I Went From 1 Condo to 9 Rental Properties After Doing THIS
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- čas přidán 28. 06. 2024
- Chris Lopez turned $0 into a four-unit rental property. Sounds unreal, right? What if we told you that after that, he grew his portfolio to nine properties, built four businesses, and now collects over $100M annually? If you stick around, you’ll hear the exact concept Chris discovered that led to this massive growth and how you can use it to build a rental property portfolio that sets you financially free!
We always hear about ROI (return on investment), cash flow, cash on cash return, and other metrics used by the investing masses. The problem? These don’t give you a clear indicator of whether or not your money could be used in a better way. Chris used an often-untouched calculation to turn his single condo into a cash-flowing four-unit property that pays him more than FIVE times the rent. And if you’ve bought a property over the past few years, you could use this same strategy to multiply your rental portfolio faster than you thought.
Want to play real-life Monopoly and collect even more cash flow? Then, stick around! Chris will share the exact plan that took him to financial freedom!
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Cash Flow IS NOT the Key and Why ROE Beats ROI:
• Cash Flow IS NOT the K...
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A WAY Better Metric than Cash on Cash Return:
• A WAY Better Metric th...
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00:00 $10K to 9 Properties!
01:38 Almost Broke After Business Success
03:28 The $10K/Month Plan
05:35 Making an "Infinite" Return
11:47 Real-Life Monopoly
15:12 Steal My Plan!
As a Finance MBA I have to say that this is a much watch video for anyone that has owned an investment property for 2+ years and is focused on equity/wealth growth. Return on Equity is the #1 metric to measure and is often times forgotten about. Thanks for the reminder and simple overview.
Thank you! Yea it’s a powerful concept. Took me a long time to figure out
Step 1 - learn about real estate
Step 2 - something something
Step 3 - profit!
😂
😂
That’s what I gathered 😅
I did that step but missing profit part..
😂
you completely skipped the important stuff, you had 87% of your house paid off in supposedly 4 years, you weren't clear on that, then sure, you had plenty of equity for a 1031 exchange, which btw you skipped realtor / title fees etc to list it... this video is why people get in trouble in real estate...
It’s hard to go into every detail in a video. The few percent in transactions costs are pretty insignificant. Happy to share any details you want
1031ing into a higher cap rate property at a 25% down payment. Isn’t typically what causes people to get into trouble
The hour long underwriting videos out people to sleep!
@Chris Lopez those are my favorite. The underwriting and thought process, numbers, details.
@@BuildingWealthWithRealEstate actually these are the ones we need to see, they are the most important ones
Obviously there are fees throughout the real estate process. They can’t hold your hand and spend every video explaining every detail. Do some due diligence, it’s your investment after all.
Great simplified video on ROE. Thank you for the info.
You are welcome! Took my 6 Months to figure it out!
Great video! This really breaks it down for investors of all experience levels. Thanks Chris!
Great video, Chris. ROE is extremely important for people to understand...took me a long time to really understand and one thing that helped is just looking at it from the perspective of opportunity cost (seems like people generally understand that concept but rarely apply it to REI). In other words, the equity tied up in a property has an opportunity cost, so you should regularly (once/yr) be re-evaluating that property's performance from the perspective of opportunity cost (or in other words, would your money be working harder for you in some other way).
Another concept that you preach that you mention but gloss over is when you are regularly re-evaluating your property's performance, you need to look at it in today's numbers and answer the question: "would I re-buy this property today with these numbers?"...
Keep up the great work Chris!
in other words... make sure every dollar is working it's a$$ off for you!
well said!
We should add a metric "Return on headache too!"
Would love to see the extended version please
Super Great information! Thanks for sharing with BP community!
Thanks for this new information on ROE.
you're welcome!
Yes!
Please expand on the content of this video.
❤
ROE is an efficiency of capital metric but also is a risk measurement. High equity is low risk low return, low equity is often high risk, high return. So depending on how eager you are to grow, should determine your equity approach.
Yes. It depends what phase of life you're in: INCOME or GROWTH. I'm in growth, as are most people watching the video. I wanted growth. Always keep high cash reserve es to offset any bumps or crashes
I'm confused how you did $100m yearly from 9 properties and 4 businesses. It seems pretty vague. can you explain further details in the income from each business and real estate property. I somewhat understand you start small real estate and 1031 into bigger and bigger. I just dont get how you do $100m yearly.
I'll try my best to explain a CZcams comment. The goal of the video is to teach about ROE and how it helped me scale from 1-9 doors. I used the ROE concept and my ability to teach and model. to help others. Which drove a lot of biz growth and other opportunities.
The businesses are separate entities and income:
Brokerage - $100mm/yr in sales - the majority are investors. Every month I have clients optimize ROE. We do a lot of transactions in Colorado.
From the concepts and brokerage, that lead to being recruited as General Partner for capital raising in a RE Private Equity firm. In our first year, we raised about $40mm, with a lot of it coming from investors equities in their properties.
In fact, I had so much demand and interest from this concept, that we start building software 2.5 years ago to model (say bye bye to spreadsheets!)
🔥 🔥 🔥 content, much needed as I’m buying a 7unit thank you
Congrats!! 1031 exchange? Optimizing equity!?
@@BuildingWealthWithRealEstate neither, it's $130k purchase and has a valuation of $900k based on rents, but it's vacant currently so time to value add to raise rents!
@@realestateba nice! So you're creating it :) rock on!
Thanks for the information.
Would like a video on the 4 ways please!
Woohoo!!! Let’s do it!!
Appreciation, principle pay down, cashflow, and depreciation.
I like having just one maximum size property at any given time. Different locations more paperwork more overhead imo. Next step will end up being 2 fourplexes into a commercial 12+ units ideally.
Devi's advocate: I've had the same thought for efficiency and scale, but then no diversification. All the eggs are in one basket if something happens to property or specific neighborhood. How to balance that risk?
5:48 when he finally tells us
Great video. Thanks for the insight!
You contradict yourself when you say building equity is bad yet you use the NOI from your paid off properties to demonstrate how fast you scale.
I did the same thing when I was 22. Thank god for the Rich Dad book. Great video. I'm glad you clarified the difference between $10,000 a month (Gross) and $10,000 a month NET, spendable dollars!
Yes to RDPD. That booked changed my life! Didn't give the details, but changed my mindset
Very nice, I did the same thing only I was in debt when I started.
This is a great video, thank you for simplifying
I want a full video
Yes please make a video of the 4 way to make money in RS
Yes!!
4 ways to make money in real estate video PLEASE !
Great stuff Chris, you have an amazing story, and this story illustrates the power of 1031 and recycling capital to achieve an higher ROE
Real life monopoly - great way to explain it!
Great, thanks a lot.
You’re such a G, you just got my subscription.
Great video
that's thr first time I have hac ROE exolained that way,very eye opening.
Awesome! I'm glad to hear. It took me a long time to wrap my head around it.
Great video! And contrary to the nagative comments in here, you really encourage people to go study it more and more, and that this was just a quick video so you could start to grasp the concept. Keep up the good work!
Thank you! Glad you enjoyed it
🎉🎉🎉thanks
I'd love to see 4 ways to make money in RE.
Will start working on it with BP!
Good in theory. I need more nuts and bolts.
me too! :) Part of the game
Please expand and explain how you paid the principal off so quickly?
You could talk about how you bought your condo with 0% down?
How did you find a condo for 0% down???
It was a deal off the MLS. I had a private investor give me a 15 yr note at 5%. Combination of relationship and low yields at the time 2011 ish. Me and the condo were an attractive investment
Make a video breaking down the 4 revenue streams of real estate.
It's not Columbia it's Colombia.........jejejejejejejeje I saw that hat. Love it. Tuning in from Bogota. Cheers!
What did you pay for the 4 plexus?
Great video but I don't see how you count depreciation as income. Maybe if you calculated your tax savings per year because of the depreciation that could be counted as income. But you don't get a dollar-for-dollar tax-saving for depreciation it just lowers your taxable income. I could probably benefit from a more in-depth video on that topic.
Yes, that’s how you want to calculate. It’s the most complicated part of real estate. It’ll save you paying taxes,
Or if you do some advance strategies, you can get a tax refund with it. Look up the cost seg video with Yonah Weiss I did on here a year or two ago
@@BuildingWealthWithRealEstate thanks I'll check it out!
how did you put $0 down? And did you have to get a PMI?
I know that there are lending programs with banks that will allow you to get a property with 0 down and no PMI. Only certain properties in certain areas that are designated by the bank will be approved for that type of financing. Then typically one of the requirements is that you don’t own any other property.
Yeah lots of holes and confusion. I appreciate your enthusiasm though.
please go over how you bought your first deal with no down payment.
It was part luck, market conditions, and having wealth individuals TRUST me
It was an MLS deal. I couldn't get a traditional loan at the time. I started tapping into my network. An older, wealthier couple who wanted income jumped at at the chance. INCOME was their focus. At the time, bonds / CD's weren't paying much. a 5% return fro them on a real estate asset that was $200k 3 years before with someone they highly trusted (me), was a great investment for me.
It was all about finding a win/win..
FYI - this was the only deal I bought for $0 down. I'm not a creative finance buying guy
@@BuildingWealthWithRealEstate thank you for the information
Kind of vague in a few spots in this explanation.
What spots? Happy to fill in details. Hard to get everything in a CZcams video!
Yea I’ve taught this in the past, every detail usually loses people. I went for conceptual. What areas do you want more on?
@@BuildingWealthWithRealEstate I’m sure because I’m still new to this I also live in Denver and it just seems difficult here to get a deal like you have. It’s great content wouldn’t mind a longer video as well. Thanks for responding!
All good and dandy, but that "concept" won't work in Canada. There is no 1031 exchange here.
I have no idea about the rules up there. Hopefully someone can share insight
We want a Dedicated video 🙏
Great! I can’t wait to record!
Dedicated video please.
I have 2 rentals that I bought in the 2008/10 recession in Reno NV. $170k property with $40 down from my equity in my home. Now I want to invest $200k on 2 properties but the cheaper 3bed,2bat,2car is $340k in a minus fair shape 20 minutes out of the city & very little inventory. My payments would be around $2000 a month & the rent will be that much so no cash flow. Does not make $ sense. Those are real numbers & real reality here in Reno NV.
Hi what were your other business ? I’m new to this community . I have two businesses and one rental and a W-2 job. How do I get to 100million like you ? I need to set passive income goals, thank you .
I'm asking BP if I can do a full video on it. In our first recording, I tried to go into details on the business side too. but it turned into "a numbers soup" that even my own editing team couldn't figure out. haha
The ROE concept is one that very few investors understand. As an entrepreneur, I always look for ways to find untapped niches. ROE is a big one. I have a brokerage team in CO that does about $100mm a year in sales. The majority of transactions are investments, with many being equity optimization deals.
Once the light bulb went off, I started telling every investor I could connect with.
It buiild an amazing niche that lead me to building software to model it and becoming a General Partner in a RE Private Equity firm. We raised $40mm in our first year. With a lot coming from equity from rentals.
Good basic video. I just didn't see how the $0 turned into a 4-unit rental Property...
Good plan though...
I invested $0 into the condo.
After 7 years, the condo has $180,000 in equity (appreciation+ debt paydown)
I sold the condo to unlock the $180,000 to use as a 25% downpayment on.a fourplex.
I posted a lot of numbers above in another comment. Check those out
@Chris Lopez what was the loan length that there was so much equity in that period of time?
@@MeltingRubberZ28 0% down private loan at 5%, 15 year Amortization. About 35-40k from debt paydown. The rest from market appreciation. 2011-2018 period
@@BuildingWealthWithRealEstate appreciate the insight bud
You skipped the main thing….How did you find the property? 😊
ha! I debated not putting that in there. I wanted people to focus on ROE.
It was part luck, market conditions, and having wealthy individuals TRUST me
It was an MLS deal. I couldn't get a traditional loan at the time. I started tapping into my network. An older, wealthier couple who wanted income jumped at at the chance. INCOME was their focus. At the time, bonds / CD's weren't paying much. a 5% return fro them on a real estate asset that was $200k 3 years before with someone they highly trusted (me), was a great investment for me.
It was all about finding a win/win..
FYI - this was the only deal I bought for $0 down. I'm not a creative finance buying guy
Thank you! Awesome story!😊
Had me again on the title
The music is competing with the voice.
Thank You for expounding as he should have done!
Bigger Pockets shouldn't have allowed someone that is not telling all aspects.
Your video is not realistic. Most people cannot purchase any property with no money down. I'm done.
Foruntately the concept of ROE can be applied to any property you buy. The hard part IS just getting into your first property. But there are lot's of options out there to get into a property for very little down.I know Chris has had some clients get in for under 5k. So it IS possible. Don't get discouraged! :)
Karen, I understand it can seem unrealistic, but a lot of people routinely do if. My point in the video wasn’t to talk about the amazing deal… but that no matter how you buy, you always run into the ROE problem!
FYI since then I’ve bought zero properties with zero down. I got a little lucky on this one. Take it when you can.
Also a friendly suggestion, don’t close off your mindset to finding amazing deals!
I am not a fan of this video. Why would you just not get a heloc and keep your first place. This method assumes very good appreciation also. I think I will stick with commercial real estate.
appreciation aka inflation
they are not the same
You don’t know how hard it is to to get condo like the first your condo and you can pull out equity few years later.
Your a millionare but your wearing a t-shirt