia Gastineau (17:46)
All right, so now I know a lot of people are listening. They’re either in their journey or looking to level up. I think they’d really benefit from hearing all of this. You’re inspiring me for sure. When it comes to building relationships and growing your network, what’s made the biggest difference for you?Deandra McDonald (18:07)
⁓That is a fantastic question. I think one of the big differences was opening my mouth and saying what I wanted to whoever would listen. ⁓ I think people can’t know what will help when they don’t know there’s even a problem, right? ⁓ I remember saying I want it more female investor friends. I remember saying I want it more.
female investor friends who are doing it on their own. Like not even like a partner dynamic because that’s not the dynamic I was in. And not in an exclusionary way, but just like, hey, this is not a, well, he handles this and I handle that. We don’t do this together. So married or not, you’re doing it kind of by yourself and that will be really helpful. I remember saying I wanted more black investor friends. I think there is a ability to…
prepare or relate or discuss of like, hey, is it uncomfortable walking in some of these spaces? Hey, can you give me some maybe clarity of what rooms you felt more comfortable in or not in and why and what can I do? Wanting more people in Virginia because our market is very different than Tennessee or the New York or Texas or California or Arkansas, right? Like everything can be specified. Everything can be.
helpful if you’re clear and vocal about it. But the second big thing to expand the network is you got to show up and understand that.
Your effort matters. I think some people genuinely think, and I’ve been talking to my membership about this, when they think about expanding that network, especially as newbies, people wanting to scale, and joining meetups and the conferences, it’s always, there’s a lot of emphasis on how it benefits you and how you leave that space more filled up or ⁓ more motivated or inspired, but you’re not thinking about how you can help this space.
You’re not thinking about what stories you can bring or if it’s ⁓ food or a space that you could offer. If it’s perspective, if it’s listening, if it’s doing the reading for the week, like all of those things add to the depth of the experience. But I don’t always think people consider what they need to sacrifice in order to be in the room. If it’s your time, if it’s your thought process, if it’s your planning ability, if it’s your stories, what do you want to give? Not just what do you want to get?
Olivia Gastineau (20:24)
Yeah, really good point. Just life in general, right? I think when we get to that point, that sweet spot where we genuinely feel that we need to, that we like to give, ⁓ that’s where the magic happens, yeah?Deandra McDonald (20:28)
Yeah.Yes, yes,
yes.
Olivia Gastineau (20:43)
Alright, before we wrap up, ⁓ I just wanted to let everyone know how people can connect with you. ⁓ Who knows, maybe someone wants to collaborate, maybe they’ve just found you truly inspiring and you can grow your network this way.Deandra McDonald (20:53)
Yeah.Absolutely. ⁓
So if you look on social media, I have my two biggest platforms, Instagram and TikTok. I love to make little ⁓ informational videos. We’re growing the YouTube to make more long form content. But if you search my name, Deandra McDonald or simple real estate, either one, my handles will pop up. It’ll look like me. They’re verified. So, you know, it’s it’s me. So no worries about that. And I’ve just actually wrote my first book. So if you’re thinking about picking up a copy, it’s called The Multifamily Advantage.
⁓ as to why multifamily investing is what I choose for me and my communities in order to scale investing, please feel free to pick up a copy. And from there, if you want to get in contact more, my email and everything is listed on my website, deandrumcdonald.com, where you can submit info, questions, or submissions so we can work together maybe in the future.
Olivia Gastineau (21:55)
That’s awesome, congratulations on your book. Earlier you had mentioned that you’re teaching classes, is that something you’re still doing?Deandra McDonald (21:58)
Thank you so much.Sometimes,
as we talked, ⁓ or as I mentioned earlier, desire for my time or need for my time has increased, a lot of the one-off teachings have gone down. So I have a membership that I work with people directly for like a year. ⁓ That is probably where I teach the most instead of doing a one-off class because just time-wise, I can’t fit into the schedule as much as I used to be able to.
Olivia Gastineau (22:31)
Awesome, is there anything else that we may have missed that you wanted to add?Deandra McDonald (22:35)
If there was one more thing I would add, I think podcasts like these are fantastic in order to keep your mind sharp.But you still have to do something. You still have to make moves. You still have to check your budget and apply for your financing and analyze the properties and tour the units and experiment with different rent payment processing forms. Like you still have to do the work. I…
have seen a number of students or prospective investors who truly believe that the situation will convince them to invest. And that is not the case. You have to convince yourself to invest and then find a situation that works. But the deal is never going to be so great that it snaps you out of your own fear. It just it just won’t be. So please use these to keep your mind sharp. But understand movement is still required of you.
Olivia Gastineau (23:32)
sense. Yeah, getting over that fear. Big leap of faiths, right? All right. Well, I appreciate your time. Thank you so much for sharing everything you’re truly inspiring.Deandra McDonald (23:36)
Yes, yes.Absolutely, thank you for the invite.
Olivia Gastineau (23:47)
We’re happy to have you here. And those, for those of you tuning in, if you got value from this, make sure you’re subscribed. We’ve got more conversations coming from operators just like Deandra, who are out there building real businesses. And we’ll see you on the next episode.
