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Show Summary
In this episode of the Real Estate Pros podcast, host Michelle Kesil interviews Jansen Lormand, a CPA and real estate investor from Louisiana. Jansen shares his journey into real estate investing, including his early experiences, the importance of education, and the mistakes he made along the way. He emphasizes the significance of building a reliable team, navigating challenges such as insurance and HOA issues, and his strategies for scaling his business. Jansen also discusses future opportunities in real estate and the importance of customer service in his profession.
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Jansen Lormand (00:00)
I actually pulled up a future value calculator like on Google and ⁓ I was just playing with numbers just to see like, okay, hey, if I make X amount of dollars for 10, 20, 30 years, how much money could I have in my ⁓ investment account if I got just an average rate of return of 8%, okay? And I started doing that and I did that at age like 18. So I quickly saw like, I need to make way more money because my expectations are not where ⁓ reality is at.Michelle Kesil (02:02)
Hey everybody, welcome to the Real Estate Pros podcast. I’m your host, Michelle Kesil. Today I’m joined by someone I’m looking forward to chat with, Jansen Lormand, who is a CPA and real estate investor in Louisiana. So excited to have you here today, Jansen.Jansen Lormand (02:21)
Thanks for having me. ⁓ You want me to give a quick intro on my background.Michelle Kesil (02:26)
Sure, yeah, wecan go ahead and just dive in if you want to share about yourself.
Jansen Lormand (02:31)
Yeah, okay, so I’m 27 years old born and raised in Louisiana Been at the same accounting firm that lies eight years I boughtfirst fourplex at age 22 Then I just recently bought three more fourplexes at age 27. So now I have 16 units right now I have my own little property manager handyman electrician And a lender right now Definitely didn’t do things the best way my first fourplex
I had ⁓ my first property manager stole from me for like the first six months. I learned the hard way I’m still learning all the nuances with insurance and stuff like that ⁓ And yeah, that that’s pretty much pretty much it I came across this podcast. I think it’s amazing. ⁓ I love ⁓ real estate for many reasons and ⁓ Yeah, I want to I want to continue to buy properties because it’s been good to me so far and
Yeah, I’m glad I’m starting now versus later so I can start cash flowing more.
Michelle Kesil (03:41)
Awesome. And how did you get started into investing?Jansen Lormand (03:46)
So how I got started in investing was before I graduated college.I actually pulled up a future value calculator like on Google and ⁓ I was just playing with numbers just to see like, okay, hey, if I make X amount of dollars for 10, 20, 30 years, how much money could I have in my ⁓ investment account if I got just an average rate of return of 8%, okay? And I started doing that and I did that at age like 18. So I quickly saw like, I need to make way more money because my expectations are not where ⁓ reality is at.
And one of the perks of real estate is the cash flow perspective. So what I do with my properties is ⁓ every month that cash flow goes back into my stock portfolio. So now I’m earning more money and it’s compounding at a much faster rate. And then on top of that, I get the future appreciation, assuming I keep up these properties and stuff like that. And then you also get the opportunity to do a cash out refinance ⁓ in the future. with those things, plus the tax strategies,
On doing that I mean in some cases you can get your 20 % down payment back in like one to two years and then everything else after that is it’s gravy
it’s a It’s it’s really a great game, and I wish every young person Would at least understand the rules? Because once you understand the rules you can really ⁓ Build wealth I mean two three times faster versus just working the same job over and
I’m not telling you to quit your job. I love my job, but that is not the only way to to build wealth for you and your family so
Michelle Kesil (06:20)
Yeah, definitely. And when you kind of say like, you have to build wealth in other ways and through real estate, like how did you start and like, I think that’s like the hard part for people is like finding like that first project and just starting like did you do education or like have support? Like how did you just start?Jansen Lormand (06:45)
Yeah, so ⁓ for me…I rarely listen to music. listen to podcasts and podcasts are YouTube videos. I’ve been doing that probably the last seven years and that’s what really motivated me because I got to see all these successful people and I hear about them through podcasts and YouTube and not all of them are 50 years old. Some of them are in their 20s or 30s. So I quickly learned that it’s just knowledge based and then actually acting on that knowledge. Like you don’t have to be like, I’m not rich.
millions of dollars to get into ⁓
Investing you know like I bought my first property age 22. It was The property was worth like a hundred grand, so I only had to put 20 20 grand out I say only but it’s still a lot for at my age, but you don’t need millions of dollars. You don’t need thousands of dollars and You just kind of got a start and and what’s great now in today’s world is dude you can learn so much online for free And that’s what I do like that’s how I learned so much I learned a lot at my job in terms of the
tax implications and stuff like that, but also learn other tax strategies online, you know, through investing and all that other great stuff. Plus, you get to learn from people who have made mistakes over and over again. And don’t get me wrong, I’ve made plenty of mistakes already, but now I know what not to do just from listening to people all for free. So yeah, I don’t listen to music really ever. It’s always podcasts because there’s always something that I can learn. And
and potentially use it in my life and give back to other people, which is what I hope I can do for people today.
Michelle Kesil (08:29)
Absolutely.And as far as like mistakes, what are some of the mistakes that you’ve made? And what have you learned from it?
Jansen Lormand (08:37)
Yeah, so first mistake whenever I bought my first four plex at age 22 ⁓ I went with a property management company that was established in the area I Didn’t think she would be stealing from me, but the first six months I never got any money back and I just started a new job. So I’ve been at the Let me back job. I’ve been at the same accounting firm the last eight years. However, I left for about six months I took a controller job at a construction company and then I moved back to the same CPA firmSo that was the only time I ever left within that six month period I had Transition to that new job, and I also bought this new fourplex so I Will care it a lot more about the new job because that’s what I was doing full-time And I thought because I had a property management company everything would be fine. I’d get monthly cash flow immediately And that was not the case so what she would do is number one She charged 20 % of your gross revenue whether it was collected or not so huge red flag which I
should have known that she has no incentive to go collect rent from any of the tenants ever. She’s gonna get paid a flat 20 % no matter what, which is a terrible model. And number two, she would ⁓ create fake repairs and maintenance stuff. And then basically have her own little repair crew and then she’d also get reimbursed on the back end like that. So she’d get the 20 % fee plus these made up
and she would claim to take pictures on but ⁓
Even then if someone’s doing that for you now Who’s to say that property management company didn’t go mess up that apartment then take the pictures like you really have no Clue on what these property management companies are gonna do for you Unless you’re the one managing or if you have someone that you really really trust and now I’m at the point where I have someone at where I really really trust she doesn’t work for an actual property management company so I can pay her less than the traditional 20 % like most
companies
charge because those employees are those management companies they don’t even get paid the full 20 % the company gets paid the 20 % and then they and then the company dishes out them an hourly wage or annual salary so I can Modeling it out that way you can pay that your your property manager like maybe 10 or 15 percent and you’re gonna get way better quality From your manager plus is gonna cost you less so highly recommend
I can front her after six months and I quickly knew she was still in front of me because she couldn’t answer any of questions. I went to her office, printed out all the receipts, and she got immediately offended and basically tried to kick me out of her office. And I was like, okay, ma’am, I know exactly what’s going on right here. ⁓ It’s over. And so the very next day I terminated the contract. So.
Michelle Kesil (12:08)
Yeah, absolutely those types of things can happen. It’s good to learn from them.And what are some of the main keys that you feel have allowed your business to be able to grow and to run smoothly?
Jansen Lormand (12:25)
my I have, ⁓ as I mentioned, my own property manager who doesn’t work for a company, she just works for me. And then ⁓ I actually picked up a handyman who doesn’t just work for me, but he pretty much does just work for me. He’s very cheap, does great work, trustworthy. ⁓ And then I have an electrician as well. ⁓ And then my own ⁓ banker ⁓ who is apart in investing. ⁓ So he’s got to be able to provide the financing for me quickly and make sure it’s I’m not getting dinged with extra fees and a crazy high interest rate. But with that being said how I came across the handyman and electrician is I just picked up the phone and I contacted every single HOA person from the first fourplex that I invested in until I someone was able to give me a handyman that they trust.
or an electrician that they trust. And it’s been like that the last five years. Just me picking up the phone. It was all for free. And look, the first 20 of them didn’t even answer or didn’t even want to help me. But I just kept going because I figured someone’s going to help me out. And sure enough, someone’s helped me out. And ⁓ that’s really how you make it, especially in low income housing. So that’s what I have. I have 16 apartments. They’re more lower income housing. ⁓ And you can’t just call commercial people.
Because you’ll never make it you know most of them will probably told you $200 just just to go out there before they even fix anything so You got to have that I call it my 18 you got to have a property manager Assuming you’re not going to self-manage it and then a handyman electrician and then a banker slash lender
Michelle Kesil (14:18)
Yeah, amazing that you have that team all set up and you found the right people. I think that can be a challenge.Jansen Lormand (14:26)
Yeah, yeah for sure for sure I’d say that’s probably the one of them. That’s probably the biggest hurdle before you even look at buying properties I make sure you have a team because if you don’t I Mean if anything goes wrong you’re immediately probably not gonna cash flow or it’s all it’s also hard to do a cash flow analysis because you don’t even know what those costs are gonna be so Definitely looking to getting a team before anythingMichelle Kesil (14:46)
Right.Yeah.
What are you most focusing on solving or scaling to next in your business?
Jansen Lormand (14:58)
So right now I am actually about to.Add some value into these three four plexus that I just bought
And then slowly increase the rents because the lady I bought it from she was pretty in my a She didn’t keep keep up the place. So I bought it. I bought these for a pretty good discount ⁓ And she was charging a lot of below market rates, so ⁓ I’m gonna turn that around pretty quickly and Basically, that’s gonna boost up
three fourplex is value okay and so I can either flip them which I’m not really that interested about flipping unless the offers that good but what I’m really interested about is boost up the value and then doing a cash out refinance because they’re already they already appraised for a good amount more than what I bought them for ⁓ but now with with me adding a little bit of value and boosting up the rents ⁓ it should appraise for a lot more now
I’ll plan on doing a cash out refinance probably buying more property with it or using it for other investing purposes, but I Anticipate doing that on buying more apartments ⁓
Michelle Kesil (16:59)
Awesome. And what has been like one of the biggest maybe unexpected hurdles that you found in your investing journey?Jansen Lormand (17:09)
⁓ Insurance I do not know insurance that well. There’s so much stuff to insuranceThat’s another thing you gotta have actually on your A team is a ⁓ good insurance agent that you trust. So ⁓ that should be five people on your A team. ⁓ I’m still learning insurance and HOA stuff. So for example, with these three, four plexes that I just bought, part of the reason why I was able to buy them at a discount is their HOA has been an absolute cluster the last 20 to 30 years. ⁓ And what I mean by that is they have a master insurance policy.
Okay, and it doesn’t even cover everything either so you’re in those hoa fees. It’s it’s per unit per month, okay, and They are outrageously high I’m fine with paying insurance for an hoa if it covers everything okay, even though you know I might still be overpaying a little bit But if I have to still go get insurance on the back end to cover everything else I don’t want insurance in in any type of hoa and that’s how most hoa
Anyway, they typically don’t provide insurance policies well this one does and it scares a lot of investors in the area because those fees are so high it’s so hard to cash flow and ⁓ As I was doing it in my due diligence period I was backed out of the deal But then ⁓ I called the current manager slash president of the HOA and he’s new he’s been there Almost a year and a half and he is an investor in there He owns about 40 properties in there and he started to turn a HOA around
He actually tried to sue them because of what they had been doing for years Forcing people to not even have their own property management company, which according to him he was saying that was illegal I don’t know all the the rules and regulations on that ⁓ Because it’s not like that now I obviously have my own property manager and she’s she’s running the show for me but they would do that kind of stuff and force owners to Pay these HOA fees to cover the insurance that wouldn’t even cover everything on these properties and so
I met with the HOA president a few weeks ago before I bought the property and I was like, look dude, I know we’re paying way too much in insurance. Let me bring you my insurance agent and we’ll have a special HOA insurance meeting and we will all vote on this. All we need is a 10 % vote at that meeting that day and we will basically vote to change the HOA bylaws and get rid of the HOA.
having
to provide any type of insurance going forward and that will save people I mean including myself thousands of dollars every year so that meeting should take place within it’s in February it’s like the last week in February so pretty much a month a month out and I will be attending and I’m actually probably gonna bring my insurance agent and probably get him a bunch of clients there because a lot of these people they don’t even know I feel bad like some of them were telling the president man they’re like I don’t know if we’ll really
Make that much of a difference and I’m like guys. It’s gonna make a huge difference I looked at the the co eyes and ⁓ I looked at the current co eyes for the HOA insurance policy and I talked to the president and they were just what they were doing is they were beat boosting up the replacement costs of these buildings massively all on these policies to where the insurance was so freaking high and it weren’t even fully covered
So ⁓ now this place is going to be a great place for investing and I’m pretty excited about it. That’s been the biggest hurdle ⁓ I’d say.
Michelle Kesil (20:59)
Definitely.Yeah. And as you want to grow and scale your business, what kind of opportunities are you looking for?
Jansen Lormand (21:09)
⁓ Scaling opportunities, ⁓ always looking for more apartments specifically in Louisiana ⁓ just because that’s where my property manager is at. It’s just a little bit easier. ⁓Yeah, I’m more of an apartment guy just because that that’s just been my experience and I’ve had good success with doing that ⁓ And it’s also low income I actually have a section 8 tenant actually coming in ⁓ Within the next week or two ⁓ They have to get an inspection done. I’m sure as you know, but these apartments are in good shape so the inspection should go clean and I should have a section 8 tenant in there and I’m gonna try to get get get more of those, know, and also they have
⁓
Employers in our area will actually pay for some of their employees rents for up to a certain amount or up to a certain amount of months which is a big deal and I I love those, know because it takes one one bad thing for For for someone to kind of go in the hole and it’s sad, you know that it’s like that and so ⁓ Yeah, that that’s more the opportunities. I’m looking for right now until I get my
my down payment back I’m gonna get a good amount of that back through ⁓ tax a taxing strategy via cost segregation study ⁓ and then hopefully I’ll be able to cash flow ⁓ pretty quickly and get my money back to where I can go buy more ⁓ apartments and then do a cash out refinance as I mentioned in the future
Michelle Kesil (22:46)
Awesome, that’s exciting.Jansen Lormand (22:49)
Thank you.Michelle Kesil (22:51)
So before we wrap up here, if somebody wants to reach out, connect, learn more about what you’re up to, where can people find you and connect with you.Jansen Lormand (23:00)
So they can find me at my business email. It’s [email protected]. That’s jlormand. ⁓ I am on Instagram. am on Facebook. I really just shop around on on media. I don’t really post stuff. I’m kind of in my own world. I’d rather just use Facebook marketplace versus posting because you can find a lot of deals on there as well as Instagram now too. ⁓ So yeah, I don’t really postmuch. ⁓ How I meet people and how I get referrals it’s all in person now ⁓ or zoom you know all that kind of stuff. People like being able to pick up the phone and talk to somebody like I understand that AI you know and technology allows you to reach more people but there’s still a vast vast population of people that want to be able to pick up the phone and talk to somebody immediately and that that’s kind of how I do it. I don’t really have to advertise I keep my phone
on me at all times. I’ve answered the phone at 9, 930, you know, at night in bed helping and answering client questions for tax returns or investing stuff. That’s just kind of how I like to do it. I don’t have to market that way. It allows me to get my name out there. And it goes a long way of answering those phone calls and also not even charging for them. You know, I talked to other CPAs and they always want to bill everything
second of your time but we already charge premiums you know at our firm we’re a pretty big firm in the area and so providing that customer service goes a very long way so anyway ⁓ I’m ranting now so I’ll stop
Michelle Kesil (24:54)
Yeah,amazing. Perfect. Thank you for sharing and yeah, appreciate your story and your time. Thank you for coming on here.
Jansen Lormand (25:02)
Thank you. Thank you.Michelle Kesil (25:04)
Awesome. And for the listeners tuning in, if you got value, make sure you have subscribed. We’ve got more conversations with operators like Jansen who are building real business and we’ll see you on the next episode.
