Transform Your Financial Future: Real Estate Insights

John Harcar (00:01.23)
Alright, hey guys, welcome back to our show. I’m your host John Harcar and I’m here today with Gustavo Rodea. And what we’re going to talk about is his journey in real estate, but also how he’s using hard money and creative ways to purchase more property versus using all this cash. Remember guys, at Investor Fuel, we help real estate investors, service providers, I mean all real estate entrepreneurs, 2 to 5X their business by providing the tools and resources to grow

and build that business they want to have, which helps them live the lifestyle that they’re looking to live. So Gustavo, man, welcome to our show. Happy Cinco de Mayo.

Gustavo Rodea (00:38.276)
think happy single-minded to too, man. Let’s get some Corona. So yeah, my name is Gustavo Rodea. I was born in Mexico. I’ve in the US for 25 years. And so I’m a business owner. I’ve owned furniture stores for the last 22. And from book, Robert Kiyosaki reached out for that. How he explained that you’ll be an employee, self-employed.

John Harcar (01:00.622)
The good old purple book.

Gustavo Rodea (01:08.228)
business owner and investors. And I think I went to the quadrant following that formula and made me think about investing on property. So one of the first properties that I acquired was one building that I was renting from a furniture store back in 2010. was an owner finance deal. Learn about it, pitch it to the landlord, and he agreed to sell me that building as an owner finance.

John Harcar (01:23.374)
Hmm?

John Harcar (01:35.344)
cool. Okay.

Gustavo Rodea (01:36.016)
So that was kind of like the first transaction. you know, I mean, I was paying rent and double my mortgage payment was lower than my rent. that building is pay for it’s in a rural area, but it’s this pay for. So that was kind of like the first thing that I did as a real estate investor.

John Harcar (01:55.68)
Okay, let’s go backwards. like I’m one of the guys that likes to really get a lot of the backstory. Were you born in the United States? Were you born in Mexico? Where were you born?

Gustavo Rodea (02:03.436)
I was born in Mexico. I moved here when I was 17. And since I’m 43, so since then, whatever the magic, that’s got me. There you go.

John Harcar (02:11.734)
OK. 26 years. So you came here now and you said you were working in furniture stores or owned furniture stores?

Gustavo Rodea (02:21.999)
I was 22 when I started my first business and it was a furniture business. 22 year old and I my first furniture store and I’ve been in the industry for 20, 20 some years.

John Harcar (02:25.742)
K K

John Harcar (02:35.564)
Was that something that like your family was in, you know, that start or how did you get into furniture?

Gustavo Rodea (02:41.028)
No, I just had a background on sales. When I was 17, I did a door-to-door salesman, which by the way, that’s the best training that you can get as a salesperson. And I used to read a bunch of Sixth Seegler, Og Mandino books. And so I had the background in sales. So one day I was walking on a flea market and I saw a white guy, Robert, and a Latino guy struggling with, know, completed a transaction.

John Harcar (02:46.177)
Okay.

John Harcar (02:49.742)
100%.

John Harcar (02:55.989)
Ogman Dino is great, yeah.

Gustavo Rodea (03:10.434)
So I approached him and I told him, look, I know I can make that sale. How much commission will you give me? He’s like $50. And since then we build a relationship on that flea market and I start helping him sell in mattresses. Within few months, I start buying mattresses for him and sell them on payments. And then a year later, I have enough revenue to open my first store.

John Harcar (03:30.862)
Mm-hmm.

John Harcar (03:37.282)
Okay.

Gustavo Rodea (03:38.402)
So yeah, that’s basically kind of like accident if you, because my original idea was to come here for two years and then go learn English and go back. But then that came to me and then all of sudden at 22, I had a business that was a successful run furniture store.

John Harcar (03:46.848)
Okay.

John Harcar (03:56.184)
Okay, and then that guy was struggling and when he said he struggling, was struggling just with the communication part. Okay, awesome. So of the whole sales beginning, right, what do you think, you know, from that door to door sales and as the things you learned, what do you think were some of the more important aspects of sales that you learned that you carried over into real estate?

Gustavo Rodea (04:01.091)
Yep.

Gustavo Rodea (04:16.228)
Well, negotiation for sure. That’s that’s going to be one of the ones. But, you know, I think in the way I always have seen myself as adopting a philosophy as a person of what do you do every day? Right. Like I help people like if it’s in my furniture store, I’m thinking I’m going to help you get the best night of sleep by providing you the more information I can on the mattress and the real estate as an investor. I have helped, you know, people get sticky situations. Right. And

And that’s one of the things that is on both ways is when you acquire property and when you sell property, I wake up every day to solve someone else’s problem and make money in between. And if I had that mentality, then I will succeed. And I think I have with my past transactions, every time I get myself involved in a transaction, I go with that mindset. I’m going to help them. I’m going to help this transaction go through closing.

John Harcar (04:54.306)
Yep. Yep.

Gustavo Rodea (05:11.16)
and I’m gonna make money out of it. And it has been working that way. But I think it’s the philosophy that I started when I was younger of helping and that came through that Sixth Sigla book. The that it stick to me and it’s one of my philosophies, you can have everything in life if you help others get what they want.

John Harcar (05:31.443)
And why is that important to you? Why is that kind of your main philosophy?

Gustavo Rodea (05:36.164)
Because when I help someone make money, and for example, myself, people that are in my three furniture store right now, right? I teach them, I train them, I train them how to make money. When they make money, I make money. When I help my contractors make money, I make money. So it’s like, you know, I’m here to help my friend, how can I help you? So that’s kind of like the philosophy and it really, it really stick to my career as a…

John Harcar (05:56.758)
I love it. I love it.

Gustavo Rodea (06:05.108)
as business owner and as a master as well.

John Harcar (06:07.83)
Have you ever read the book The Go-Giver?

Gustavo Rodea (06:10.924)
No.

John Harcar (06:11.638)
OK, if you ever get a chance, it’s called the go-giver. And they talk about the laws of stratosphere success. And one of them is give more in value than you receive. So that’s kind of the same thing. Help people grow, and you’re going to get that back. So you’re renting a spot, and you end up financing it from the owner. How did you learn how to do that?

Gustavo Rodea (06:33.902)
same thing, books. I went to this seminar where, six-figure seminar, by the way, and there was this guy talking about real estate and you know, they, know how seminars are, right? Like you go there, they upsell you, upsell you, upsell you. So anyway, I bought out a book and, and from, from this guy and it was a real estate investor. I forgot his name though, because I, I guess, but I, remember reading something about the owner finance.

John Harcar (06:39.214)
Mm-hmm.

Gustavo Rodea (07:02.18)
that if the bank doesn’t approve you, there was a way to ask someone. So it was kind of a strategy to write up on how to approach people. So I read it and I apply it. And I think one of my, I’m high school graduate, right? But one of the things that I have been done all my life is educate myself in different ways, But also have the education, but then apply it. That thing that’s key for me, I learned something.

John Harcar (07:29.0)
Yeah, that’s huge.

Gustavo Rodea (07:30.978)
I grab a I call a golden nugget and grab that and apply. And I learned that from a seminar. They say that if you read something, you know, knowledge is good and the smartest people, there’s a lot of bunch of smart people broke because they don’t they don’t apply what they’re learning. I think, you know, even for someone that’s watching this podcast, if they can apply one little thing to their everyday life, that can change. But it’s the action that matters. And I think that’s right. I apply, I learn and apply and it works.

John Harcar (07:55.414)
Exactly.

John Harcar (08:01.036)
Well, and that’s problem sometimes. A lot of people, you know, they get that analysis paralysis, right? They keep going, they keep learning and keep learning. If I just learn this next thing, then I can really get going. Well, when’s the best time to start? Yesterday. Get going. All right. So how did you, and I’m just curious, how did you approach this guy that, you know, so you’re paying rent to him and what did you, how did you reach out to him? What did you say to him to get you to sell you the house or sell you the building?

Gustavo Rodea (08:26.926)
Well, think it’s also part of the book says, is build a relationship. I truly know that guy. Like, you he was a veteran, you know, I invited him for lunch. I didn’t pitch him on the first lunch, but I invited him for lunch to get to know him. And then I always been very active with with community in a way, in a little small town in Warsaw as part of the Chamber of Commerce.

I was part of the board of directors. am now on bigger city and I’m still board of directors of the Chamber of Commerce. So it’s always been like that give back mentality. But also that’s where that’s where those guys are. Right. That’s where the owners of buildings are building those relationship outside the business environment. It worked because I made him. He knew who I was, you know, like, and I think that’s why he did it, because once I invited him second time for lunch to get tacos.

John Harcar (08:58.54)
Okay.

Gustavo Rodea (09:20.662)
It wasn’t Cinco de Mayo, but he did get tacos. But but then it was he didn’t hesitate to say it. He’s like, yeah, yeah, we can we can work it out. But it’s like they’re building the relationship, I think is the key, because some other investments that I have done after that is part of that. Like building the relationship and and and, you know, I guess have the credibility for me as a Latino. It’s a little bit I had to knock more than the average guy out there because, you know, I’m Latino and it is what it is. Right.

Some people that don’t know me, I had to have the credibility on the back and being a business owners, give back to the community, stay on the board of Chamber of Commerce and other volunteer work that I do, validate me as a person, as investor, but it helps because, know, it’s, you know, just people out there that don’t know, you know.

John Harcar (10:06.391)
Right.

John Harcar (10:12.526)
Well, and I think it’s important to like, you know, a lot of people are afraid to go and approach some of these business owners. Like they’d go to a, maybe a meeting, a chamber of commerce. They’re afraid to, cause I don’t know if they’re intimidated or what, but you know, a big thing is, is just going and breaking the barrier. Just invite them to a lunch, invite them to a coffee, know, get built, start to build that relationship. So tell me what is your team or your business look like now?

Gustavo Rodea (10:36.814)
Well, so one of the things that I want to talk to you about is how, as Latinos, sometimes we hesitate to use the bank cash, right? And for a while after, that was kind of my first investment, but then the second one was like, just stay slow on the mobile homes because I can buy those cash and flip those cash, right? So the mobile homes was my next move because it was…

John Harcar (10:47.468)
Mm-hmm.

John Harcar (11:00.078)
Okay, so you got into Bobo Homes next.

Gustavo Rodea (11:05.634)
It was a way for me to do it. I didn’t know about hard money loan into like 2023 though. So I did a lot of transactions with my own cash, you know, and I gained within from 2010 to 2023, I had four properties from 2023 to now I own 22 properties. So I’ll average and learn again, then learning the game of a real estate, which by the way,

John Harcar (11:12.27)
Hmm.

Gustavo Rodea (11:35.82)
I’m writing a book about a Mexican investor and I would give all the kids of how I went from four properties to 22 with hard money lending because that was what really, know, imagine this, I used to buy a mobile home for a hundred thousand, you know, land and mobile home, a hundred thousand, one, right? And that would take me probably six months to eight months to a year, depends on the area.

With hard money lending, with the 10 % down, I was able to flip properties for 300,000, 400,000, 200,000, but I was doing three. I will, you know, so that was kind of leverage in credit, cash and money, right? So, when able to go to a little bit more and adding more to my portfolio, but also, you know, implementing the, on the other way,

John Harcar (12:14.797)
Mmm.

Gustavo Rodea (12:34.36)
people to owner finance because you get to situations where, you know, it’s a mixed use property. You can’t do nothing with a bank’s one like it has a mobile home, has commercial building, has this. But then when you know this, you can preach to these people like, OK, well, let’s do owner finance and give you some amount of money down ballooning five years and being able to do that. But you sort of have to know. And this comes with.

John Harcar (12:44.578)
Right.

Gustavo Rodea (13:01.912)
and list my knowledge on real estate came with, you know, become a member of the local and Syria group, local investors, masterminds. I mean, that’s my learning. It’s always been my tool of learning other people’s journeys. So when something like that come to me, then I can apply what they learned from that journey. And I think that’s the biggest one. And when I knew about

John Harcar (13:12.908)
Yeah.

Gustavo Rodea (13:27.214)
hard money lending, just like, was like, damn, so I can use this hundred thousand dollars that I have already used for investments to really exploit what I had. So, you know, it really, it really helped a lot to know how to utilize it. You know, there’s some lessons learned in between, but overall, you know, like it’s just utilizing the OPM, love that word, other people’s money. that’s, and that’s, that’s more to learn.

John Harcar (13:36.513)
Yeah.

John Harcar (13:43.704)
course.

John Harcar (13:49.186)
or other people’s money.

Gustavo Rodea (13:53.284)
and learning on the process to step it up now, my goal is to go to commercial and being able to get to that, play on that field. So learning now eventually will play that. But that’s really what, you know, a lot of Latinos, I know a lot of Latinos that own a good portfolio and they pride of, oh, it’s all cash. But man, in my mind, I’m thinking like, man, with all that money, you know how much money you could like, let’s say like a million dollar in houses. And I’m like,

John Harcar (14:03.576)
Got it.

John Harcar (14:11.522)
Mm-hmm.

Gustavo Rodea (14:23.234)
Man, with that million, you could have had like 10, you know? Easy, easy. But, but, you know, the fact that they don’t know, I didn’t know for a long time, you know, like it’s so, and I can imagine if I were to know, man, man, you know, as of now, that’s from 2023 to now, it’s two years, you know, it would be like a lot.

John Harcar (14:26.231)
Easy.

John Harcar (14:45.336)
So now are all your stuff mobile homes?

Gustavo Rodea (14:48.132)
No, no, I graduated from the mobile home to houses because mobile homes, I was doing it for, because I can pay for those cash. know, go to the land for 60, pay the trial, double-wired for 20 something, fix it for about 39. I got about 139, sold it for $12.45 within six months. But, you know, it was just my money. I didn’t get no loans at all. Now, scenario, I’m putting

John Harcar (14:51.745)
Okay, alright, to single family.

John Harcar (14:58.03)
Got it. Okay.

John Harcar (15:08.248)
Mm-hmm.

John Harcar (15:13.026)
Yeah, yeah, yeah, yeah, yeah.

Gustavo Rodea (15:16.74)
$20,000 down, right, from the bank, my holding costs is another 10, I still making the same money with less money invested out of my pocket. And I can do three of those, right? So that’s the leverage that I’m getting by utilizing the hard money lending.

John Harcar (15:25.952)
Okay. Yeah, I know that makes sense. That makes sense.

John Harcar (15:33.11)
And are you flipping them and keeping them? like, how do you determine, how do you determine which ones you keep?

Gustavo Rodea (15:35.972)
I flip, flip, hold. You know, I’m normally trying to keep like on the city, Wilmington, I try to keep whatever I can in Wilmington as long as it had the 1 % rule. And then the other reason is because the city allows to put an ADU on the back. So that would be a good strategy for later on to add on in the properties that I own here.

John Harcar (15:58.618)
okay.

Gustavo Rodea (16:06.136)
But also, you know, my strategy is like, if I don’t have money invested in a way that if I refinance and I get my own money back. So if the value of the area is good, I’m going to refinance it, get my money that I invested and keep it. So if the area is good, that’s kind of my strategy that I will do that. So it depends.

John Harcar (16:26.542)
Okay, very cool. What are some of the struggles that you’ve had in your business, transitioning, going from mobile homes to single family and just building and growing a business?

Gustavo Rodea (16:39.78)
Well, number one struggles right now is leads. There’s not a lot of properties. The Wilmington area where I’m from, just boomed. And I think it took away the middle class. There’s no houses for under 200, 300 even. So then lot of that, was approved for the $300,000 and up. There’s no houses here. So that’s kind of a struggle. But the other one is also

John Harcar (16:55.566)
Mm-hmm. Yeah.

Gustavo Rodea (17:07.352)
getting to know the invest, the hard money lenders. mean, like I said, it does have a way. Well, number one, not knowing exactly how it is. But you sometimes it come up like, okay, well, we’re going on the closing table. And then all of sudden they realize that the properties rural area, for example, and they don’t close down, they don’t close on the property. They ask for more down payment. think

John Harcar (17:33.39)
Mm-hmm.

Gustavo Rodea (17:34.168)
hard money lending business on the refinancing side of it. It’s been kind of like struggle trying to find a good lender that is consistent. Man, you know, at one point my credit was pulled 19 times and I only did four deals. Because they were promised, it’s like you met up first girlfriend or boyfriend and they promise you the moon, the stars. We’re gonna do it, we’re gonna do this. I just gotta pull your credit, right? And then they pull your credit and then.

John Harcar (17:48.472)
Jeez.

John Harcar (17:56.206)
Ugh.

John Harcar (18:00.718)
You

Gustavo Rodea (18:02.84)
They’d be like, no, we can’t do it, man. I’m sorry. was like, why you pull my credit?

John Harcar (18:07.778)
Exactly. It’s like, could you just kind of pretty much tell before? I mean, yeah.

Gustavo Rodea (18:12.196)
Yeah. So now, mean, leave it in letter, right? Now, first thing I ask, do you have to my credit? And if you pull my credit, on what part of the process are you pulling it? Because now it’s like, no, look, check the address, make sure on your end is clear, because I don’t want to pull, you pull my credit, and later on you come back and say, oh, it’s rural, we can do it. I say, I want you to tell me that. And then after that, I’ll let you pull my credit. So, I’ll make a letter, right? And, you know, be able to, you know, like,

John Harcar (18:26.648)
Mm-hmm.

John Harcar (18:34.495)
Yeah, that’s smart.

Gustavo Rodea (18:39.332)
I always see everyone that works with me, no matter who it is, as a team, as partners, because we’re both making money, right? And I think that’s one of the things that whether it’s a contractor, investor, realtor, hard money lender, it’s a partnership. And building that partnership is through communication and have a good communication to avoid all those little hickeys.

John Harcar (19:05.353)
Yeah, no, 100%. What’s your buy box? So if there’s someone in here that someone’s on the podcast listening and maybe they’re wholesaler in your area or whatever, what’s your buy box out there?

Gustavo Rodea (19:14.692)
Under 400k residential, under 400,000. That would be anything that is in the North Carolina because I’m now expanding to anywhere in North Carolina.

John Harcar (19:26.526)
So it doesn’t have to be Wilmington, it can be anywhere in North Carolina.

Gustavo Rodea (19:29.449)
in North Carolina under 400,000. I think that’s my

John Harcar (19:31.608)
Single family, multi-family.

Gustavo Rodea (19:34.466)
I would go up to 2 million because that’s kind of like the buying box, the money that I can put down payment up to 2 million on the, you know, I got to my feet wet in there. mean, it’s small. would be good to learn the, you know, whatever you need to learn on that business, right?

John Harcar (19:48.748)
Yeah, of course.

Gustavo Rodea (20:00.322)
Yeah, definitely this year is, we still have over half of the year to be able to make one commercial transaction.

John Harcar (20:07.246)
Okay, so when you, yeah, and was gonna ask you when you say commercial, you’re talking about small, small multifamily, small to medium multifamily, okay. Are you gonna pursue any type of mentors or anything for that? Or you’re just gonna kind of learn how you’ve been learning and.

Gustavo Rodea (20:21.536)
I’m part of a mentorship now program and there’s on that within that program is they they’re they’re teaching you know how do you get your first deal and all that so well the collective genius you know we’re actually meeting the 12th to the 15th every we meet in every quarter so I learned a lot

John Harcar (20:31.222)
Which program is it? I’m just curious.

John Harcar (20:39.001)
yeah, okay. Okay.

John Harcar (20:49.006)
Okay. That’s what, yeah, no, I get it. mean, it’s like the people in our mastermind, right? We have, it’s the same kind of thing like collective genius where we have a bunch of people that are where you’re wanting to be. What do you think are some trends and stuff that you’re maybe seeing in the industry, the business, your business? I mean, what kind of trends are going on right now that you’re looking at?

Gustavo Rodea (20:49.732)
from those guys and it is guys that are doing it basically, know, like it’s.

Gustavo Rodea (21:09.038)
Yeah.

Well, it’s in my area, again, that part of, you know, kicking out the small middle class from the city, but there’s opportunities up and up on the outskirts of the cities, know, like, especially, you know, like those rural areas, they’re more developed and it’s going on. think apartments are also, you know, taken away from that pool because their rent is affordable in a way.

John Harcar (21:25.432)
Mm-hmm. Yeah.

Gustavo Rodea (21:41.116)
They started that way anyway. But and then millennials millennials are changing the the the way it works because they so picky when they’re buying houses like the house has to be freaking perfect because they don’t want to shit. You know, they would change nothing on the house. They want it to be perfect. And they’re the ones buying the houses now. So, you know, they’re really like if you have an online tour on your house, you’re to have a higher chance that a millennial might pick it up because they don’t want to go to the house.

John Harcar (21:53.247)
Right?

John Harcar (22:09.75)
Yeah, that’s true.

Gustavo Rodea (22:09.998)
So it’s like knowing that who’s buying the house and who you’re, if you’re gonna sell the house, who’s your market, right? And that’s the transition. We’re buying from Baby Boomers and Gen X’s because the empty nesters and then we’re selling it too. So you better do a modern look on the house so you have a higher chance to sell it to the millennials because millennials are a tough market, I think, to do that.

John Harcar (22:23.822)
Mm-hmm.

John Harcar (22:40.044)
Yeah, no, I understand that. If I appreciate you coming on and sharing all this stuff, man, it’s great information. If there’s folks out there that are listening that are in your in your market and like I said, that they might have a property, what’s the best way for them to reach out to you?

Gustavo Rodea (22:40.472)
Yeah.

Gustavo Rodea (22:55.64)
Well, actually, I have a website. My name is GustavoRodia.com and all my information is there. I’m actually bringing out a soon as the Mexican entrepreneur, and I’m not sure if I’m pronouncing the word correctly. There you go. That’s it. That’s the first book. Yeah, that’s the first book that talks about all my business that I own. I own a bar cellar. And

John Harcar (23:11.072)
Entrepreneur? Yeah, the Mexican entrepreneur.

John Harcar (23:19.128)
Mm-hmm.

Gustavo Rodea (23:22.156)
I also do roofing, because I know some Mexicans. And then probably the fourth quarter, the Mexican investor is coming also. So I’m building sort of the brand of Mexican and then Mexican investor of Mexican. have several books that I’m going to pull out, but it’s basically I walk the talk on my experience. So I’m now making up things.

John Harcar (23:25.442)
hahahaha

John Harcar (23:35.916)
Awesome.

John Harcar (23:47.447)
I love it.

Gustavo Rodea (23:50.306)
I’m just telling you, for example, on the Mexican investor, I’m talking about a lot of how I learned to utilize hard money, how it helped me to add more properties to my portfolio. And maybe some other people can benefit from that. So it’s just basically my life story, examples, and maybe someone can benefit from it. But that’s basically

John Harcar (24:03.693)
Love it.

John Harcar (24:12.866)
I’m sure they can, right? I’m sure they can because you got a lot of great experience. I appreciate you sharing what you did today. We’ll put your website and all your contact information down in the show notes. Guys, I hope you really enjoyed this conversation, man. It was really good. Gustavo, thank you again. Folks, we’ll see you guys on the next one. Cheers. Happy Segure Mayo.

Gustavo Rodea (24:32.42)
Happy Saint Louis of May.