Stop Timing the Real Estate Market: How Rental Properties Build Wealth

Ronald Moschetta (00:00)
What’s interesting is should I buy real estate today? Are prices too high? Are interest rates too high? I don’t think it’s timing the market. It’s the time you’re in the market. Go back anywhere in history, and I don’t care if you pick the highest price with the worst mortgage, you will see a one hundred percent trend that is in your favor.

Joseph Crooms (01:54)
Hey everyone. Welcome to Investor Fuel Real Estate Pros Podcast.

Ronald Moschetta (01:58)
Pr

Joseph Crooms (02:00)
And I’m your host, Joseph Crooms. Today I’m joined by someone I’ve been looking forward to chatting with. His name is Ronald. I am not going to mess up his last name. So I Ronald, tell us your last name.

Ronald Moschetta (02:12)
Moschetta

Joseph Crooms (02:13)
Moschetta

See, I got it. See, I that was smart of me. I wanted him to announce it, so I won’t get it wrong. So, but Ronald Moschetta and he’s gonna be talking about his transformation into real estate. but we’re gonna dive right into it. So Ronald, say hello to everyone.

Ronald Moschetta (02:30)
Well, greetings all. I guess my my claim to fame is gonna be building wealth for first time homebuyers and renters. I am an investment banker who has converted to the real estate dynamics and I’m looking to show people how they can afford build wealth, and that’s gonna be my focus.

Joseph Crooms (02:53)
We can tell Ronald already got your attention because I know a lot of people have drawn their ears in. Ronald, what got you into real estate?

Ronald Moschetta (03:01)
Well, I was in the financial markets, the let’s say the intangible securities, bonds, notes, etc. And I was basically, due to my weakness, which is compliance, forced to move from the financial markets into what we call real property. And it’s interesting because I can walk around or drive around and what do I see everywhere? Homes, real estate, no matter where I go. there are

There is value. And as they used to tell me, they’re not making any more of it. So land is limited. Populations are growing. Wealth is growing. And therefore, demand versus supply, it’s a good place to be, to build wealth for you and your family. And did you enjoy the live and a lifestyle improvement?

Joseph Crooms (03:50)
How are you going to leverage your knowledge in the financing into your real estate business?

Ronald Moschetta (03:55)
Well, I’m gonna use the same dynamics of creative thinking and strategies. strategies such as using programs or taking a person’s financial profile and massaging it, looking at it, and present it in the best light. I believe that the lenders will lend if they get the documents properly prepared, presented correctly, and you can

You can turn no’s into yeses very quickly.

Joseph Crooms (04:26)
So let’s look at some categories. Say if you got $10,000, and then you got another player that’s got $25,000, then another guy at $50,000. What would that conversation look like with each and every one of them?

Ronald Moschetta (04:40)
Well, you know, the very interesting you say that. I have looked at properties. Now you can real estate is very, very unique. There’s four ways to make money on real estate. One is you buy the real estate, you have a mortgage, you collect your rent, and the rent, if it’s greater than the mortgage, it gives you some cash flow. Believe it or not, that is the least important dynamic. You then have amortization.

What is that? It means every time you pay a monthly payment, you earn more equity back in the house. So you’re building wealth. Now you have a job, you make money, you pay taxes. in real estate, you have tax deductions, your interest expense, you can depreciate these properties. So all of a sudden, money that typically would go to Uncle Sam now stays in your household. So, and of course, the final one is appreciation.

What’s interesting is should I buy real estate today? Are prices too high? Are interest rates too high? I don’t think it’s timing the market. It’s the time you’re in the market. Go back anywhere in history, and I don’t care if you pick the highest price with the worst mortgage, you will see a one hundred percent trend that is in your favor.

Joseph Crooms (05:57)
Ronald, what has

Ronald Moschetta (05:59)
Well.

Joseph Crooms (06:00)
Yeah, no no problem. what is hindering most investors at this present time?

Ronald Moschetta (06:06)
You know, th th I think it’s called analyst paralysis. They’re analyzing things too much. I mean, you look like you’re just about my age. You’re about twenty one, right? Yeah, sure. I was

Joseph Crooms (06:18)
I thought you were

thirteen.

Ronald Moschetta (06:23)
W when we were growing up, what were interest rates? People would say seventeen percent C D rate. I don’t want to lock in, they may go higher. And today you’re looking at six and three quarters and thinking the rates are too high. The reality is that everything is equal. When I was a youngster and I walked down the street and I saw a house for four hundred thousand dollars up from Great Neck and back in the let’s say the late sixties or early seventies.

That’s what the price of a house was. I say, how am I ever going to afford this? You know, I mean, I got nothing. And once you’re in the market, and once you get exposure in the market, it seems that you trade homes for homes. And the next thing you know, your first home is satisfies this criteria, your next home that. All of a sudden you start making money and you can change your home for your dream house or your investment property. And what you’ll find is that

These assets are a slow trend that help build wealth for your family. And that’s that’s really it. Interesting in all my crazy investments. One of the investments that I really was surprised at the value it created was life insurance. And that’s on these whole life policies, not terms. But this little dribble that hung out there was there for

Not only death benefits, it had surrender value, cash value. And I was amazed at in all the crazy things you have because things go up and down. You know, you make a hundred thousand in one investment, you invest twice as much in the next one, and maybe that didn’t work, and you’re back where you started or a little less. So these assets, real estate, life insurance, they work.

Joseph Crooms (08:55)
Ronald, how long have you been in your your your your business adventure of real estate? How long have you been operating?

Ronald Moschetta (09:02)
Interesting because I got my real estate license about say five or six years ago and I got dragged back into investment banking. There was a company that needed help, they reached out, I helped them, I was compensated, then another company came, and again once you’re the the the SEC is a pretty gray area of regulatory interpretations and I’m not a

a paper pusher, I am a visionary and I get the team together to support my efforts. The bottom line is I have basically committed to real estate one year in the making. I’ve helped two short sales so far get done so I saved people from that dreaded bankruptcy category.

We have introduced some people who have made some money purchasing those. I’ve real estate’s a a funny business. I met a a nurse, she’s ready to sell. I sold her house for more than she wanted. She wanted to buy another house, I found her that house, and then her son came in and said, I mom, I don’t want to move. And with that I lost both sales. So I’ve learned sort of even when you

Think you’re at the finish line. You’ve got to punch it over the goal line. And you know, I understand things happen. I hold no ill will towards these people. I’ve shook their hands. that’s what their family wanted. Unfortunately, you you put time and effort in it. Sometimes you do you get nothing in return. And people are afraid of realtors, it seems to me. They think the realtor is going to steal, but realtors, good ones will add value.

I mean I I really don’t understand it, but I guess when I was called a stockbroker, they hated stockbrokers too, ’cause everybody was like, you’re gonna lose all my money or whatever thoughts go with general generalizing a profession.

Joseph Crooms (11:07)
What would you say your book of business is is at now since you’ve been in this business for a year?

Ronald Moschetta (11:12)
Well, I have really been been going towards first time home buyers. I have been showing a house in Greenport, New York. Now Greenport, New York, is the North Fork of Long Island. And if you look at the South Fork and North of Long Island, it’s called the Hamptons. And any property in the Hamptons, everybody knows the Hamptons. It has been explosive. Well if you fold that tail over, Sag Harbor.

On the south, harbor on the north. Beauty on the South, Beauty on the North. What’s the difference between the North Fork and the South Fork? I would say a four-bedroom home goes for three million to four million, and a home and a three-bedroom home goes for under a million. So I believe that this is a value area. There’s only eight hundred, maybe eight ten, eight twenty, single-family homes in Greenport.

The North Fork is being recognized by investors, by people that want a different lifestyle. It’s it’s not discotheques, it’s walking, it’s a laid back, it’s a it’s a maritime. that lifestyle, I I am betting that the North Fork develops into what the South Fork is. So I’m running around saying value, value, and try to catch somebody’s ear.

Joseph Crooms (13:15)
How many houses have you sold since since you’ve been in business?

Ronald Moschetta (13:18)
Well, we’ve sold houses, I’ve sold two of them, but I have listings that w what what is somebody I mean, this is a very tough thing. I meet you, you show me your pride and joy, your home. And I and you say to me, Ron, my home is worth a million five. And I say, Well, I think the home is probably worth a million, but it’s a hot market, interest rates are not that bad.

You can probably get your million two, million three. I’m gonna tell you strategy. Let’s put your house on the market at nine nine nine. Your reaction? Why? And the answer is you will get a bigger audience, and I bet I sell it closer to one point five, where if you put it up at one point five, you’ll probably get no activity. So I have just convinced.

These homeowners that are really looking to get one point two for their property. They were at one point six. I finally got to go nine nine nine. I’ll let you know next week what happened. I think I sell it for one point two this week.

Joseph Crooms (14:22)
So you would say, so you’ve been in business for a year. What would you say your monthly revenue is right now?

Ronald Moschetta (14:29)
Well,

I try to gear it around fifteen to twenty thousand and you know, I believe it in real estate if you’re just a a person, you should make a hundred grand. If you’re aggressive, y you should be two to three. And I’ll I’ll tell you that a little bit of winding it back with some r referrals with some exposure.

I don’t see why you can’t make over a million a year.

Joseph Crooms (15:00)
So Ron, let me ask you this. what has what has your market been like? What’s what’s the market that you’re gonna attack attack first?

Ronald Moschetta (15:09)
Well, here’s what happens to me. So there has been two business people that approached me and they’re looking at themed or destination facilities. And these destination facilities can be to reconnect with your lover, not prostitution or short stays. These are really reconnect luxury villas that can

allow the husband and wife to reconnect. Then there’s another individual that approaches approach me and they’ve got a club mentality. I mean, they’ve made I I always like the little rascals, the He-Man Woman Haters Club. And these are concepts that are taking a facility decking it out with marble and sports TVs and billiards and

You know, whatever other amenities you can put in there for a destination facility. So these are what catch my attention. So do I wanna be a residential seller? Do I wanna be a creative developer? somewhere I will find I’ll end up.

Joseph Crooms (16:21)
Where do you think you will land? What is your n what do you feel is your niche?

Ronald Moschetta (16:26)
You know, I like to help people. So I when I see people that are suffering and and I believe that I have the the accrement, the dedication, and a little bit of knowledge to help them, I like to go there, but I’m equally greedy. I equally want to make money. So I I will tell you that I am going to look at value areas, the North Fork. I really like the North Fork. Believe it or not, Lido Beach, a beach community that

The the West side is the hottest thing in the world and the Lido side is nobody cares about. These are value plays that I hope to introduce to people and hopefully build some momentum and get some investors that will look into what opportunities are out there.

Joseph Crooms (17:13)
Who was it?

Ronald Moschetta (17:13)
Who was who was that just recently? I I saw Amazon’s ex-wife putting lots of funds into programs. would I love to have a conversation with her because if anybody needs help, there are people in shelters that they’re there for what reason? Maybe they are abused.

Maybe they got involved with the wrong person. They need that step to give them the second chance. And it’s not expensive. I figured that for two hundred thousand dollars I could buy a two-family house with twenty percent down, have a mortgage that would allow these people to live for under three thousand, which all these voucher programs pay. The the the the the let’s call it the charity that owned these.

would be able to see the appreciation from wealth building, giving them credibility to get funds from banks and lending institutions. And I’d love to see that. So where am I? How am I going to get this message out? I’m gonna find some something called Investor Fuel that can basically listen to me and hopefully get this message out. And I will promise 110% effort.

To do what I say.

Joseph Crooms (18:37)
Iran, let me ask you this please. You spoke about depreciation and appreciation. How would you define that in to a lay person?

Ronald Moschetta (18:45)
Okay.

Yes. You got a house. Let’s just say it’s for simplicity simplicity. You pay two hundred and sixty thousand dollars for the house. You’re allowed to take ten percent of that value each year and write it off against your income. So let’s say you you got a hundred thousand dollars, you can take ten percent of two hundred and sixty, that’s be two thousand six hundred dollars.

A year you will take that off of your income tax that’s due and keep that money. I hope my man

Joseph Crooms (19:19)
Yeah, and what’s that called? Depreciation?

Ronald Moschetta (19:22)
Depreciation. You depreciate the asset over a the life which the IRS gives you twenty six or twenty-seven years.

Joseph Crooms (19:31)
And

how and and then how does that balance what your appreciation value?

Ronald Moschetta (19:36)
Well, let’s let’s look at this way. So let’s say we we bought a house and we are making a hundred dollars a month above the cost of the mortgage. So you take a hundred dollars and you laid out twenty percent of that money for the house. So you’re getting a hundred dollars under twenty percent you laid out, so you’re getting a rate of return. Somewhere in five to eight percent is what you get in today’s market in general.

So now you go to your job and you get you get your paycheck and it says you made ten thousand dollars and you paid three thousand dollars to Uncle Sam. Well, now you get to deduct those depreciation and the interest on the mortgage, and you get out of that you get that money back from that three thousand. So in your household account, you not

You don’t have seven thousand, now you have eight or eight thousand five hundred. So you have more cash that you’re keeping. And that allows you to invest into other things, to home improvements, to do what you want. And of course, appreciation, we all know, we hope we buy it at a dollar and it goes to two.

Joseph Crooms (20:46)
Thank you for sharing that. thank you for sharing that. So we’re running out of time. What is it from your business that you’re going to bring into the real estate world?

Ronald Moschetta (21:00)
I am going to either help a group start to buy properties, build a portfolio, and build that portfolio to where they can have income for the rest of their lives. Just imagine a a young guy who’s 30 years old today, goes in and gets a house, he works, he pays that mortgage, collects his rent and pays the mortgage.

And at the end of it, he owns the house, and now he gets the rent payment for income for the rest of his life. And if we could put one, two, three, four, just imagine getting 10 properties in your portfolio. And if they each in today’s market paid you $3,000 a month and you have 10 of them, that’s $30,000 a month for you to live on.

Joseph Crooms (21:49)
about if a bank or the financial in industry needs your help?

Ronald Moschetta (21:53)
No, can’t do can’t do it anymore because there’s a little thing called the missus. And she has told me no more investment banking. And y you know what? listen, I’m very excitable. I get to work, had a heart attack in two thousand four. you know, th th this is what I want to do. And believe it or not, I would like to end up with some

real estate holdings that can leave legacy funds for my daughter, my other daughter, my son, their grandkids. everybody wants to leave something. And what would you rather leave? the piece of paper or five pieces of property down in an area? Especially the North Fork.

Joseph Crooms (22:43)
Ronald, so listen, relationships and everything, you pick the right choice, get involved with Investor Fuel. I think you’re gonna love what we all that we’re gonna offer you to further your message. Before we wrap up, if someone wants to reach out to you, connect with you, maybe collaborate or learn more about what you’re doing, what’s the best way to reach out to you?

Ronald Moschetta (23:02)
I think texting and text me to call and I tell people to text text their email address and it’s 516-650-7157 You can call, you can text, I will reply as soon as I see it. And I promise you this, I will the worst you’ll get from me is an education and I don’t look for any you gotta use me.

You can pick my brain and I hope that you’ll see one thing from me, which is I look for relationships, not transactions.

Joseph Crooms (23:40)
Give it to us one more time, Ron.

Ronald Moschetta (23:42)
516-650-7157

Joseph Crooms (23:47)
Thank you so very much. Perfect. Well, I like to well listeners, I appreciate your time, Ronald, for s speaking to our listeners, your story, your perspective, your new philosophy that you’re entering, and also your investment experience. I think you’re gonna do extremely well in this market, and we’re happy that you’re in the space. thanks again for being here, Ronald.

Ronald Moschetta (24:10)
Hey Joseph, you’re a gentleman and if you have any questions, I want you to feel free to call me. again, I like relationships, not transactions.

Joseph Crooms (24:19)
Sounds good.

for those of you tuning in, we got some I know you got some value from this. Make sure you subscribe. We got more conversations coming from operators, just like Ronald,

Moschetta.

We’re out there building real businesses, helping communities, and a desire to help people move from poverty or move from being mediocre to move for generational wealth. We need more people in the industry doing things just like this. So we’re gonna see you at our next episode. But hey, Ronalds, tell people you’ll see him later.

Ronald Moschetta (24:50)
I will I’m here for you and my a pleasure meeting Joseph and if he needs me I will be available for him anytime.

Joseph Crooms (24:59)
Sounds good. Thank you so much for being here at Investor Fuel Real Estate Pros Podcast. And we’ve been on it, we had a great time today with Ronald Moschetta. And we thank you so very much. And we’re going to see you on our next episode. See you later, guys. Okay.

Ronald Moschetta (25:13)
God bless you.