The Hidden Secrets: How Real Estate Investing Has Evolved Over Time

Brett McCollum (00:00.818)
All right guys, welcome back to the show. I am your host Brett McCullum and I’m here today with Peter Skobic. And today we’re going to be talking about the evolution of real estate investing. Guys, before we get into it, at Investor Fuel, we help real estate investors, service providers, and real estate entrepreneurs to 5X their businesses to allow them to build the businesses they’ve always wanted and allow them to live the lives they’ve always dreamed of. Without further ado, Peter, how are you, man?

Peter Skobic (00:28.002)
Brett, happy to be here. Doing great.

Brett McCollum (00:29.876)
Dude, I am tremendously excited. Got to know you a little bit pre-show. Talk to you to know some of your history, of background, where you’re going, that sort of thing. And guys, I say this a lot, and I’m not even sorry. You guys are in for a treat on the show. Peter’s wonderful and really looking forward to talking with you,

Peter Skobic (00:49.326)
All right, same here. Let’s do it.

Brett McCollum (00:51.112)
Let’s do it. All right, before we get too far into the weeds on talking everything, give us some background, like who are you? How’d you start? Like give us some history, man. Who’s Peter Skobik?

Peter Skobic (01:02.062)
Yeah, well, I came from Zagreb, Croatia originally. So former Yugoslavia, I came to the US in 2000 and kind of had the dream that, know, thousands had before me coming to the US and trying to build something. So I went to my undergraduate degree in the US, my master’s degree, MBA with a focus on finance. I really thought I was going to do something in finance and ended up funny enough in the grocery industry.

For 15 years, I was a director of purchasing for a national grocery chain. And it’s funny because that kind of ended up propelling me into my real estate career, even though it’s completely unrelated, but it provided kind of the backing for what got me into real estate eventually.

Brett McCollum (01:51.392)
Wow. man, that’s interesting. 15 years though, huh? When you were doing that at the time, did you ever, know, mean, obviously it was a 15 year career. So at some point, you’re in the middle of that, let’s say it’s year eight. Was that career path, the corporate path, like the path that you thought it was gonna be forever? Or were you always thinking, this is a means to an end?

Peter Skobic (02:20.992)
It was, you know, initially, I think when I first started, yes, it was, it was supposed to be my career. I was supposed to retire in it. And that was, that was what I was dreaming of. then by the time that, cause I started as a district manager and by the time that I became a director of purchasing, I already knew in my head that this was not going to be a permanent thing for me. It’s going to be a few years. It’s going to be a means to an end. And really, you know, I remember one time I was with my colleagues at lunch and just a few, you know, directors sitting at a table talking about.

different things and somebody mentioned promotions to vice president. And that was kind of the dream that everybody had, you know, to be promoted to a vice president. And I remember saying at lunch, I said, I don’t really have a goal of being a vice president. And everybody at the table laughed and I, it took me a couple of seconds to figure out why they’re laughing. And it was because they couldn’t just conceive of the fact that somebody wouldn’t want to be a vice president. And in my mind, what it meant was instead of on Monday morning, you know, waking up,

shower, shave, put on a suit and go to work, I would once again shower, shave, put on a suit and go to work. Except now my limitation on how much I can make would be a little bit increased by whoever my boss is. And I just did not find that attractive. Not because I don’t like working, but because I just didn’t like working on building someone else’s company as opposed to mine.

Brett McCollum (03:42.784)
Wow, yeah, mean, and that’s a, I think a lot of us that came out of the corporate sector, know, you may have been taught that your whole life, like that’s kind of what the school system today does. It teaches you how to become an employee, you know, and what do you think it was that maybe opened your eyes into? Because I mean, it’s kind of like the matrix, right? Like where you can’t see it until you see it.

What was it that opened your eyes at that point? Is there any one thing you can point back to? is it several things?

Peter Skobic (04:17.25)
Yeah, I mean, there was no, there just was no time that was downtime. You know, I’d be at work for, you know, 10 hours a day or something. I would come home, but there was really no downtime because I was always thinking about it. There was always something that could go wrong and stores were open for very long hours. And the most stressful times were around the holidays because you had to kind of prepare for Christmas and Thanksgiving, all these different holidays. And again, look, great company, great people I work with. The problem was

I just did not want to miss that time with my family. I wanted to be able to have more flexibility in what I can do in my downtime. wanted to be able to enjoy, you if I take a vacation, I wanted to be able to have it off my mind. And most of all, if I make a mistake, I don’t want to have to explain it to someone. It’s my mistake. just go, hey, all right, learn from it, moving on.

Brett McCollum (05:08.682)
Yeah. And so you mentioned family, married, kids.

Peter Skobic (05:12.81)
Yeah, I’m married. I have a wife and I have one daughter who’s five years old.

Brett McCollum (05:19.488)
Oh man, that’s the, I’ll be honest with that’s my favorite age. I have a, my daughter just turned six last week. It’s my favorite age, man. They’re just so, right now anyway, she’s all about, she loves her daddy and loves to hang out. That’s like, hey, you can be having, in the entrepreneurial world, really high highs, really low lows, if you’re having a bad day.

Peter Skobic (05:26.39)
I just want to keep it at five. Yeah.

Brett McCollum (05:49.972)
and your daughter comes up to you and just cuddles right up, like it doesn’t matter anymore, like that’s the best.

Peter Skobic (05:52.59)
Yeah. Oh, it’s everything. And today’s Friday after we’re done recording this, I’m taking her to the pool. I don’t have to worry about a W2. So that’s everything.

Brett McCollum (06:03.026)
Yeah, well man you mentioned too and you didn’t tell me this pre-show Peter, you’re an immigrant.

Peter Skobic (06:10.378)
yes.

Brett McCollum (06:11.776)
Yeah, that is in the year. So it’s 2000. How old, excuse me, how old were you when you came to the States?

Peter Skobic (06:19.84)
I was 17 when I came.

Brett McCollum (06:21.833)
Okay.

Was that scary? Because I mean, like, what like, what was that like?

Peter Skobic (06:29.272)
Well, in Croatia in the early 1990s, we went through a war. And so it was a dream for a long time to come to the US and build something. So for me, it was everything. I did not look back. I I wanted to do it more than anything. So a little bit scary, but I was more scared of, guess, staying behind and not getting that opportunity.

Brett McCollum (06:34.068)
Mm-hmm.

Brett McCollum (06:53.012)
Yeah, that’s our, I think I know where you’re go with this one, but I did wanna ask this question. So a lot of people that I know, entrepreneurs, and in general in life that are immigrants, that are successful, let’s say that, what do you think that drive is? Because I think there’s a one-to-one, immigrants to American born citizens.

think there’s an extra drive that I’ve noticed anyway. Do you identify with that at all? What are your thoughts there?

Peter Skobic (07:31.886)
Statistically four times more likely to become a millionaire, which I found very interesting. I think it’s, I think it just has to do with, you know, where you come from, how hard it was to succeed in that place. It has to do with just hardship, I think. And then being in a situation where you can just put in a lot of work and get whatever you want. You know, that’s…

That’s really amazing and look, 170 countries have freedom, but when it comes to business, just the ease of doing business and succeeding, that part I feel like United States is uniquely positioned for.

Brett McCollum (08:15.04)
Man, that’s, yeah, I’ve always, mean, I haven’t really ever gotten to ask that question on a show yet. And it’s something I’ve been, you know, I’ve thought considerably about, of like, why in the world, me personally, I’ve grown up in the United States, you know, I’ve lived here my whole life. And, you know, I see immigrants, I almost wonder, is it a level of, not to like boast in some sort of negative way, but like,

positively boast like I United States objectively is it’s a it’s it’s a great it’s the greatest we can say it’s the greatest country because of opportunity do you think it’s that maybe it’s that level of gratefulness of like I’m here now and I and I want to prove that in some way like that I’m great like or is it more just a like you said you mentioned hardship also or is that a combination like

Peter Skobic (09:07.342)
Yeah, it’s a combination of things. mean, when you grow up here, you kind of take some things for granted, right? When you come from outside and you realize, wait a minute, if I do this, then I can do that. And if I put in this much work that I can get this, you know, it becomes very exciting and it’s kind of the motivating factor. And for a lot of us, know, sending money back home is also a motivating factor. So I feel like that did contribute to it a lot. There’s, you know, on the flip side for another podcast, but it comes at a cost as well.

Brett McCollum (09:12.062)
Absolutely.

Brett McCollum (09:28.169)
yeah.

Peter Skobic (09:36.95)
I feel like there’s a trade-off between lifestyle and making money.

Brett McCollum (09:42.016)
sure. Yeah, I mean, that’s super. Yeah, that would be for another time. But yeah, that’s a I’m sure that would be a great conversation to kind of moving a little bit forward here. So you told me a little bit pre show before as you’re kind of on this journey of getting towards real estate, you had some travel time and an RV. Is that right?

Peter Skobic (10:03.598)
Yeah, that’s correct. So I put 15 years into a corporate job, like I mentioned, and in January of 2021, I ended up leaving that job and decided to focus 100 % on real estate. A few years prior to that, I started buying some rentals in Georgia and started with one house in 2015, bought another house a couple of months later, and then bought some three more houses and a few duplexes.

Brett McCollum (10:21.364)
Okay.

Peter Skobic (10:32.61)
over the years and decided to just leave my job in January of 2021. Now, to be clear, my rentals were not enough at that point to sustain our lifestyle, so I decided to get into wholesaling. We did buy an RV around that time. We realized that our daughter was a year and a half old. It was the last chance that we had to kind of travel freely before she starts going to school. And so we did spend several months driving around the country. We left California and…

drove through all the different states to come down to Texas and then from Texas all the way up to New York as we decided to end up living in upstate New York because my wife had family up here. We wanted our daughter to have grandparents so we came up to upstate New York and that’s where I got into wholesaling and managed to get some deals under contract. I did a lot of cold calling at the time and after I got my first deal under contract I was just unable to find a buyer.

I knew it was a great deal, so that’s how I got into flipping.

Brett McCollum (11:34.72)
Wow, it’s almost, I mean, I’m not in the, it’s almost like a backwards journey, right? you kind of, because you see a lot of people wholesale and then they flip for a minute and then they’re like, oh, and then they’ll buy and hold. You know, like that’s kind of the typical evolution almost of the, what, so you mentioned, so you started buying these rental properties, okay, in Georgia.

actually, I mean, you’ve got a number of, you know, doors pretty quickly in hindsight, like when you look at it, it’s like, wow, that was pretty cool. what had you focused instead of buying more rentals and, and say, you know, all right, let’s wholesale. What happened? What was that? Like, what kind of happened there? Was it more active cash flow? Was it more active cash that you’re like? Yeah.

Peter Skobic (12:22.742)
yeah. Yeah, it’s a great question. It’s a good point that you made. I did build up a portfolio of properties over the years and, you know, I’ve listened to enough podcasts to know that I get annoyed if I’m listening to a podcast and somebody says, you know, yeah, so I just, you know, bought 40 houses and now I, know, quit my job and everything is great. And I always think about, okay, did you win the lottery? Like, how did this happen? I don’t understand what happened there. So.

Brett McCollum (12:45.384)
Yeah. Yeah. That’s not real life. Yeah.

Peter Skobic (12:50.658)
For me, the beginning was one, I did work in corporate America for 15 years, so was able to save up some money there. But the real catalyst was we bought a house, we bought a place in California, had it for a few years, it appreciated a little bit, so we ended up getting a home equity line of credit, a HELOC. It’s a great tool, very low rates, and you kind of, use it when you want to. And we bought our first few properties with that.

Brett McCollum (13:20.169)
Okay.

Peter Skobic (13:20.526)
To be clear, in 2015-16, I mean, the prices were not where they are today around Atlanta, Georgia. So that was kind of an easy way to build up a few doors. And then over the years, every time we had any extra money for a down payment, we’d buy more. And then when we got into, when I left my corporate job, we didn’t really have a choice. We kind of had to find sources of income that were more immediate than just a couple hundred dollars per door that our rentals were bringing in.

Brett McCollum (13:35.872)
That’s perfect, yeah.

Brett McCollum (13:49.459)
Right.

Peter Skobic (13:50.528)
So, wholesaling seemed like the path to go. I did buy a course on it. I went through a course and learned a lot. Glad that I did that. And like I said, started doing deals and I was kind of a failed wholesaler. That’s how I got into flipping because I realized the deals were good. I just wasn’t able to convince local investors that they are good deals. And after estimating all the rehabs and looking at the ARV, I realized I can flip these properties easily.

Brett McCollum (14:12.97)
Right.

Peter Skobic (14:19.742)
and that’s how I got into it. I flipped the first one by myself, me and my wife, and then the second one I did with our current business partner and we kind of kept going with those. We’ve completed about 30 so far.

Brett McCollum (14:34.11)
Wow, good for you man. That was approximately when did you start the first flip?

Peter Skobic (14:38.574)
That would have been late 2021.

Brett McCollum (14:42.784)
That’s incredible. That’s the resilience of like, that’s why I said at the top of show, like evolution of real estate investing because I don’t know, have you ever heard of a book called Who Moved My Cheese?

Peter Skobic (14:59.414)
I read it twice,

Brett McCollum (15:01.106)
It reminds me of that, right? Where it’s like, okay, this is what I’m doing. I’m doing this. This isn’t like, well, the cheese is not here. Now it’s here, you know, and you’re, but like, it takes a resilience to not get discouraged in the fact that like, you know what? I can’t keep, for the moment, I can’t keep buying these rental properties because I’m like, I got to have active cash. You know, I need income to be able to buy for the down payment.

Well now I’ve done the wholesale thing, I got the course, I’ve taken the course, I feel good about it, I got a deal under contract, my gosh, I’m doing it. Buyers don’t like, and then it’s easy to really just get discouraged by that, but instead you kept pivoting and now like 30 flips later. It’s like, it’s a remarkable testament to resilience and not just cashing it in at the end, like I’m done. I’m done. That’s pretty cool.

Peter Skobic (15:52.557)
I think a big part of it is not thinking about 15 steps ahead. Like how am going to do this? How am I going to do that? You have to think about just what is the next step, right?

Brett McCollum (16:04.586)
Right.

Peter Skobic (16:05.134)
Because if I worry about 20 steps ahead, I’ll never end up doing anything. I’ll end up in that paralysis by analysis, right? And so funny story about that. A few years back, I had a friend in California and we were looking for some real estate out of state and we found a pack of five duplexes that were for sale south of Atlanta, Georgia. And they were listed at 475,000 for five duplexes. The deal was good.

Brett McCollum (16:20.383)
Okay?

Peter Skobic (16:33.313)
the rents were good, it made sense. The only issue was they wanted cash or nothing. So there was no, you couldn’t use a lender. It had to be a cash transaction. No, it was listed by a real estate agent, but they were just not allowing, the seller did not want anyone to use a loan. And so I…

Brett McCollum (16:39.38)
Mmm.

Brett McCollum (16:43.54)
Was it a wholesaler selling it?

Peter Skobic (16:56.718)
Talked to my buddy and we got together. looked at a deal with the old math and we said, okay, it really makes sense. It’s 475,000. We don’t have 475,000 cash. How are we going to tackle this? So, you know, we got together, we run some numbers, all the money out of my checking account, all the money out of his checking account, my savings, his savings. We put all of it together and we were missing 425,000. And so, you know,

Brett McCollum (17:23.754)
Yep.

Peter Skobic (17:25.122)
We had about 50k between the two of us. And so we just didn’t let that bring us down. We made a lot of phone calls, talked to a lot of people, got some private investors, covered the rest of it, bought the deal. And then we a, we just kind of split it up. He kept two of them. I kept the other two. We ended up doing a refinance and we ended up getting a loan on it and got the money back, pay back the investor and we still have our duplexes.

Brett McCollum (17:55.082)
Wow, how long until you paid back the investors? How long was that process?

Peter Skobic (17:58.83)
It was pretty quick. We were able to do a delayed financing on it basically. So buy cash, do a delayed finance, cash out refi. We split them up so that he keeps two, I keep three. And we paid him back within, I would say probably three months or something.

Brett McCollum (18:16.586)
Wow, that’s very quick. Good for you. Man, and do you still own those properties today?

Peter Skobic (18:21.292)
Yeah, yeah, definitely. And it’s interesting to see what happened with appreciation and what happened with rents in the meantime.

Brett McCollum (18:27.296)
that you look like, you seem like, I was a genius.

Peter Skobic (18:31.878)
That’s the beauty about real estate. Over the years, I started a little meetup in California and it was called Club 500 Wealth Network. We started in our living room. There was 11 folks at the first meetup and then we started getting 20 and 30 and then we couldn’t do it at our place anymore. We got a local office where we were meeting.

Brett McCollum (18:41.6)
Mm-hmm.

Peter Skobic (18:56.446)
We started getting 40, 50, 60 people show up to the meetups and then COVID came. So we had to go online and that’s where we started the group Real Estate Investing Flipping and Wholesaling group on Facebook and we have 42,000 members now. But for that group, I used to teach different principles in real estate. And at one point we were talking about the fact that most investors when they buy rentals, they focus on cash flow.

and that’s the only metric that they use when they’re buying rentals but there’s really six different ways the real estate pays you and I started talking about a term I come up with an acronym ADDICT like I’m addicted to real estate like ADDICT and the acronym was appreciation, depreciation, debt pay down, inflation hedge, cash flow and tax deferral

is the six different ways that real estate pays you, Addict. And that’s really what it’s all about. I mean, that’s why we invest. You buy a few rentals, you’re getting a couple hundred bucks a month from a rental. it seems like, sometimes it seems like when the expenses come up, when you have turnover, it might wipe out your cashflow. But keeping in mind, there’s six different ways real estate pays you. And several years later, you always end up looking like a genius, even if the deal wasn’t that great to begin with.

Brett McCollum (20:21.44)
Yeah, that’s really cool. Kind of a little moving on from the flip side of things. You mentioned that you started transitioning and doing a little more on the lending side now even. Is that correct?

Peter Skobic (20:35.054)
Yeah. Yeah. I wanted to really round out my real estate investing experience. You know, we’ve done, we still have rentals. We flip houses. We work on, you know, six projects at a time right now. But we used hard money lenders a lot in our, in our business over the years. And there were some aspects of the lending industry I wasn’t really impressed with. didn’t like how opaque it was, how hard it was to tell like

you know, why something’s approved, why it’s not, why is this rate or that rate? And I got into it because I wanted to become a lender and learn everything I possibly could. I really enjoyed it. do it now. I help investors buy fix and flips. So, know, I provide fix and flip hard money loans as well as DSCR loans on rental properties, bridge loans, cash out refinances, all of that.

Brett McCollum (21:24.96)
Yeah, mean that’s that’s super remarkable like just again back to the you just evolving and growing and evolving and growing, you know, and that’s a It’s a really powerful like tool to To have in your backpack is like hey, can navigate with the market I can do you know, because I’ve proven it over the years and It’s really cool to see you doing that

Peter Skobic (21:46.542)
I think it helps with lending clients. It really helps to have a lender who actually does what you do and kind of understands what you’re looking for and comes up with creative ways to make it happen.

Brett McCollum (21:53.428)
That is really powerful. Yeah.

Brett McCollum (21:58.036)
Well, and two, like, you know, especially in the last couple of years, there’s been a lot of unique challenges in the market, right? For flippers, you know, and, and such and having an operator that understands that, you know, on your, of your side of it really helps on some of the empathy for sure, but also on the, you know, Hey, I am one too, and I can talk high enough level with you to like, try this, don’t do this. You can work with these people and the I’m sure the level of customer service that you can offer now.

to your target clientele is, know, second, oh, would probably, I’m just getting to know you the little bit of that I have, it’s probably second to none. Is that kind of right now, like today, more of your main focus is the lending? Are you still flipping? Like what’s, what does today look like?

Peter Skobic (22:44.942)
So it’s between lending and flipping. I would say that they’re 50-50 at this point. like I said, with flipping, I mean, it’s a good operation. We have six flips on average that we’re working on. So the way that splits out is typically we have two that are already on the market that are finished, that are ready to sell. We have another two that we are currently working on because we have two contractor crews. And then we have two that are in a pipeline under contract ready to be bought.

Brett McCollum (22:48.735)
Okay.

Brett McCollum (22:56.446)
Mm-hmm.

Peter Skobic (23:12.174)
or are already bought and just waiting to be rehabbed next. We try to keep our contractors busy. It took years and years of trial and error to get to the couple of teams that we have today. We’re very happy with them. So we try to keep them busy as much as possible. Any times if we miss one, if the deal falls apart for whatever reason and we don’t have a house lined up for them, they finish my attic in the house or do some…

changes to my own house or whatever it takes to keep them busy.

Brett McCollum (23:43.326)
Absolutely and your rentals you mentioned were more in the Georgia market are what about flips are they also there are they somewhere else?

Peter Skobic (23:51.234)
Yeah, so rentals, I have all of my rentals in Georgia. Currently, we also had six units in Indiana and a couple in Pennsylvania and several in New York state. Over the years, we ended up selling those off because there was appreciation in the actual properties, but the rents were for some reason kind of depressed. So we ended up selling those off and kind of flipping them in a way. All of our flipping activity is in and around Watertown, New York.

Upstate New York. Yeah, it’s really nice because this area, you know, when we moved here, we realized that most of the houses were built in the late 1800s, early 1900s, kind of a flippers, you know, dream. And so most houses do need to be rehabbed here. And there’s a big military base that kind of brings a constant flow of people moving in and out.

Brett McCollum (24:21.426)
Okay, keeps you pretty local. Yeah, I like that.

Brett McCollum (24:41.504)
Yeah, that’s incredible. Yeah, I mean, we talked to that pre show, I’ve got some family up there, which is, know, and it’s a, I know, right? It’s like, oh, I guess you don’t, it was cool. But yeah, I mean, that area for in and around military bases, there’s a lot of opportunity with that. you know, you keep, if you can keep it active, that’s really great. Question, if people, because I this has been phenomenal, like you’ve got a wealth of knowledge to give across various.

Peter Skobic (24:48.802)
What are the chances?

Brett McCollum (25:10.186)
disciplines in real estate. What’s the best way for people if they were to want to connect in some way ask some questions, just follow along the journey with you, like what’s the best way for that to happen?

Peter Skobic (25:20.632)
Sure, yeah. So my email address is info, that’s I-N-F-O, so info at club500.us. My website is www.club500, so club500loans.com. There you can get loans for, know, get quotes for loans for fix and flips, rentals, refinances, whatever it may be. I’ve got a two-minute intake form there.

And Club500.us is the link to our Facebook page for Club500 Wealth Network and alternatively Realisted Investing Flipping and Wholesaling Group on Facebook. Again, 42,000 members. So it’s a great way to kind of talk to fellow investors, ask questions, get them answered. We’ve got a lot of experienced folks there who provide some great answers.

Brett McCollum (26:13.888)
No shortage of opportunities for people to reach out to you. And that is, I guys, I encourage you to do that. between the Facebook group and the Club 500 links, reach out to Peter in some way, guys. He’s got a lot to offer and you’re definitely like a leader in our space, and an absolute, you crush, man. It’s really like really great to talk with you.

Peter Skobic (26:39.266)
Yeah, hit me up. Love talking real estate as always.

Brett McCollum (26:42.196)
Yeah. Well guys, it’s been a great show. I really appreciate you guys taking the time to listen. Peter, again, thank you for being here with us. Guys, take care until the next show. We’ll see you on the next one. Bye guys.

Peter Skobic (26:52.046)
Thank you.