Not Your Average Investor Show
Not Your Average Investor Show
419 | Why The Smartest Investors Are Expanding Their Portfolio Right Now w/ Leslie Wilson
The difference between an average investor and someone that gets outsized results are the decisions that differentiate them, and right now, there are many in our community that understand it is time to buy rentals... but many are still on the sideline.
That's why we decided to bring on one of our brightest, most experienced investors (who recently added to her rental property portfolio) onto this weeks Not Your Average Investor Show-
So you can see for yourself why she recently decided to buy more rentals in Jacksonville!
Her name is Leslie Wilson, and we call her "The Maven", thanks to her wide range of experience and expertise in the real estate investor space.
She'll be joining the co-founder of JWB, Gregg Cohen, and show host, Pablo Gonzalez, to share her experiences like:
- what made her think it's a good time to buy rentals in Jacksonville
- why she has moved more of her portfolio from other markets, to Jacksonville over the years
- how have her investments with JWB performed over time
- and more!
Leslie has been doing this long and well enough to have reached that early retirement lifestyle we all hope to get.
Don't miss your chance to pick her brain about how she got there.
Join us to get up to speed on what risks and opportunities lie ahead!
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https://jwbrealestatecapital.com/nyai/
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https://jwbrealestatecapital.com/turnkey/
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Today we are talking to, you know, a celebrity, a celebrity in our community. We call her the Maven from the mountains of Colorado. She's one of the most experienced investors that we have in our community. She has been investing for 28 years. And four different markets. And she will tell you the rest of that punchline when we introduce her shortly. But the reason why is because recently she's added some more to her portfolio. So we're really diving into the psychology of why the smartest investors are investing right now. Welcome everybody to this week's edition of the Not Your Average Investor Show. I'm your host. Pablo Gonzalez, with me as always, the man that I affectionately like to call GC because he's got the genius concepts, knows how to generate cash flow, great co host, and because his name is a go right co and say hello Greg. Hello everybody, great to be with you. And the aforementioned star celebrity of our community, the maven from the mountains of Denver, the irreplaceable, always brilliant, Leslie Wilson. Say hello Leslie.
Leslie Wilson:Hello, everyone.
Pablo Gonzalez:It's good to have you back. Leslie, when's the last time you were on the show?
Leslie Wilson:Last week, actually.
Pablo Gonzalez:Oh, I mean, I mean, This is my,
Leslie Wilson:uh, inaugural voyage.
Pablo Gonzalez:No way. No way. So you've only been on like a fan appreciation show then because you've been on camera before. Okay. Or maybe
Gregg Cohen:she was on set. Summit, the last summit that we did is correct.
Pablo Gonzalez:Oh, man, this
Gregg Cohen:is juicy.
Pablo Gonzalez:I thought so too. I thought so too. That's a mistake on our part. All right. Let's see what we're super pumped to get into, your journey, what you're learning, why are you thinking about it right now? We've got some ideas around your creative financing. Why you've whittled down from like four markets to one market, a whole bunch of great stuff to get into. I know you've got some advice for folks as far as like downloading rich dad, poor dad, education things. But, um, we usually start with something else. Leslie, do you know what that is?
Leslie Wilson:The roll call
Pablo Gonzalez:baby. Yeah. We got Joanna kicking us off here in the chat. We got the mystery man. Danny Davis checking in from Kuwait. Danny, good to have you keeping us safe. We got Chris Lee from Fernandina Beach checking in. Good to have you, Chris. We got the ringmaster in the house. Drew Barnhill. Drew Barnhill. We got the man of steel. Vincent Barbarite. Vincent Barbarite is back, baby. We got the early bird in the house. Mr. Dean Curry. Mr. Dean Curry. We got the Roger Fonse from the Ilanda Empire. Reggie, how are you, buddy? We got a, we got a Lioff hitter kicking off, kicking off here in the fifth, sixth inning. John Hennings, buddy. John Hennig, Matt Teuchel. Hey! Peter Sam, Teuchel. There we go. We got our regulars, Gary and Rosalind Riley from Marietta, California. We regard you. We got our favorite smile from the Pacific Northeast. Miss Pamela Myers. We got El Gran Amigo. Bill Shields says they do well. We got the better Greg is back. I love when the better Greg is there. He's back, he's back. You're better under pressure when the better Greg is around. Everything's better when it's better. Greg Stone,
Gregg Cohen:good to see you.
Pablo Gonzalez:We got Zenobia Lewis from Stone Mountain, Georgia. She's back again. Zenobia, nice
Gregg Cohen:to see
Pablo Gonzalez:you. Good to have you here. We got the the first family of the Night Traveller of the show, the Patriarch and Matriarch, Ken and Carolyn Maligne. We salute you. Who we salute too. We got the shaman. Nadeem Khan. From the West Coast. We got Tony D in the house. All right, Tony. What's up, Tony D? Good to have you, buddy. Chris Traylor with a good morning. She's got me representing right there. There you go. We got Big Papa in the house. I love it when he calls it Big Papa. Pops, how are you, my man? Founder of the co founder Jay Cohen. Good to have you. My friend LaVaughn Mac is back. Devon, good to have you. You know what time it is? Game time. Game time, baby. Tammy Gabenson's in the house. We got Justine Herrera. We're the happiest user to all. Good to have you. Scott Skelton from A2 Ann Arbor. Is that a new name? I
Gregg Cohen:think that's a
Pablo Gonzalez:new name, Scott. I literally just flew in from Detroit this morning. Lovely. I love downtown. Just throwing it out there. Ashley Florence, From Denver, Colorado, a friend of yours, Leslie, Ashley Flores,
Leslie Wilson:Ashley,
Pablo Gonzalez:Ashley, you have to meet, you have to meet Leslie. She's out there in the Denver area. John Moran from Port St. Lucie, Florida. John is back. My friend and Joel Stofa from Titusville, Florida. It's a new name. Joel, welcome to the
Gregg Cohen:community. Mainly do we have new folks showing up, but they're courageous new folks. I love it. Saying hello.
Pablo Gonzalez:Make a friend. Mohan Patheri. From,
Gregg Cohen:uh, Fremont, California. Longtime JWB client. Nice to see you.
Pablo Gonzalez:Good to have you, Joel. All right. So sorry. I'm just rereading things. Steve Holcomb from Birmingham, Alabama. Steve, good to have you here. Who else we got? All right. I think we're good to go. We got a couple, a couple of announcements to make. Leslie, if you'll, if you'll hang with us real quick I keep messing up the name of this hurricane, Hurricane Milton.
Gregg Cohen:Yes.
Pablo Gonzalez:Why don't you give us a little update about it?
Gregg Cohen:Yes. Hurricane Milton came through last week. obviously, anytime we have a major storm in florida, our hearts, our thoughts, our prayers goes out to those who are affected. Of course, in the state of florida, this was a a one to punch of hurricanes in the last three weeks now. And I think it had everybody in in the country and in the world thinking about us in florida. So we appreciate all those thoughts and those prayers. Of course, I want to give you an update here from the Jacksonville perspective and from the JWB client perspective. And while there were parts of the state that absolutely got hit very hard, we were spared here in Jacksonville. And you know, very blessed that we did not get the brunt of the storm. But I do have some data to share with you just to kind of illustrate. I know everybody, you know, you kind of hear it from Pablo's perspective, from my perspective, I can kind of share what the feeling was like of the storm. But then the data also really helps to put it into comparison. Helene was a much more, was much more of a storm than I think anybody expected here in the Jacksonville area. We had sustained winds of maybe about 40 to 50 miles an hour, different parts in Jacksonville and gusts up to about 60 or 70 miles per hour. And that's the most winds that I had ever been a part of living in Jacksonville for the last 20 or so years. So that really put us on alert. I think one of the most wonderful things is that the entire state of Florida now, I think, took the warnings to prepare and to get to, safety to a level that we hadn't seen here in Florida and the same for Jacksonville. But Milton's Power was not what Helene's power was. We largely had winds of about maybe 30 miles an hour, maybe gusts of maybe 40 or so, or maybe, maybe 50. But certainly not like Helene and much more of one of those, what I would call regular tropical storms that we tend to have here in Jacksonville, of which we are very, very well prepared for. So that's just kind of the feeling of it from a numbers perspective. The lack of wind and the lack of the major storm absolutely reflected in the maintenance numbers. So, for Milton, we had a total of 28 work orders that were opened up due to hurricane Milton. To put this in perspective, we had 190 work orders that were opened up due to Hurricane Helene.
Pablo Gonzalez:Okay,
Gregg Cohen:so much lower. We also report on the call answer percentage because we want you to know and our residents to know that we are here supporting everybody in a time of need. We only had 20 calls that came in the day after the storm. for Hurricane Milton for JWB. Again, we manage about 6, 000 properties. So only 20 phone calls was really wonderful to, to hear and to be a part of, of course, we answered all 20 of those phone calls for a hundred percent call answer percentage. If you remember in Helene, even as we were inundated with a lot of maintenance items, we still answered 96 percent of those phone calls. So. know, all things considered, we always prepare for the worst and hope for the best. And I think from the Jacksonville perspective and from a maintenance perspective, we You know lived out just about what the best outcome could be in terms of fleeing again, no thoughts and prayers for those who are still struggling. There's still people who don't have power in the state of Florida. you know, let's keep that in mind. But, but very blessed overall.
Pablo Gonzalez:Good to know, man. Good to know. Good to know everybody was safe, right? Like, definitely my life experience reflected it, right? 16 hours during Helene. didn't really feel anything during a during Milton. I guess like no news is good news, right? Like if you guys don't have work orders, you guys don't have this stuff. You had everybody ready to man the phones. Didn't come in. Sounds good.
Gregg Cohen:There you go.
Pablo Gonzalez:All right, great. So we got, we dodged a bullet there. Leslie, we want to get into your story, but first Greg has a little competition that he's a part of that, that he needs to just throw it out there for the community. And, let's see how you all respond. GC, what's going on? What's going on
Gregg Cohen:inside? Every once in a while, maybe two, three times a year. There's something that I asked for the community's help with. And I'd like to throw in one of those asks right now, cause I know you guys love and support us. We care a lot about reviews at JWB and we have A few different review sites. We have our investor reviews under JWB real estate capital for Google. We also have our property management reviews under JWB property management for Google. And we're doing a little competition here within the team at JWB. there's some local charity money that's on the line. There's some bragging rights that are certainly on the line. And I wanted to ask for all of your help to write us some reviews specifically for JWB property management. this is for all of you who are clients, who are thinking about clients, who are in our network, who are vendors, who have been influenced by JWB in one way, shape, or form. We'd love to have your reviews. We're currently at four stars on JWB property management, and we think that's a little bit low. We think we should be a little higher. Yeah. So we're going to get a little more bold and ask for those reviews on JWB. Places like this and so we would like to get our review rating up to 4. 2 stars by the end of this quarter. And so if I could ask everybody just to take a minute sometime during the show here and post a review hopefully give us five stars and then share a little bit about why you think we're really great to be a part of that would mean the world to me and to my team. And if you could put a special note in there about the not your average investor show that helps us know sort of where the reviews are coming from and. And how we've influenced you. But what is on the line here is the team at JWB is broken into different teams.
GMT20241015-163245_Recording_1292x720:There's a
Gregg Cohen:little bit of bragging rights. We want to be the team that's going to win. I'm a member of one of the teams, of course. And then the winning team who gets the most reviews is going to get 1, 000 to donate to a charity of their choice. And they're also going to get a 500 for that team to go and do something fun offsite. In addition to the bragging rights. So thank you in advance. We would love for any of your support. And I think we put the link in the, in the chat there.
Pablo Gonzalez:Link is in the chat. You can put in the review and here's what Greg won't tell you. Okay, Greg, his team is counting on him right now. Poor Greg is a raging introvert that never talks to anybody but me and to all of you. But what everybody at JWE doesn't realize is that we have the secret weapon. We have the community that every time we put an ask in there, you always show up big. So, You don't know this, but everybody makes fun of Greg for how much of an introvert he is and how he's only famous on Zoom. You have to make this real. Everybody put in a review, say that GC sent ya. You'll learn all these great things from GC and let Greg get his due among his partners who are always out there, always out there shaking hands and kissing babies while Greg is in here doing research for the show. nonstop staying up at night to his own detriment. But this is where he shines. I want you to
Gregg Cohen:shine. I think like 97 percent of what you just said there is a hundred percent spot on. That's why it's only like 3 percent of embellishing. You guys figure out what 3 percent it was.
Pablo Gonzalez:All right. All right. So the link is in the chat. Put the, now you're at, you know, the, now you're at the best show or put in GC's name in there. Help Greg look popular. He needs it. He needs it. And his team needs it. He's carrying the team. All right, Leslie, speaking of carrying things. We're going to get into your story. We want everybody to understand. We have this text number here at the bottom. This is, if you want to get started with JW, we have it. You have a specific question from the show from some of the things that Leslie's talking about, right? Of like freeing up capital. How would a plan like this work for me? All you have to do is text that number. It's going to go right to Tara. She's going to get right back to you and you can just jump in and get started. I dare you to text it during the show and see if she's listening, then see if she can answer right back. But for right now, the star is the Maven. We call her because always, always, always adding value in the chat. Leslie, when we did the investor panel, you were super, super compelling. I feel like you and I have a, have had a bunch of great conversations and you dropped a bomb on us, like as we were starting this thing, right? This, this idea that you have been 28 years, four different markets and you have, Now whittled it down to one market. You want to tell us a little bit about that, about that backstory there?
Leslie Wilson:Sure. I started in 1996. I was living in Phoenix, Arizona, and how I got into this is I had a friend going through a divorce. And every state's regulation for real estate is different. That was something I didn't know. I thought real estate was real estate, but in Arizona, the day you go to the title company, not the lawyer's office to close, everything has to be transferred over the utilities, everything. So when you sign on the dotted line as a buyer, you get the keys and you can move right in. So my friend had. Moved out She was getting ready to close and one of the things title companies do is they call up the employer of the buyer? And they ask, you know, is harvey still employed there? Well when this happened to my friend They found out that harvey had quit his job on wednesday before his friday close So all of a sudden her sale blew up and she called me in a panic And I said look if you knock ten thousand dollars off the price i'll buy it So I was an accidental landlord just trying to help out a friend and, you know, I had a good job. I didn't really think about it. My friend was so grateful. She found a tenant. And that's how I started. And then what I found out was that when I did my taxes the next year, It cut my federal income tax bill in half. The depreciation deduction that you get with rental real estate. Well, that got my attention. Meanwhile, due to, I worked in high tech, I worked for Aeroelectronics, uh, electronic component distributor. I got transferred to Denver. And so I thought, Oh gosh, I don't want to try to manage out of state real estate by myself because really real estate is a team effort. It's very hard to do it all by yourself. So I just assume that if I rolled the money over into a new house. In Colorado, I could just keep going the way I had been going. Well, unfortunately, nobody had told me about a 1031 exchange. So because I touched the money, I got the opportunity to pay 20, 000 in capital gains. Tax. So you only make mistakes like that once. Once you learn them, yeah, I've never, I've done 231 exchanges since, never made that mistake again. But Phoenix is a boom bust economy. Denver, where I live now, Is more of a steady Freddie economy. And there's two kinds of markets. There's an appreciation market where the rental income that you get every month is less than 1 percent of the purchase value of the house. Jacksonville is an appreciation market, but then there's other areas like Detroit where they call that a wholesale market, where the rents are greater than 1 percent of the purchase price. So I started investing in Colorado, loved it. Was able to time the market, I think pretty much perfectly, because one of the things you have to do is watch the economic cycles because things go up, things go down. I used to follow a guy named Harry Dent, who was a demographer, and he caught my attention in the 90s when he predicted the Japanese economic collapse due to their demographics. And he also predicted pretty closely the housing bubble.
GMT20241015-163245_Recording_1292x720:And
Leslie Wilson:so I was able to kind of time things pretty well from him. Now he's gotten very doom and gloom and he just keeps predicting this crash, which I don't think will happen. He's 71 now. He should come on the quarterly
Pablo Gonzalez:update with us.
Leslie Wilson:Yeah, he's, he's on the, the real conservative side of his life. You're more aggressive when you're younger because you've got time to make up for any mistakes that you make. As you get older, you become more and more conservative and resistant to change. So one of the things, if you're older on the older end of things, I would say, surround yourself by young people because they will keep you current. But anyway, I. Thought in 2014 Because i'd gotten used to the housing Bus prices. I thought denver had gotten too expensive. So I jumped into detroit, which was a wholesale market And oh my goodness, what a different culture different environment, So anyway, I I could buy five houses in detroit for what one would cost in denver So I thought I was diversifying my portfolio You No, I wasn't. I was getting a very good education in what not to do. And so I joined fortune builders Because I'm always looking for new information. And that's where I first heard about Greg. But because I just had this disastrous experience in Detroit with property managers who would lie, who I just can't even tell you all the horror stories. I wasn't ready to invest with Greg when he first started talking about his build to rent strategy. So I watched him. And then I found this podcast in 2020 during the pandemic and meeting here every week gave me the confidence and the familiarity with Greg to finally pull the trigger. And so what I did when I saw interest rates go down to the two, two and a half percent range, I thought, This is the bottom. So I did some cash out refinances on two of my most expensive rentals here in Denver, as well as my own primary residence. And I got about 500, 000 worth of cash. And then I went shopping at JWB. And so I bought five properties right away. And then I've just been trying to add to my portfolio slowly as I can. One thing I will say, Greg, I was one of your calls for Hurricane Milton. I was one of the 20, my brand new house that I just bought the tenant called because the neighbor's tree limb fell in their side yard.
Gregg Cohen:Oh, it fell in their yard.
Leslie Wilson:Yeah. So they called JWB to say, Hey, there's this limb. There was no damage to the house, but that was one of the calls.
Gregg Cohen:Good, good, good. Well, Hey, listen, I'm glad that the residents are calling. That's a, that's a good sign. And when they're major problems, when they're relatively minor problems, a good phone call is, is always a good thing. And I'm glad there were no maintenance issues for you. It's
Leslie Wilson:a proactive tenant, which I'm very grateful for. We want the ones that will call and let you know what's going on. Exactly.
Pablo Gonzalez:I thought there was a lot there, Leslie? Yeah, with, I, I wrote a full page
Gregg Cohen:of notes, but I'll back. Just so saying as you're seeing me here. Yeah.
Pablo Gonzalez:You know, the first thing that's, that's outstanding, you know, that sticks out to me is just like, man, I didn't realize that you didn't start investing here until, until we started the night, your average investor show. For whatever reason. I thought that you had been kind of like investing with JWB since like 2014 and stuff like that. And, uh, I was scared. Yeah, yeah, yeah. That makes sense. talk to me about that, right? Like talk to me about the, was it, was it the fear? Cause we talk a lot about on the show of, you know, you, you go to do real estate, you might do it in a non vertical integrated way, right? Like you set yourself to have an education like you did in Detroit, but what went What went wrong in those Detroit properties and those Phoenix properties that, that made you be scared of, of moving forward and doing more of that stuff?
Leslie Wilson:Because there is a tendency to try to expand where you've already invested. And with Detroit, the houses are cheap.
Pablo Gonzalez:Yeah.
Leslie Wilson:I was picking up houses, three bedroom and the tradition in Detroit is one bath. Whereas here in Colorado, you've got to have that second bath. But in Detroit, they're fine with waiting in line to go to the bathroom, I think. So the standard is three bedroom, one bath. And I was like, okay, fine. And I could buy them for 60, 000.
GMT20241015-163245_Recording_1292x720:Yeah,
Leslie Wilson:you can't get a tough shed in your backyard for that here in Colorado. So, the thing that I had never heard about was this wholesale market where the cash flows are like 10%, 15 percent a month. That sounds very attractive, but the downside to that is your home pretty much stays valued at 60, 000. And you practically with every turnover, you have to rebuild the house because the tenants are just, they live roughly and It's a culture, quite honestly, that I don't understand very well. And the one nice thing about investing in rental real estate is there's a thousand in one ways to make money. And just because what works for me might not work for you, or you might have something that you like better. I really love the three bedroom, two bath rental, and I absolutely love JB JW B's product of the Ranch style. Three bedroom, two bath rental because as I've gotten older, the knees are getting creakier and having a ranch style home is a very nice thing that it will appeal to the broadest market. Handicapped people love it. Old people like it. Young people like it. I also like the culture of the tenants that J. W. B. Works with in that they've grown up in these neighborhoods that J. W. B. invests in. That's not the situation here in Colorado, where you have a majority of people who have moved here from other states. So. There's a lot of, demographic mix in Jacksonville, a lot of diversity in the employment base. What you don't want is a boom bust state. In Phoenix, they took off in the eighties because of the semiconductor industry. That's what brought me there. And that's what fueled a lot of their growth. But as Time went on and they started offshoring semiconductor manufacturing to Taiwan and other areas. The demand for that housing went into a bust situation. So those are just some things to keep an eye on, but those are the demographic things that I think speak well for Jacksonville because you have that Amazon headquarters there, the military. You also have that investment in downtown Jacksonville. I thought it was very interesting. The history of downtown being so owned by the Southern Baptist church. And now they're starting to sell these things. One of the big stories in Denver was our downtown was a slum. It was skid row. All the drunks were down there. The homeless. And then all of a sudden the city council said, you know, I think we'll build a brand new baseball stadium in this area. And people thought, what are you crazy? The suburbs were like, but the people who go to the baseball game are out here.
GMT20241015-163245_Recording_1292x720:The
Leslie Wilson:city council said, no, we think we're going to build it here. And it was just like that movie field of dreams. If you build it, they will come. So I'm very excited to see the revitalization that I know will happen in Jacksonville, just like it happened in Denver. And those are the bigger picture kind of things that I think as a real estate investor, you need to pay attention to.
Gregg Cohen:Leslie, you are just amazing in so many ways, shapes and forms. And I, you know, and I just love speaking to you because as I'm listening to all of these learning lessons that you've been through, I'm just thinking how courageous you are to get started in real estate takes a lot of courage. To stub your toe a couple of times and then get back on the horse takes a lot of courage. And there are so many learning lessons. I think you have gone from a place of kind of like, we'll just call it raw courage in the beginning with you stepping in and, and helping your friend out and becoming that first accidental landlord. To now it is strategic. It's strategic in the market. It's strategic with the team. It's strategic in the type of housing that you have found to be very successful. And also strategic with the type of renters that you're finding that are going to be successful. Strategic about the jobs, the economics. You're strategic about downtown. So I've got, I've got a bunch that we can talk to, talk about. Um, but first I wanted to ride this train about Because it is sometimes feels like I'm, I'm sharing this vision to a deaf audience sometimes when we're talking about how important I
Leslie Wilson:was listening, hitching,
Gregg Cohen:hitching your wagon to a successful downtown is as an owner of single family rental properties. Because. You know, people talk often about how I want to buy a single family rental property, but I want it to be next to that supermarket that I really like, or that shopping center that I really like, or something along those lines. And what I keep saying to people is, Yeah, guys, I guess that makes sense. But if you really want to be in the path of progress, go find a revitalized downtown. So Leslie, I wanted, I wanted just to hear a little bit more about your experience and if you can relate it to what it's like to, to have owned properties surrounding downtown, what has happened to rents? What has happened to home prices surrounding downtown as well as median incomes and quality of life? Can you share a little bit more about that? so much. Because that's what's going to be happening in Jacksonville.
Leslie Wilson:Exactly. Well, when I first was transferred to Denver in 1998, they had really just started these conversions to lofts in these old warehouse buildings. And the loft would be like 300, 000. And I thought who, who would ever go down there now, those same lofts are a million and a half because there used to be in the training and forgive me for saying this, but they would say, find where the gay people want to live because they will go in and revitalize a neighborhood and make it hip. And a lot of the gay people were going in and fixing up these old homes and making them just cute and they were preserving them. And now, I mean, gay people can live everywhere now, so you don't have to follow that, but it was just kind of like looking at the bigger picture to see what the revitalization is. But I also think that you need to look at the demographic trends because young people like to live with other young people. Old people like to live with other old people. And my advice is look where the young people are going. And in Jacksonville, the young people, even some of the JWB employees, are going downtown. Because now you have more things to do than just go to a Southern Baptist church service.
Gregg Cohen:Exactly, exactly. I think it's go to a place where people are going to spend money. Because when people are going to spend money on housing and going out to bars and restaurants and those types of amenities, and young people tend to do that more often, that's where people are going to show up to receive that money in the form of businesses and more housing and mixed use. and it's just so wonderful. And they want to be close
Leslie Wilson:to where everything is going on. It's interesting, this new generation, because I'm a baby boomer, and we were raised to just. Nose to the grindstone, work hard, save your money, get that, you know, good, secure job and buy that house in the suburbs with your car. The new kids, they've been through some economic cycles. Maybe they've seen their parents go through foreclosure or a bankruptcy. And so they realize more, I think, than any other generation, how short life is. So what you'll see are these kids will spend more on experiences. than like buying the house. And there's always a reason that people rent. And a lot of times I want those people as my tenants because they never have trouble paying the rent. Or if they do, they'll just get a roommate.
Gregg Cohen:Interesting. I was just reading an article about, that's highlighting certain things that you're talking about here. And it's talking about home price affordability. It's a little bit of a segue from what we talked about last week, which is that, you know, median incomes are outpacing rents in Jacksonville over the last year. So, which I know home price affordability is a major concern for all of us, but that's a good sign that median incomes are outpacing rents for the last year because that means it becomes a little bit more affordable. And when you are in a place where median incomes are going to continue to rise, rents and home prices can still rise and people can afford them because median incomes go up. But what this was specifically talking about that's to what Leslie's saying is that There's a bifurcation when it comes to rent price affordability. And because more and more folks are choosing to rent that have higher incomes, over 75, 000, it's actually creating a renter class that is much, can't, that has, Much more ability to afford the rents now on the flip side those lower income rents have not the the incomes in the lower bifurcated section we'll say there Those have not been going up. So it's much more challenging for those who make low incomes to afford the rent So it's this isn't to say median incomes are going up across the board But what it's highlighting is what Leslie's talking about Because people are choosing to rent and they value experiences, they have the ability to rent, that these would make great renters for us in a downtown setting or somewhere around where amenities our house today and we'll be housed in the future. Is that kind of where you're going as well, Leslie?
Leslie Wilson:Well, what, what I found here in Denver was I used to promote, Hey, rent my house and you have the lock and leave lifestyle. And what happened during the downturn all over America is you had a bunch of people. Lose their job quickly and all of a sudden they had this mortgage and they were trying to find a new job But the problem was is maybe they had to change industries or move to a new city And a lot of the new jobs were in the southeast. They weren't here in the west And so what happened here in denver is those people became accidental landlords Where they would find somebody they would rent the house just for the mortgage payment just so they didn't have to take a loss Now, Denver's market snapped back really quickly. The downturn was only 18 months. There's some parts of America where they're still trying to get back to where they were before 2008. Like, and that's where you really have to pay attention to where the jobs are because that's where people are moving. And so when I would interview my tenants, when I was managing everything myself, I would say, why are you moving?
GMT20241015-163245_Recording_1292x720:Yeah,
Leslie Wilson:and the number one reason was well my landlord's selling the property And it was all the they called it the shadow market where all these accidental landlords were like, oh good We don't have to take a loss. Let's get out of this since we've moved to atlanta. We've moved to La or wherever they went and so That's been a difficult thing for the housing market because all those accidental landlords were my competition as well, even though I was doing this as My career, my vocation. And that's one thing I like about Jacksonville is that these are the tenants usually have grown up in these neighborhoods and they have a culture there that keeps them there. They appreciate it. They're aware of, of what the amenities are and the best amenity is a good neighbor.
Gregg Cohen:Yeah. Yeah.
Leslie Wilson:That's what we don't have in Detroit, unfortunately.
Pablo Gonzalez:Let's see, you mentioned something in there that is, is part of. Part of a reason why we wanted to talk to you here, but it's, you have made this your career, right? Like, I feel like I look around when you, whenever I get to talk to you, you're like, oh, yeah, well, I just finished this trip. And then I'm about to go on this other trip. So I got some time right now. So you're living that like super maximized out, like retired lifestyle early on already. Yeah. you figured it out. And that means that you don't have conventional sources of financing. Like most folks, like you've been creative about the way that you, you know, get your capital to invest in this stuff. And I want to talk to you about that, but I want to talk to you about it in relation to the most recent wave of properties that you bought, right? Like you were just talking about these macro conditions that you really like. That's what brought you here. First, you talked about the trust factor. Which was listening to the show, but I, I understand that you've picked up a couple of properties recently and before we get into like how you got the cash for it, why now, like why are, why are you buying, you know, back to the title of the show, like what is, what is it about right now that made you want to buy more properties as opposed to the ones that you were just already liquidating somewhere else?
Leslie Wilson:Well, I think the first thing, what I learned from Harry Dent, the demographer, is to look at each decade. And he talks about the cycles of business in a decade. And usually as you're approaching a new decade, the 80s, the 90s, the 2000s, the first two years. America usually goes into a recession because business are like, Oh, we have a new administration. We're not sure business does not like chaos and uncertainty. They like predictability. And so I'm always a little careful around the beginning of a new decade. Well now we're in a new decade, we're 2024. And that historically has been the go, go. appreciation time for the American economy. Now this year is a little different. We've got a really big election coming up and there is still a lot of uncertainty. But when I watch what the economic policies are in America and what the Fed has done, and you and Greg have been promoting, say, Hey, interest rates are going to come down. They're not always going to be this high. I responded to Greg's incentive to help people pay down their interest rate. And I, I was able to close this most recent purchase at five and a quarter percent. And that's the highest rental property interest rate that I have. Most of mine are like three and a half. 4. 25 So it was just a nice enough of a nudge to say okay And how I financed this is I took out a home equity line of credit Because my house in denver is appreciated so much. I often refer to that Excess value as dead equity. So I always want to keep it working So I took a home equity line of credit and i'm paying six point two five percent on that So I went and got the down payment there And then greg introduced me to patriot lending where they had a new product where you can Finance the property based on the financials of that property because I've been doing this as my vocation. My tax returns like two inches thick. I have to have a schedule E for every single property and to go through a traditional mortgage, which that's the only mortgage I've ever done because I'm really cheap when it comes to interest rates. It takes them like 30 days, even to put me into the computer. And a lot of times they discount the rental income you have. It's a hassle. Well, then this year I struggled because my accountant hadn't finished up my 2023 tax return. So I was kind of prevented from jumping in and Patriot Lending said, Leslie, don't even bother with those tax returns. So it really, I was able to close within 30 days. So it made it really smooth. And the other thing is that I was able to close in an LLC, which in traditional financing, you're not able to do. And so that also was attractive to me to do a little asset protection as well as get another rental property.
Gregg Cohen:Amazing. So many things that I think people would love to learn more about just in that sentence right
Pablo Gonzalez:there. Before you go, I want you to teach, but I also just, I know that there's a lot of folks, like for me, a lot of that goes over my head. Yeah. Right. I was going to ask her that. And I know you're going to break some of that down. I just want to say that the easy button is, what you heard is essentially, there is certain products that most people don't know about as far as like lending goes. There's certain mechanisms that you can tap into, and the JWB team is an expert at that, right? So that's why we have that number on that screen, that 904 293 0341. You know, this is, this is that call to action of like, you know, Leslie just painted a really pretty picture of macroeconomic factors, these other things that are happening here locally as well, and then all these opportunities that most people don't realize they have access to. So if you have a question on how this might work for you, that you're not so sure, you Go ahead and, and, and text 9042930341, ask that question and they can just kind of get you started on that. But GC, why don't you
Gregg Cohen:Well said, and I should also point out, and Leslie, I'm sure would agree. You know, Leslie's sitting here now and she owns seven, seven properties now with JWB, right, Leslie,
GMT20241015-163245_Recording_1292x720:seven
Gregg Cohen:properties, right? And she was able to add more and there's, you can see that there's challenges. There's challenges with banks don't understand how rental properties actually produce income, which is try explaining that to a bank. They don't get it. so there's all these challenges. Leslie didn't come to JWB, especially on this last purchase and say, Oh, I know exactly what I'm going to do. I'm going to do this DSCR product. I'm going to close in an LLC. I'm going to do this, do that, do this. She just, she just called up JWB and we have a wonderful relationship. And she said, I'm ready to move. I understand this is a good time for me to buy. What do I do? And so for anybody who is kind of in that spot where you're like, I know I want to do this, but I don't know how to do it. That's when you should text that number. Yeah, that's exactly what Leslie was. And then through this conversation, we're gonna able be able to help you do that with, is that pretty accurate, Leslie?
Leslie Wilson:Yeah. And the call is free. You don't charge.
Gregg Cohen:Right. Right, right. So there were a couple of things that I think people at first glance say, whoa, I don't know if I want to do that. So I wanted to dive a little bit into it a couple of times. So you had two, and this was going from your Denver properties. And I believe your primary residence as well, two rentals in Denver. I believe you did a cash out refinance for both of those as well as the primary. So you took out more debt. And one of the scariest things for people to do is to take out debt on their primary residence to use it for investment purposes. But you are comfortable doing that. Can you talk to people who say, who would say to you, I would never do that and explain why it makes sense for you to do that and potentially help others?
Leslie Wilson:I think the most important lesson I learned was there's different kinds of debt. Debt is not all one thing. There's good debt and there's bad debt. It's still called debt. So, taking out a home equity line of credit to take a fancy vacation, to buy a depreciating asset like a car, that's bad debt. Taking out a home equity line of credit to invest in good debt, which would be an appreciating rental property in Jacksonville, Florida, that will just grow over time. So that was the first thing that I had to learn of not all debt is created equal. You also hear that, Oh, I just want to be debt free. And I experienced that, in 2010, I paid off every mortgage because my father had passed away and I'd loaded him up with life insurance. So I received an inheritance that was tax free. So I paid off everything and thought, Oh, I'm grieving. I had taken care of him the last seven years of his life. I was exhausted. He had dementia. So I just wanted to like sit for a minute. Then I got my federal income tax bill and it was the highest that I'd ever paid. And I was like, Oh my God, what did I just do? I got rid of all my deductions. So the first thing I did was start getting mortgages again. So what you have to pay attention to is the spread. Are you able to access capital in a way that is lower than the return on what you invested in? A Automobile depreciates. There is no return on investment unless you're really smart about cars and can collect them and buy low, sell high. That's not me, but with rental real estate, and especially Greg teaches the five different ways to make money on a rental property, I think those odds are pretty good. A lot of people are scared of real estate cause they think it's risky, but I tell you, I get great enjoyment driving by my properties and just saying hello to my money. Because I can see it. It doesn't move so fast like the stock market does where one day it's crashed and the next day it's up. It was driving me crazy. So at least with real estate, it's steady Freddy. And for me, that's what, what wins the game.
Gregg Cohen:Beautiful. Beautiful. I mean, I think, There's so much knowledge wrapped up in that right there. If folks haven't heard this before, go listen to that again on replay, just that right there. Because if you can understand how debt is an asset, debt can be an asset and also be a liability. People, most, most people understand that, but it can be an asset. And if you have the opportunity to earn a great risk adjusted return of let's say 10 to 11%, which is what JWB rental properties are producing and you have the opportunity to borrow it at. Five and a quarter percent, like Leslie did, she's excited, she can't wait to take out that debt. And if you start to train your mind that way, and you do, and you practice this for years, you will wind up one day in the not too distant future, just like Leslie here, controlling your time, taking vacations, and then sharing her knowledge with everybody else. Love it.
Pablo Gonzalez:Speaking of sharing knowledge, Leslie, we have a question here from an anonymous attendee saying, Leslie, are you considered a real estate professional? If so, do you have a realtor license? How do you maintain your license? You mentioned huge savings on your taxes, but that hasn't been my experience. Any advice you got there?
Leslie Wilson:So the first thing, the first difference is that I am not considered a real estate professional because even though I do this for Full time it's passive income. So you make your money in real estate on the buy side You make your money as a real estate investor Not as a realtor or a real estate agent The real estate agent is the person that goes around and earns commissions for buying and selling real estate. I don't do that I I want to have a good team on my side who will, and I'm gladly happy to pay good commissions for good deals, good properties. So I don't, and also with a real estate professional designation, which is an IRS designation, you end up having to pay ordinary income on the, income that you receive from real estate. So I definitely don't want to be categorized as a real estate professional. I am a real estate investor. I hope that
Gregg Cohen:that designation
Leslie Wilson:helps.
Gregg Cohen:And this is kind of a tough topic to help people understand in a relatively short timeframe, but well, Leslie is, I'll just provide a little bit of color. She has made it to this beautiful place where her income that has earned is passive. And her losses are passive. And so, when you are able to, and the beautiful thing is where she generates majority of her income is from rental property investments, which are amazing from a tax advantaged perspective for writing off passive gains. So her passive losses are taking care of her passive gains and she's able to live a very tax advantaged lifestyle. She doesn't have active income, or a lot of it, it doesn't sound like any. Thank you. So, yeah, and that's a beautiful thing. I think some people think, oh, wow, that might be a bad, that's amazing. I, we, if we could all get to Leslie's place you know, we, we could all, if you afford a few more trips, to be quite honest, and you're doing it in a, in a, in the way that the tax code is designed. so that's fantastic. The reason why you might not be receiving those anonymous attendee is because, You're talking about receiving active income and you're trying to write that off with passive losses and it doesn't work that way. And if you want more information on that, you'll probably want to talk to a CPA about active versus passive. I
Leslie Wilson:mean, the only deduction they really would get would be the depreciation deduction
GMT20241015-163245_Recording_1292x720:on
Leslie Wilson:the physical house. And depending on the income stream, I mean, there's, there's gains to be have by understanding the U S tax code and understanding what is the preferred way to do things and how to set up your, your business, but I get paid once a month when my tenants pay my income. And then the first bill I pay is to the bank, the mortgage. And then the rest is all gravy. So I get to travel around.
Gregg Cohen:Oh yeah. And by the way, when she refinanced those properties to pull that cash out, she decided to make additional investments. How much did you pay on taxes on the refinanced amount? You know, Leslie?
Leslie Wilson:Not much because you can deduct the points that you pay. You pay. Yeah. I haven't done it for this year, but when I paid off all my mortgages, I think my federal tax bill was like 15 grand. Okay. And now my federal tax bill's like two grand.'cause I have so many deductions.
GMT20241015-163245_Recording_1292x720:Yeah. And I'm providing
Leslie Wilson:good housing for people and a great lifestyle for myself. Ah,
GMT20241015-163245_Recording_1292x720:and I didn't
Leslie Wilson:really understand. I didn't really understand about being financially free until I did the Cashflow Game by Robert Kiyosaki, where you take your average bills. And if you can generate enough passive income to pay those, so you don't have to get out of bed every day and go to a job to pay those bills, then you get back your time, which is the most valuable thing any of us have.
Pablo Gonzalez:That's can't say it better than, than that. And Leslie, I think to no surprise now, everybody's really curious about your investments there. You know, Shibu Joseph is asking what price point in Jacksonville have you bought these properties? They're asked, Priscilla's asking how many do you own? Are they all residential? They're around downtown. And this is the time on the show where we answer those questions. Greg has put together a little, a little review of your portfolio. Let's see. You ready to see it?
Gregg Cohen:I'm ready. All right. This is this is amazing. This is amazing. So thank you, Leslie, for being so open and sharing all of your knowledge. We're about to get into some real numbers here. So I always let people know that you should do your own due diligence. We're going to talk about expected returns. We're going to talk about actual returns on investment when it comes to Leslie's portfolio. Just know that any numbers we put in front of you. If I don't say that they're actual, then they're estimates. And they're not guaranteed. They're subject to change. Just because Leslie's done quite well doesn't mean you're going to. So do your own due diligence. Be a big boy and be a big girl. And with that, let's dive right in.
Pablo Gonzalez:Leslie's story. All right, GC. Talk us through these right here. So
Gregg Cohen:this is Leslie's portfolio. This is six of her properties. Her most recent purchase just closed. How recent was the last closing, Leslie?
Leslie Wilson:45 days ago,
Gregg Cohen:45 days ago. So our, our reporting is updated quarterly. So the seventh property will be there, but you can see Leslie started in 2021. And, you know, Leslie, it looks like we closed in July, 2021 and then August and then October and then December. Did you make the decision right off the bat to buy those properties and they just have slightly delayed closings or how did it go about with the first decisions?
Leslie Wilson:Well, Greg, unfortunately, I wanted to buy them all at once. And at that time you said, let's just start with one and see how it goes. So that's what I did, even though I had all that refinance money in my bank account ready to go. Yeah. I just did it. I said that? I don't know if I heard. Once a month.
Gregg Cohen:I don't know. That must have been a bad day for me because I always believe in front loading it.
Leslie Wilson:It's different now. People can buy in groups now. But at that time, maybe because we were coming out of the pandemic, I was a new client. We were getting to know each other. We needed to date a little bit, I guess.
Gregg Cohen:Well, you know what it was? It was 2021. We sold 500 and 60 or so homes. And if we had had more inventory, we could have sold 1500. I mean, I think it was more
Leslie Wilson:a supply issue. You're right. It was a
Gregg Cohen:supply. So we actually had to limit homes for new clients to only one for a period of time, because we did prioritize current clients to be able to add their portfolios. The best way we knew how to take care of everybody. So yeah, that, that brings back some good memories. I'm glad we went down memory lane there because the strategy hasn't changed, but you know, that was, that was a The market has changed
Leslie Wilson:and the market will continue to change. So you need to pay attention. And that first property, Acorn, was one that you had personally owned, Greg. That's right. I know that one. you to offer up some of your own personal investments to share with your clients.
Gregg Cohen:Absolutely. And you know, I practice what, what I preach here. You 400 rental properties and then over time we, Sell some of those. We renovate those rental properties and then we sell those to our clients. And this one on Acorn is, is one of those examples right there, Leslie. And I know that one really well. I remember when we bought that one, that was, you know, I think we owned it for over 10 years. And so generally we'll season our homes, just like I share with all of you should buy and hold on for a full market cycle. But I know that one specifically because we go and we volunteer at different places in the community. I remember we volunteered right across the street from Acorn Street. We were doing a Habit Jacks, which is Habitat for Humanity in Jacksonville. We're doing a new build, and I remember looking at that one not too long ago.
Pablo Gonzalez:And just to answer a couple of the questions here in the Q& A from Shibu, who's asking, What are the price points in Jacksonville that you've bought these properties? As you can see, Shibu let's see about one for 127 and then the rest of them have been square in the two hundreds here, right? Which is pretty reflective of where the inventory is right now, somewhere between 225 to 265, something like that.
Leslie Wilson:Yeah. I would say one is the only resale property, all the rest. Well, no trout river is a resale, but all of those. Other than Acorn were the build to rent homes that JWB constructed.
Pablo Gonzalez:Got it. And then, and then what else we got here? How many properties do you own? Are they all residential? So yeah, these are all residential properties. These are all single family homes. She was asking all single family homes is around downtown Jacksonville or any suggestions. Yes. These zip codes that represent around downtown Jacksonville kind of looks like a, looks like a donut with downtown being the whole, all single family homes. And that is
Gregg Cohen:because YGC. Because if you want the greatest risk adjusted returns, buy single family homes surrounding a revitalizing downtown. There you go.
Pablo Gonzalez:And Priscilla, of course, was asking how long is the market cycle? I'm seeing people answer it in the chat already, but it's around 10 years, right? 10 to 20 years.
Gregg Cohen:10 to 20 years. Because if you look over history, the rates of appreciation are very close to what the historically accurate rate of appreciation is every 10 to 20 years. So if you know your market's going to appreciate at about 5%, And it's been that way for the last 40 years. What that means is over the next 10 to 20 years, you're probably going to see on average, it's going to be about 5 percent a year as well.
Pablo Gonzalez:Got it. Let's continue down this journey.
Gregg Cohen:So here's where it gets to be real fun. Leslie, I don't know if you've looked at your client ROI reporting lately, but did you know that you've earned over 380, 000 with your six JWB rental properties up to this point?
Leslie Wilson:I did, Greg.
Gregg Cohen:That's even better because sometimes people don't even look at the reporting. So I, you know what, I would have expected that with Leslie. Yeah, she's amazing. She's amazing. She already knew the numbers. You have received over 290, 000 in home price appreciation, over 48, 000 in principal pay down, over 6, 000 in tax savings, and over 37, 000 in net rental income. Your rates of return are tracking between 10 to 15%. So we are right in line to overperform on your portfolio. How does that make you feel?
Leslie Wilson:It makes me feel great. I want to buy more.
Pablo Gonzalez:Well, we can help you out with that.
Leslie Wilson:Okay.
Pablo Gonzalez:Well, to that, to that question, Perry Sherman is saying 2021 and just during and after COVID was a spectacular time to invest in real estate. Agreed. How does it look now though? Aren't things appreciated? How do you answer that question? Leslie about like, is the best of appreciation behind us already? How are things looking right now? What are you thinking about that?
Leslie Wilson:Well, you've got to pay attention to what the Fed is doing and they just started to cut interest rates. So there is a relationship between what you can buy a house for and what you have to pay on the mortgage. Most people, when they're in the housing market, they don't care about the purchase price of the home as much as they care about that monthly payment. And when the economy coming out of COVID was heating up and we had 9 percent inflation Everybody was in pain except for me because another benefit of a rental house Portfolio is an inflation hedge well, all my friends who had their money in the stock market and their Stocks were down and they were having to pay more at the grocery store I was sitting pretty because I could just raise the rents so I could keep an even relationship between what I have to pay And the income that I have, there's always more income than my bills. And that's very important to pay attention to. So right now you have the fed easing, which will boost the, the value of the home. So I think, and this is what Greg tried to help people see is don't wait until they start dropping interest rates, get in now so that when they do drop. The price will appreciate on my houses here in Denver, the highest, I think a house I bought for 115, 000 in the crash in 2011 the highest value was 520, 000. But when interest rates went up, people couldn't afford Zillow saying I could sell the same house. For 450, but I don't care because I'm living off of the rents. I don't really care what the purchase price of the house is because I'm investing in Jacksonville and I can buy two houses in Jacksonville, what I could buy one house for in Denver. So I get double the rents. in Jacksonville than what I could get here in Denver.
Gregg Cohen:A lot of good nuggets there. I think overall, anywhere you turn in this asset class, from my experience of investing for almost 20 years and for managing 1. 3 billion dollars in assets here in Jacksonville and every client story we get to share here, what you'll hear is that this asset class is resilient. You can say, this may happen, and then Leslie says, well, yeah, well, but that doesn't really matter to me because this is what my experience is. Or that may happen, or an eviction moratorium may happen, or this COVID may happen. And what you have seen is this asset class And it's not a coincidence. It's happened decade after decade after decade after decade. And it's because this asset class is a critical need. And so not sure who asked the question about where the market is. Perry, love that question. And Perry, I would encourage you to get on the phone with my team to have an even more in depth conversation. but we got to realize that, We got to, we got to separate the noise as far as what is going on. As far as people claiming that, you know, home prices are at their peak. And I, and Perry, I, if you can go back and watch one of the replays, I just broke down all of the naysayers and all the doom and gloom that has been in the real estate market by the talking head saying that this was going to be the next crash and home prices can't go up. And the reality is that. People who otherwise would have invested in rental properties over the last 10 years have lost millions of dollars in opportunity cost because they listened to the So the talking heads, you got to find experts. You got to find a community here. You got to find people like Leslie who have lived this experience. And what you'll find is that there's data behind the thoughts that we have on where the market's going. So Leslie shared that interest rates going down leads to asset prices going up. There's data to back that up and we know interest rates are going down and it's hard to
Leslie Wilson:be brave when everybody's saying, Oh my God, don't do that. When I, during the crash in Denver, I was the only one going in and buying bank owned properties. And people said, well, why don't you wait until the market calms down? And I thought, well, then they'll, they'll be more expensive. I'm buying them on sale now. So. It's, it takes some courage to go in and follow your gut on this. But when everybody's like telling you, remember before the housing bubble, everybody was in real estate and you could get a liar loan. All you had to do was fog a mirror. That's the time to be the seller. That's the time to take your chips off the table because that's where the stupid money is in there. You want to be smart. You want to be a contrarian to the market.
Gregg Cohen:You wanna be a, not your average investor? How about that? I'm not your average investor. Well, I can tell you that it took courage for Leslie to buy her latest property. She's a little bit more accustomed to it now. It always takes courage, but I can tell you it took courage to do it in 2022. Everybody was telling her the market was gonna crash. Then it took courage to do it in 2021. Everybody told her the market was gonna crash there as well. But, you know, courage mixed with, community. and education. And that's where you get to sit in Leslie's lead after so many years. Love it. We got a couple of
Leslie Wilson:Yeah, he's everything.
Pablo Gonzalez:Right? Right? Thank you. Thank you. Thank you. Agreed. This community is what's up. Speaking of community, we're going to answer a couple more questions here. But first, we want to show you the Pac Man, right? GC, what are we looking at here?
Gregg Cohen:So You know, Leslie obviously is very strategic in her real estate investments and she understands our strategy at JWB. She has, she has taken on this strategy. It's done wonderful things for her. And what I am talking about, the strategy simply comes down to all five profit centers working in cohesion. And when you subscribe to a theory like that, it's easy to say, You know what? I don't need to go and buy the wholesale property in a market like Detroit. I don't need to go and spend 60, 000 on a property over here. I'm going to get excited about spending 250 on a property in Jacksonville. And the reason is because when you manage money like I do, and when you see success stories like Leslie's, Here is how the money is made. It's this percentage return on investment by profit center breaks down four of the five profit centers. The only one I leave out is inflation, hedging, and profiting, because that one's a little complicated to calculate. So in all four profit centers, what we find is that this Pac Man symbol shows up each and every time we break a client portfolio down. What it shows you is that over the long haul, what you're going to find is that the biggest contributor to return on investment is home price appreciation. That's why the team and the market you choose is so important. The team, because the team needs to be there with you to make it enjoyable so that you last in this investment, you need to last 10 years or more. And the market is so important, obviously, because that drives Home price appreciation. And that is going to be the biggest way that we're able to make money for you. It's going to make net rental income and cashflow. And some of these bigger buzz words that regulatively novice investors tend to tend to flock to pale in comparison and Leslie, your experiences. Very much the same. About 75%. It's like a true Pac Man here. This is like 75%. This is the exact Pac Man. Yeah. We say 60 to 80 percent of your returns will come from home price appreciation. Leslie, you're another shining example of that happening.
Leslie Wilson:This is what gives me the confidence to go into debt to invest.
GMT20241015-163245_Recording_1292x720:Mm,
Leslie Wilson:just seeing that Pac-Man, because if, if you were to do the same graphic for my remaining two rentals that I have in Detroit, the net rental income would be most of the graph. The home price appreciation is tiny,
Gregg Cohen:and if it was a bar chart, it would be a much bigger bar in Jacksonville for total profits and be a much
Leslie Wilson:more exactly bar
Gregg Cohen:in Detroit.
Leslie Wilson:Exactly. Jacksonville is just a much better, more rounded market and your property management team is the best I've ever seen.
Gregg Cohen:I'm not going to say anything. I'm just going with that. I'm going to let that marinate. I love that right there. Speaking
Pablo Gonzalez:of which, maybe
Gregg Cohen:the reviewer too should say that, right? Yeah, how about that? That would be amazing. And thank you to all of you who are posting the reviews. I appreciate that. That's
Pablo Gonzalez:right. Some people do reviews. All right, let's, let's jam through a couple of questions here. Uh, Joel Stofa asks, has Leslie used an all in one loan HELOC on 80 percent of our properties? Is that what you used on your, uh, home line of credit?
Leslie Wilson:No, I just did a HELOC on my primary residence at a local credit union. I haven't found the team here in Denver to do those other kinds of products. So I pretty much kept every rental property separate as opposed to just wrapping them into a package. But I know that my portfolio is such now that I could do that. But usually you pay a little bit higher percent interest rate on those package. Deals than you do when it's just based on one property. And I told you, I'm cheap about those interest rates.
Pablo Gonzalez:As you should be. I love it. I love it. Shibu Joseph is asking, what is the usual turnaround time in Jacksonville for finding a qualified renter? So Shibu, first of all, she, she was new. I was asking about, you know, does JWB manage the home and find it? So I explained to Shibu that this is a total turnkey experience. You manage it for the life of it. You're buying these already cash flowing asset class. You're using the best property management company. Leslie has ever seen to, to manage it, which is JWB. And they talk you through the life of the investment for any renter or any investor like myself or Leslie, we have portfolio managers. The big thing Shibu is that. They maximize for residence stays. So, I think it's, what's your average residence stay? It's like four and a half years. Yeah. So four and a half years, cause they sign a minimum of three and two year leases. They have a 70 plus percent renewal rate. So the first thing is that they minimize the amount of time that you have turns. But second, as far as like the actual turnaround times, you see, what is it like?
Gregg Cohen:Well, first of all, all of the assets that we have for sale right now, all the investment properties, they're already rented. So it's like served up to you on a silver platter, meaning you close on the house and day one it's rented. Leslie, the most recent property that you closed on, was it rented day one?
Leslie Wilson:Yes, it was.
Gregg Cohen:There you go. And then as renters move on, eventually, not everybody's going to stay for forever. Right. Our team generally about 40 days from market to move in is our historical average. So just plan on about two months of downtime. After, let's say, an average of four and a half years of your renter renting from you, call it two months of downtime, and then you're right back into an average of four and a half years stay.
Pablo Gonzalez:There you go. Brian McKay, BJ McKay is asking, is the three bedroom, two bathroom still the sweet spot or is it changing?
Gregg Cohen:You know, Leslie, that was your sweet spot. Do you want to, do you want to share that one? I can share it from a JWB perspective.
Leslie Wilson:Well, I found that if I did a bigger home, like a five bedroom home, you're going to either get a ton of roommates or a huge family and they don't pay any more rent, not necessarily for a bigger home. Maybe couple hundred bucks a month difference. So I kind of, for myself, like the smaller home, because I felt like it maximized the return on the, the rent versus the purchase price of the home.
Gregg Cohen:Interesting. You know, and we sell homes Maybe as little as two bedroom homes to five bedroom homes. And what you're going to find with any of the JWB inventory is that we're going to make sure that that asset performs to the return on investment criteria and standards that we have. And so if that five bedroom home is going to perform to the same standards that Leslie saw on her investment purchase, it better have a elevated rent to price ratio because it's probably a bigger home. It's probably going to cost more. So we're only going to put an asset in front of you that subscribes to that return on investment criteria. We haven't seen anything from, bedroom counts to lead to higher vacancies, for a five bedroom home versus a four or a three or a two. We just haven't seen that. And that's largely because we stay in the same areas. We dominate the areas that we are a part of. We manage 6, 000 homes. And so, you know, it's easy for us to be able to fill a two bedroom home in a neighborhood or a five bedroom home in the neighborhood because we just know it so well. So I would say it's all about maintaining that standard and that threshold. And we're pretty agnostic when it comes to two to five bedroom homes, but we certainly place for clients, if they have a preference for three bedroom homes or four bedroom homes, hey, let's do it. That sounds great. And we're going to certainly kind of follow that on some of those items that are a little bit kind of preferential and not really material to the strategy. Leslie, we're going to show you three bedroom homes because we know, you
Pablo Gonzalez:know, you know, my lived experience has kind of, has kind of been, it's kind of been a little bit different than Leslie's, right? Like I have one three bedroom, one, I have one, three, two, and I have one, four, two. And my three, one may have fewer roommates, but it's had more maintenance. So it's had less cashflow while my four, two is a family that's been there for a long time. And it's also been the source of the greatest home price appreciation. I think just because since it's a bigger number, Then that number that gets multiplied in home price appreciation has been the bigger one. So I guess it's all, it's all within the range of the JWB, which decision of the asset, but like, it's funny how it kind of like shifts around a little bit here and there. Right.
Gregg Cohen:You know, and the thing is it's fun to look back and see which ones have performed better and which, you know, three, one versus four, two, you, we could talk about how, you know what, bigger homes tend to have higher maintenance costs because there's more square footage generally and, and all of that. So you, you could talk about that as well. And that's obviously planned for in the evaluations. You know, it's just what things do we know right off the bat that can either set you up for more success or less success? Those are the things that we're going to strategize around. And bedroom count is not. One of those things, right? We have thousands of success stories for two bedroom and three bedroom, one bath homes, and we have thousands of success stories for five and two. And you might have a really good example of a five bedroom, two bath home that works. And you might have one that it doesn't work. So that just goes into this portfolio mindset and buying and holding. And we know you're going to win over the long haul. If you do that, as long as kind of the, we get the strategic things, right? Strategic things would be team market neighborhood within the market. Yep. and the rest are a little bit of details.
Pablo Gonzalez:Love it, man. Tons of great questions today. Just really encouraged by like Shibu's curiosity, Priscilla's curiosity, Perry's curiosity, really, really great time to just hit that text, shoot, shoot Tara an email, a text at 904 293 0341. Whatever question you have, they can just kind of talk you through next steps, right? Like Leslie said, it's totally free to get on with JWB. Find out, you know, like what you need to know about real estate investing, build that plan of what it would look like for you. It's a totally free service. Just to see what that type of like different retirement looks like. Finally, Laura McElroy says, if you buy now, if, and when the interest rate drops further, then you refi of best. If you wait till interest rates drop, more people will be buying and home prices will increase because of competition. And you will have lost that equity that already builds in from like that appreciation, right? We've talked about that a lot. Uh, Leslie, you're awesome. I think that goes without saying you have brought a whole bunch of people to the call a bunch of great questions. Your story is incredible. Do you want to leave us with any kind of like parting, parting thoughts of what you're thinking about why you're doing this, the type of advice you normally give to people when everybody finds out that you're a real estate investor that travels all the time with a bunch of friends?
Leslie Wilson:Well, I would say if you can overcome your fears and just reach out there's no sales pressure. You know, JWB is a very patient. If it takes you six months, attend these podcasts cause they will build your knowledge base and your confidence level and just get in the game. it'll provide you a really nice retirement.
Gregg Cohen:Yeah, Leslie, I've just really enjoyed our conversation. I've enjoyed our friendship over the years now. Every time we get to hang out, you're just so wonderful. But I've really super enjoyed this conversation. I feel like there have been so many messages that I have learned along the way that I'm really passionate about sharing. And I feel like you've had a similar journey. and so I wanted to say For, uh, putting your trust in us here at JWB, it's been a pleasure to serve you, but just thanks for being loud on some of these things and for getting here and sharing and helping others because there's so much that we can do collectively good in this country if we can help people get their money right, you know, and you can get your money right with single family rental properties and you're a great example of that. So
Leslie Wilson:Everybody needs a place to live. They don't necessarily need a place to work.
Pablo Gonzalez:Another, there's another little nugget by the maiden right there. Let's see. I echo everything that Greg says. I think every time that I've hung out with you, it's just been awesome. You're always so like, you're just so smart and so well spoken and you explain stuff in like, in like really easy to understand fashions. And it's really, really awesome. So not surprised so many people showed up, not surprised you're getting a bunch of love in the chat here. And never, never goes without notice that the 90 or so folks that took an hour of their day on a Tuesday to come hang out with us. I appreciate that. You really make this show special. You make the community special. Speaking of being smart with your money next week, we are talking about tax savings and why it makes sense to invest before November, right? Like during November and, and getting that ball rolling. So you can get your tax savings by the end of the year. I know that is To say that Greg is a tax aficionado and to say that taxes make you happy is one of the biggest understatements that I would, that would, that one could say. So it's going to get nerdy, but it's a lot of really good information and it's really good information for anybody that's like on the fence of like, should I buy now or not because of the advantages that you get to have by locking it in before the end of the year. So we hope to see you then. And from now till then, Leslie, any bit of advice for the folks until next Tuesday when they join us.
Leslie Wilson:Don't be average. Don't be average. See y'all Tuesday.