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The Cam Lewis Show
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Everything a Beginner Needs to Know About Real Estate | Jason Kogok
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Jason has decades of knowledge in Real Estate Investing and as a Real Estate Agent, and shares his advice to the newer generation. Can't miss this one!
Hey everyone, welcome back to the episode today. Today we're here with a real special guest, Jason Kojak. He's a real estate agent, uh professor at NC State and investor, and more importantly, he's a mentor to me. So we're super excited to have you on today, Jason.
SPEAKER_01Yeah, I'm super excited to be here. Thanks for having me.
SPEAKER_00Yeah, so you came uh to uh North Carolina back in 2002, correct? That's right. Well what was your uh real estate origin story like?
SPEAKER_01Yeah, so um had graduated college in 02, um, and I had uh a brother that lived in Kerry at the time. Um had no ties to Maryland anymore, and I had wanted to get into real estate investing and actually kind of renovation and construction. So uh decided to make the move down here. Um simultaneously, I had an old college roommate that had gotten a job in Greensboro. So I lived in Greensboro for about six months, uh, got my real estate license and just waited tables, um, and then decided to make the move to Raleigh. Um, when I made the move to Raleigh, my brother who was here had got a job transfer. So I was kind of here solo and decided that in order for me to be able to invest and do those type of things, I had to have good income. Yep. And so my real estate kind of career started um in that way, doing sales.
SPEAKER_00Yeah. And then so when did you end up getting your first investment? I mean, how long did that take you to achieve that goal?
SPEAKER_01Um, so my first investment was my first house. Um, and I lived in it for 11 months. So I, you know, it it I knew my strategy would be buy a primary residence, maybe grab some roommates um and try to rinse and repeat that. So um I bought my first house um almost the following year, so 2023, May of 2023, I bought my first house. Um, it needed a lot of work. It was uh it was a foreclosure, um, was pretty nasty, um, but not nasty enough for a single guy right out of college. Um and so yeah, lived in it for 11 months, did get one roommate, and then um moved out of that house, bought another house, and turned that first house into a rental.
SPEAKER_00So you're doing what they call house hacking, correct?
SPEAKER_01Yeah, yeah, yeah, yeah. And and back then we didn't really call it house hacking. It was kind of just the way that most people started, right? You you got a roommate to help pay the bills. Um, and and similar to what a lot of people have to do today, we just have a term for it now. Um, and you kind of understand the tax code and the lending rules, and you just apply that and and kind of rinse and repeat. So yeah, it wasn't that tough.
SPEAKER_00There you go. Well, well, and that most agents don't even become investors. I mean, when did you realize that you were starting to build something bigger? Um, I think so.
SPEAKER_01When I bought my second house, my my second house needed a ton of work. Um and um and that's after I kind of was on the tail end of doing that work, that's where I think it clicked because I had some equity in the first house by then by fixing it up. I was getting a little bit of rental income, nothing to write home about, but it the bills were being covered. Um, and then I had this other house, the second house, and I and and that's where I think I started to see like, wait a minute, I I can kind of do this. Um, I can do it and still have my real estate career. Um and so yeah, I think I think probably by 2000, late 2004, early 2005, uh it started to kind of the dots started to connect um that I could I could probably pull something together here.
SPEAKER_00Yeah, and I guess if it wasn't the term house hacking back then, I mean, how did you find out about it? Did you have early mentors?
SPEAKER_01No, actually, yeah. I mean, the you know, the idea of mentors is something that I feel like is was not necessarily around. Um, I mean, obviously there was mentors, but it just wasn't, you know, I think nowadays we throw the term mentor around quite a bit, um, which is fine. There's a lot of people kind of helping the next generation. But back then it was more maybe somebody you knew, it could have been a parent, um, you know, that kind of gave you some advice um or somebody that was already in the business. I was I was lucky when I started in the business, I had linked up um with a lender. Um, and you know, and that's a that's a natural progression. A lot of lenders and brokers try to connect to kind of do business and serve mutual clients. And the lender that I linked up with um was probably 15 years older than I was at the time and had a lot more experience. And and he would take me out for coffee and and he would kind of really help me understand I think what being a professional was and and how to kind of and how to grow. So so yeah, so uh his name was Scott Corbin. Um I I I saw Scott not too long ago. He might not even know that he that he did that for me, you know. Um, but yeah, so that helped me quite a bit, I think, in in understanding the money aspect, the lending, because that's the hardest part.
SPEAKER_00Yep. Yeah. Um, I guess besides maybe the money aspect, if you could go back to yourself on day one, what what would you maybe tell yourself or warn yourself about?
SPEAKER_01I would tell myself to probably grow faster and and really understand leverage and taxes better. Um that's that's probably the one like great thing about real estate is the ability to leverage. You know, I can put down $100,000 and buy a half a million dollar asset. Um, and so that ability to leverage uh is something that I've learned later in life. And then the the taxes, right? Giving, you know, 30%, 35% to the IRS is a stinger each and every time. And so I think for me, if I could go back and and start over, it would be tracking and building a portfolio um with real intention. Back then it was kind of what's next, like haphazard. Like, okay, that one worked. Okay, let me do this. And and I didn't really have a plan. And I think I spent a lot of time figuring that out before I realized it's not gonna happen without a plan.
SPEAKER_00Yeah. Yeah. Yeah, I feel like that's something that a lot of people run into.
SPEAKER_01Yeah, it's it's it's it's really easy to do if you start making a few bucks and you start to have a little bit of success. Um, it's it can be natural to think the success is because something you did. Right. And and some of it will be, of course, but you know, I had just when I started investing, we had just come out of the tech bubble. So um, you know, a lot of internet companies had gotten really big and then imploded. And so we had, you know, layoffs. And so the market, I had accidentally walked into a decent market. Um, and we had a couple years of a good run there before we had our 08 financial crisis. And so from 2004 to 2007-ish, there's a three-year period there where like things were just working, and you start to think, oh man, I've got this down. Yep. And you don't you don't give enough credit to how much the market was helping your success until the market hinders your success.
SPEAKER_00Do you think the market's a lot more competitive today than than it was back then? Oh, yeah.
SPEAKER_01Yeah, yeah. I mean, and I think that is attributed to just the sheer amount of information out there. Um, if you wanted to get into real estate investing when I started in Raleigh, I won't say there was a handful of people doing it, but there was a handful of people that were really making an impact. Everybody else was like myself, mom and pop, snagging a house here and there. And it was really done as, for the most part, supplemental income and and growth. It wasn't necessarily a career path. Um, but now, I mean, you could pop on YouTube and you could own it all. Oh my gosh. Yeah. I mean, you could some of it honestly it creates though pre paralysis by analysis. There's so much information out there. And, you know, one guy might be successful at this, and and one woman might be successful at that. And so you try to do it all, and that's a recipe for probably not doing any of them well. Um, so as I've gotten older, I've gotten a little bit better about picking my lane.
SPEAKER_00Yeah. Smart way to do it. And curious, if you are finding a house that looks like it makes sense out there, you know, you do long-term holds, Airbnb's, fix and flips. Yeah. How do you determine the criteria for you know what you're gonna do with with said house?
SPEAKER_01Yeah, so it used to be all money driven. Um, it used to be all, well, what what gives me the highest rate of return or what position am I am I in in my life? Do I need capital or am I okay on capital? Um, you know, do I want to fix up a house that should be a flip? And then I put a tenant in there, and then in five years, I'm gonna sell it and fix it back up, right? So some of that is is in there. But now at the stage I'm at in life, I'm now I'm way more focused on long-term wealth. And so for me, if I'm getting an asset in an area that I really want to hold and something I plan to give to my children, even if it needs a lot of work, I'm probably gonna hold on to it. Right. Um, and the money item will come second. Yeah. Right now I'm in the phase of I want to accumulate class A properties that will support me and my family through retirement and then hopefully give them to my children. Um, so now that's not to say if I found a great one in that area, I wouldn't flip it. It's just money is kind of sitting second in those decisions.
SPEAKER_00And would you recommend uh that kind of investment strategy to someone, you know, I guess in their 20s, or is that different?
SPEAKER_01Well, it's different because my first house was $89,000. Yeah. Um, you know, and it was in Raleigh. Um, and my second house was in five points, and I bought it for $170,000. So the game has changed, just you know, what I needed to make, and that was at a you know, my first interest rate was 6.4. So now we're at, you know, maybe six and a half. So we're at similar rates, but you're talking about four times the price. So what I needed to qualify for, it was just a different ball game than uh, you know, a lot of people that are getting started. So yes, it would still be the the plan of attack, um, but it would just take me longer to get started. I think I would have to save more. I have to get, you know, when I in my first house, I had a roommate. Uh, you might need two or three roommates now. Um, can it be done? For sure. Um, maybe it takes you to your 25 or your 30. That's fine. Yeah, I think sometimes people rush, or or it's like, you know, they get out of school and then the immediate question everybody asks you is what's next? What's next? And it's like, take a beat, right? Like, okay, if I'm if I'm 20, 25, and I've got potentially 40 years, I've got four decades ahead of me of whatever my career looks like, take a beat, you know, and and and and so I think if you get started at 30, that's fine. I see a lot of people get started by taking more risk, highly leveraged, thinking the market's never gonna change, all of these things. And the market changes 10%, and then you're upside down, and and then it gives you a bad taste in your mouth. And so then you get to 25 and you're like, I'm never touching that again because that was terrible. And it's like, oh man, you just you left potentially the next four decades over one bad experience. And and I think that's where sometimes people get kind of uh screwed up.
SPEAKER_00Yeah, well, on the other side, I mean, if that does happen to someone, I feel like you know, some people miss it as you have no choice but to get it back then. Yeah, two sides of the coin.
SPEAKER_01That's exactly right. Yeah, I mean, it you have to in in this particular industry, you have to have a certain risk threshold, right? It and it doesn't need to be obviously to the ceiling, but you have to have a certain risk threshold and you have to be able to accept that. I think that risk threshold though should be built over time. My first house that I bought was it was in tough shape, but at the end of the day, it was carpet, it was paint, it was renovating a bathroom, it wasn't adding an addition or ripping off roofs and all that, right? And I think sometimes people feel because of the way the world is, it's gotta be immediate and it's gotta be huge so I can tell my friends or post it on social media or whatever it happens to be. And it's like, no, take your single, take your money, and roll it into a double, and then roll it, you know, you'll have plenty of time to be like, look what I did.
SPEAKER_02Yeah.
SPEAKER_01Um, but I think sometimes people go out of that risk threshold and get themselves in trouble.
SPEAKER_00Well, curious, and I didn't know this about you until more recently, but you have your GC license, correct? Yep, I do. Why did you get it? And two, I assume I know why. How has that helped you determining, you know, the value of properties and how much work is going to go into them?
SPEAKER_01Yeah. So um I got it, I got it uh, geez, in 2010, I think. Um, so I've had it on you know 16 years now. I got it purely for to be able to pull permits myself on fixing flips. I was the only reason I got it. Um and and I really like construction, so I was like, well, this will be kind of cool to see what the test is like and and the prep and all that. Um I because I don't do construction day to day, I wouldn't say it makes some sort of massive impact, like, oh, I, you know, I don't know what a square roof is running right now, right? Or or a sheet of OSP. Um, because I'm not doing it every single day. Um, but it certainly helps with pooling permits, it helps with legitimate legitimate uh legitimacy. Um, it it helps with some of those things. Um and and now that I've got it, it's just something I'll take the continuing education and hopefully never give it up.
SPEAKER_00Yep. Yeah. Um curious too, and I know right now it's not a high interest rate environment, but in you know, environments like that, you've been through 2008 and you know, a couple situations such. Um, how does your criteria change? What is your strategy like when you're facing something like that? I mean, you are playing the long game now. Are you still buying? Are you hoping for that refinance down the road?
SPEAKER_01Yeah. Um, yeah, great question. I mean, so yes, I'm still I'm always a buyer. Um, but I could also be always a seller. Um, so but but yes, I am looking right now. My criteria change. So in in 2008, um I I don't remember how many houses I had. It might have been a half a dozen uh rentals at the time. So it wasn't anything crazy. I never really got to be a lot, but um what ended up happening was tenants were losing jobs. So tenants couldn't pay rent. Um so you kind of face this well, do I kick, do I kick, you know, Steve and Mary and their kid out of the house because they haven't paid rent. Um, and then I put it back up for rent. But at that time, it wasn't like there was a bunch of Steve and Marys behind that one to come and rent it. So you were then saying, gosh, I'm gonna sit on an empty house now where nobody's taking care of it. And is that what I want to do? And so during that time, one thing that that stayed kind of standard was that class A properties still sold. Now they sold for a discount. Don't get me wrong, they weren't selling at the same value. Um, but you know, near downtown, your five points, your boiling heights, you know, all of those areas where North Hills was not there yet, but it was starting to get a little bit of movement. And so one thing I noticed was like, wow, all of these class A properties still sell. Maybe take a haircut, but they're selling versus your class B, your class C, you're kind of your further out, they were getting just crushed, just at absolutely crushed. And there wasn't enough equity, and people were giving them up and et cetera, et cetera. So what the lesson I took out of that was it changed the type of properties. I said, okay, so I spent some time, a couple of years, unloading the properties that I felt like weren't my core assets. And my strategy has been since then, I'm gonna buy class A properties, even if I have to pay a premium for them. Because I'm in the long haul, um, while I would like to walk in and feel like there's money already built in, if there's not, I'm okay with it. Um, because five, 10, 15, 20 years from now, I'm hoping somebody will say, Oh, wow, I can't believe you bought that property for X. And it'll the interesting thing is, is when I bought it for X at that time, people may have said, I can't believe you paid X, like overpaid. Yeah. And so um, so yeah, it's changed how I how I look at properties. Um and I also view properties through the lens that you never get to pick the market that you sell it in. You think you will, but you don't. What ends up happening is usually you are selling through some sort of life event. Um people lose a job, people get divorced, family member passes away, family member gets sick. I gotta take care of mom and dad. Child needs a special need, whatever, right? There's all these life events that come at you and they don't send you an invitation before. Um, and so a lot of times people are forced, investors and homeowners, to sell at times that they never thought they would. 08 was a prime example of that. When we were in 06 and in early 07, none of us thought we're selling. The market was on fire holding this, holding it, right? Um, and then boom, almost overnight, that all changed through no control of our own. And so it definitely gave me a viewpoint that was like be prepared at all times. And so I don't, you know, all of my properties I take really good care of because I might have to sell them tomorrow. And so, yeah, just different tweaks that uh that really were learned during that time frame.
SPEAKER_00Yeah, and you have been investing for over two decades now, yes, which is awesome. Yeah, awesome for your portfolio, right?
SPEAKER_01Uh yeah, yeah. I made I've made my fair share of not the best moves, but yeah.
SPEAKER_00Well, you're still doing all right. You're playing for the long haul. I am, yeah. Ten years from now, I mean, you'll be approaching that point to where, hey, maybe some of your properties are paid off. And you know, what is that goal for you? Do you want to just have all your properties paid off, bringing in cash? Do you want to sell them for a lump sum? Like what's the optimal, you know, kind of ending there?
SPEAKER_01Yeah, so um, I'd say maybe close to 10 years ago, I made a decision that I was going to kind of assign a an end goal for each of my properties. So I I look at my portfolio as if I was building um a mutual fund full of stocks. And and so, you know, there are there's one or two houses that I will certainly tear down um and build probably a duplex with an ADU and keep it well into retirement. There's one or two that I'll probably sell, take the cash, and you know, my wife and I might, you know, move to the beach. And then there's some that I will leave for my children. Um, as of right now, I could tell you which of those properties are assigned that way. Yeah, of course, the market could change. Um, so yeah, so some I will hold for cash flow, some I will hold um for my children, some I will flip some, yeah. So there's a variety of of what and again, that's today. Yep, right.
SPEAKER_00So we'll we'll see what the future brings. So it's just being very diversified and seeing what now it has, yeah.
SPEAKER_01So again, you know, one of the things that I think as investors, we sometimes do a poor job at is we preach one thing, right? And it might usually it's cash flow. You know, what's your cash flow? What's your cash flow? And don't get me wrong, cash flow is critical to this business. If you don't have cash coming in, you'll you'll drown. Um, and so you there has to be cash flow, but sometimes when people focus solely on cash flow, they end up buying a crappy property, right? They're looking at it just through the lens of what does it show on my Excel sheet? Right. They're not even driving by the neighborhood or any of those things. And so um I think a really good investor obviously understands cash flow, but they're understanding the bigger picture, right? Appreciation, tax things, 1031. And then what am I gonna do with this property? If I have it as a 3-2 right now, does it have to be a 3-2 when I sell it? What's another option? Um, and so yeah, I think I've gotten personally a lot better at that over the past decade, and I think it's helped the portfolio.
SPEAKER_00Yeah, and curious. So, I mean, you invest solely in the Raleigh area, is that correct?
SPEAKER_01Yeah, yeah, yeah. I am um, and and and because I get asked that quite a bit. I am a strict Raleigh person and it's nothing against any other market. I I own a house, I mean, I own one in Kerry and one kind of towards Garner, but um yeah, I want to be an expert. I want to be an expert, and I want to be able to make a decision in like a second. And so for me, if you're within, you know, if you're within my five mile radius and a house pops up, I mean, I I could write an offer and write a sizable non-refundable check within 10 minutes. And that's because I'm an expert in my area. Now you take me 20 miles from here, and because I do real estate sales, I'm probably decent in that area, but I don't know if I'm writing a a six-figure non-refundable check in five or ten minutes. Yeah. And so um, it's limited the in the the inventory that's available to me because I've brought my my kind of sphere tighter. Um, but it's an area I believe in.
SPEAKER_00And and so yeah, uh, I'm willing to do that. Yeah. So that's what makes it harder for people like myself, I guess. Swimming with the sharks.
SPEAKER_01You you may be one in the local market because man, and there's well, I wish, I mean, I almost take it as a compliment, but there's there are yeah, the the pockets, you know, one of the things that that even I compete against and and everybody in our market does, is there's a lot of private equity money out there. Um, and it doesn't have to be, you know, we think sometimes we say private equity, doesn't have to be like New York Blackstone hedge fund type stuff. It's just a lot of people with deep pockets who can take a higher risk level. Yeah, and so I trust me, I compete against it every single day. Um, but uh because I'm in it for the long haul, if it takes me another year to buy my next property or two years to buy my next property, I'm okay with it. I'm okay with it. I've learned um that patience can pay off. Um so you can't sit on the sidelines forever. There's a difference between imagining this perfect scenario that will never occur. So you just sit on the sidelines and just waiting for better market conditions. They don't have to be optimal, just better. And I think that we have better market conditions ahead. So I don't rush.
SPEAKER_00So what does that look like for you? Are you looking and evaluating deals every day?
SPEAKER_01Is that something that No, I evaluate them as the coming I have. I am looking every day if anything pops up. And there are two or three areas that I'm kind of hyper focused on. And so I yes, I'm looking every day, but I'm not knocking on doors and pounding pavement and that. For me, the signals that I pay attention to, unfortunately, are higher unemployment. Usually when the market goes south is where people like myself benefit. Yeah. Right. When everybody's scared and they're running away, the people that have a little bit of experience and have a little bit of capital in the bank say, now I can go out and participate, right? That usually is going to be, again, a little bit higher unemployment. It's going to be higher inventory levels. We have inventory right now that isn't selling, but our inventory levels aren't absurd. You're not driving through a neighborhood and seeing seven for sale signs. You know, in 08, we would drive through and it was like you would count the houses that didn't have a for sale sign, not the houses that did. And I'm not saying we're going there and I don't think we are, but I think we have a little bit more room. Um and then what ends up happening is then you can go out, you have more inventory to put offers against. And because it's a non-emotional purchase, I can go put out five or 10 offers really low, probably insultingly low. And maybe I get one, you know. Um, but there's not enough inventory to really make that hit right now, I don't think.
SPEAKER_00Yeah. And also, like you said, in the Raleigh belt line, I mean, there are these bigger, you know, corporations coming in and buying up the properties. Yeah. How much longer do I guess average Drew investors have to take advantage of it? Or are we already starting to have to move beyond the belt line?
SPEAKER_01Yeah. Oh, I think we're I think we're moving beyond the belt line. Yeah, I think that's I think that's yeah, I think I think that's a a clear now. It's like how far out of the belt line, right? It was, it was, you know, inside the belt line, then it was North Hills, you know, Midtown. Um, and and now we're pushing 540, you know, and and still kind of calling at the city. Um, and so yeah, uh, how do you compete? Um I I think some of it is joint ventures. I think some of it is no longer doing it solo. I think some of it is is creating partnerships um that collaboration, right? Huh? Collaboration. Yeah, it is. That's exactly right, right? Um the prices just dictate that. Um I think also, you know, I if I was to start all over again and I said I was gonna buy a house for 20 years, right? I'd be looking at Sanford, I'd be looking at Mebon, uh, I'd be looking at Wendale, um, I'd be looking at these really kind of non-sexy kind of starters. Um, but there's major highways that run right through it. There's commercial real estate that's being built, the cities are investing in infrastructure. So stormwater, sewer, water, you know, power lines are being run out there. So um if I had 20, 30 years, I think you go buy a house and I'm not giving investment advice, but I think if you were to go buy a 3-2 in Sanford right now, and 20 years from now, you tell somebody you've owned that house and you tell them what they paid, they're gonna be like, wow, you were a genius. And you're gonna say, Yeah, I should have bought 10 of them in 2026. The problem with doing that is right now you're buying a rental house in Sanford, which doesn't sound very exciting and there's no real money in it. Yeah, you're not gonna profit. Not right now, but when you go to leverage that house, when you fast forward 10 years and Sanford's really rolling along, and you do a cash-out refinance and you pull 150,000 out of that house, the doors open up for now, which you can buy. Yeah, you've got the 150 out of there, and maybe 100 you've saved over the next decade, and now you got 250 in capital. The the doors start opening up with what you can do. Um, it's just you got to be okay with that boring first play. And and I think a lot of people just if it's not doing it right now, it's hard to sit there.
SPEAKER_00Yeah. And I guess a lot of people that have investment portfolios, I mean, you could get so uptight about that cash flow and making sure everything's working out rather than waiting for the long term. Do you like let your real estate sales and your other sources of income kind of play into that? Okay, this is why I can I can wait now.
SPEAKER_01A thousand percent. Um one of the things that I've learned, and this is something I've learned in in probably the past five years, is income is massive to being able to do this, right? Are there are strat look if you're making fifty thousand dollars a year, which obviously maybe sounds like a lot, but in Raleigh, unfortunately, just cost of living is you know not that much. It's under the median. Um the strategies you have to implement to grow a real estate portfolio when you're at that income level are super risky. They're just super risky. Um, extremely high leverage, borrowing from here, high end, it's it's super high, it's super high risk. Um, and so yeah, if I'm having a really good year at my real estate sales, there's no doubt that my risk threshold or what I look at goes up, right? If I have a couple sales that I didn't see coming through and they're healthy sales, and it's like, okay, I could put it in the stock market, right? I could put it in my retirement. Um, but maybe I've already kind of put in what I'm comfortable there. So yeah, it it impacts for sure. And the same is if I'm having a down year, you know, this last year was a solid year. This year has been yeah, kind of mediocre. Um, so I'm not in a rush because my risk threshold is a little bit lower this year. Yeah.
SPEAKER_00Yeah, yeah. Um, kind of switching the topic now. Yeah. Um, you obviously do really well in sales, um, same as investing. I know when we first met is because you wanted to uh continue your uh professing career.
SPEAKER_02Yeah.
SPEAKER_00And uh you were interested in in the real estate club at NC State that we had created and you wanted to be a part of that and give back to the younger students. Yeah. Where where does that come from?
SPEAKER_01That's a great question. Um, first, I don't think many people know, but Cam was my my my link in to NC State, and I have to give him a tremendous amount of credit. I had been trying for uh 12 years to get into NC State and and teach real estate, and they didn't have a real estate program or anything at the time. And uh a random interaction at a class I was teaching with Cam was one of those moments in life where it's like, oh wow, you know, it's just it's I I tell a lot of my students that luck is when prop uh preparation meets opportunity, right? And and and so Cam was the opportunity that walked into that seminar and and I was prepared because I had been trying for so long. And so all of a sudden I got lucky and and and got a job, right? Uh doing something I loved. Um I had started, so you know, go back to again, a lot of things come back from that 08, because 08 was really impactful in a lot of people. Um, I was, you know, in my late 20s then, so it was a really impactful time in my life in my career. Um, and so uh go through 08, it's painful for a few years, and I decided, hey, I want to try kind of teaching. I think I would like doing it. Um, but I didn't want to teach like elementary. I wanted to teach something that I really liked. And so anyway, uh approached Wake Tech with a with a class that um I thought would be good, an investing class for continuing education at night. They were like, hey, look, nobody's signing up for real estate classes. Everybody just got punched in the face for three years with real estate, not a popular topic. Anyway, I'm a pretty persistent person. So I spent about six months just grinding on it, called the president of Wake Tech, um, and you know, kind of pitched my case. And after I did that, uh like there was one phone call made, and all of a sudden, all the nose, they were like, Oh, we were we were told we're gonna go ahead and give this a whirl. Um and so I went and taught this class, and and the I remember that I remember it vividly. The first night I taught, I had never taught anything before. So this is all my own content. There's no textbook. I'm like, I'm just gonna get up there and put this together. Spent tremendous amount of time. Anyway, first class was supposed to run from 6 to 10 p.m. Um, I get in there by 6.15. I'm having like an internal mini panic attack. Like, oh, I don't have enough content to cover. How am I gonna do this? Blah, blah, blah. And then I just started talking about what I love, right? And in real estate investing. And then next thing I knew it was 10 p.m. and the class was over. And so I was like, oh wow, that that flew by. That was awesome. And it lit a fire. And so, yeah, ever since then, you know, if I had the opportunity to teach or share or spread the word, I do. Um, and I tried to do it in a way that is as realistic as possible and try to teach it from the perspective of where I was then, even though the market conditions have changed. Yeah.
SPEAKER_00So yeah. What do you hope that the the students, whether it's in the real estate club or from your classes, like what's the main thing you want them to take away from your teachings?
SPEAKER_01Oh, be a better person. Yeah, I don't care if you ever get in real estate. I don't care if you ever make a dime in real estate. I I truly don't care what you do with your life. I mean, I care, but you know, I I but I don't I I want you to leave my class and be like, I can just be a better human. Doesn't have to be crazy, doesn't have to be dramatic, right? Uh you don't have to be Mother Teresa. We, you know, we all have our fun, right? Um, but if you can go out and you can try to give before you get, um, if you can take the shopping cart that's in the parking lot back, if you can pick up the piece of trash, like I I know it sounds weird, but I I firmly believe that if more people did just like a tad more and we didn't just point fingers all the time and we pointed maybe back at us, I feel like we would have a more enjoyable world and and and humanity. Um, so that's the first thing I want you to learn. The second thing I want you to learn is how to understand finances. Again, nothing to do with real estate, but how do you understand finances? How, you know, when you put money in the bank, that's something that you do because we've been trained to do it for generations. You get a paycheck, you put it in the bank, then you pay your bills. Nobody ever asks why. What is the bank getting out of it? Is there an alternative to me giving my money to the bank? You know, and what's the reward to me for putting my money and holding it in the bank? It's right. Or things like the stock market, right? And it's like we've always been trained, hey, put your money in the 401k. I don't have a problem with that. But it's we've been trained like it's like this save all thing. Um, that's always going to work out and there's no risk. And there's just layers to it. And if you don't understand those layers and don't understand where you rank in those layers, you could be set up for disaster, you know. Um, as retail investors, mom and pop investors, we buy stocks, you know, or an app, right? Charles Schwab, Robin Hood, whatever it is. And and I always tell people, look, the the party started at 6 a.m. Our invitation said the party started at nine. We're three hours late to the party, right? Your hedge funds, your AI algorithms, these things are trading before you even log into your app.
SPEAKER_02Yep.
SPEAKER_01So we're always kind of lower on the totem pole, and I don't think enough people understand that. Um, and so it limits the options. So yeah, those are the two things. Be a better person, understand financing. And then if you do real estate, great.
SPEAKER_02Yeah. Yeah.
SPEAKER_00And I know you uh you wrote a book too. Yeah. Um, plug the holes, fill the barrel. Yep. Where did that metaphor come from?
SPEAKER_01Um, so it was something that I had used in my in my teachings. Um, it was kind of a mental image for how to under, you know, how to manage your finances. And, you know, basically if you had a big barrel and that's where all your money went, you know, it's how do we plug those holes? Um, and then how do we put more sources of income into the barrel? Right. Most people live with one source of income. And then when something happens, it's they're tough. It's real tough.
SPEAKER_00Who is the book really written for? Was it for younger people getting started? Was it for I guess people that already had their No, it was actually written.
SPEAKER_01I I think it I mean, truly it was written for anybody who wanted to buy that first or second investment property.
SPEAKER_00Yeah, that's who it really was. Um, I guess what are the com most common holes that investors need to fill to get started? Um, I think it's funny.
SPEAKER_01There's there's two trains of thought to this, right? So some sometimes I live in the world where I'm like, I can't believe I just paid four dollars for a cup of coffee. Yeah, yeah. Okay. And then somebody will say on the flip side of that, and I don't think it's wrong, look, if I can't have a four-dollar cup of coffee, what kind of life am I living? I don't have a problem with that either, right? Um, I think what happens is is sometimes we look at individual purchases in a vacuum. It's only a four-dollar cup of coffee. No problem. But then what did you do during the rest of the day? Well, and then I went out to lunch with some co-workers, and but we we just went to Jersey Mike's. I got, you know, a $10 sub. So it was only a $10 sub. Okay, no problem. In a vacuum, right? And then, okay, what'd you do for dinner? Well, I was tired when I got home from work. So we just did some Uber Eats or DoorDash, but it was only $30 and we split it and we had leftovers, right? And it's like this constant justification of all of these expenses that we treat in a vacuum. And then when you come out of it into the, you know, the 30,000 foot view, you realize, oh wow, today I actually spent $50. I didn't spend four, I spent $50. That adds up. So I think the, I think one place that, and this is more of typically a younger generation type of thing, with everything being in your phone, you can get anything you want at any time. Like you can get Amazon, I mean Amazon all the time, right? So that's one place that I think people should pay attention to is these small, the really, really small things. And then the other thing that I think people really get screwed up on is credit card debt and cars. You know, I I know people that have a thousand dollar car payment. That's a lot. It's it's crazy to me. You have a thousand dollar car payment on a depreciating asset, or you're you're going out and you're doing Uber Eats for $30 or $40 and you have $10,000 on your credit card sitting at 26% interest. It's it's it just blows my mind. It just so those are the areas I think people need to watch the finer expenses. You still live a great life, but it's just you got to sacrifice a little bit here and there. And then I think understanding the finance part of, okay, gosh, I'm getting annihilated on interest over here or my credit card or my car, and they're all depreciating assets. Everything you purchased on that credit card, I promise you, is a depreciating asset. And every vehicle ever driven off of a car lot was a depreciating asset. Yeah.
SPEAKER_00And so those things kind of mess people up.
SPEAKER_02Yeah.
SPEAKER_00And I know we uh, especially in your classes and whatnot, you talk a lot about investing and kind of real estate as a whole. You know, obviously your main source of income is real estate sales, being a real estate agent. Uh, what's your advice to people getting started in real estate looking for that active income, that that first cash flow? Is is real estate sales kind of the the best way to do it, would you say? Uh it's a great question.
SPEAKER_01If I was to start over, I don't know that I would get into brokerage. Um, if I did, I'd probably get into commercial brokerage um and probably a specialty kind of niche type of field. Um that's probably what I do. Or I would get into development and really learn the development stage. There are a lot of layers in development that can be very risky but very lucrative. Um, and so if I was to start over personally, that's what I would do. Um, brokerage, I think there's two things. One, it's just everybody and their mother and their brother and their cousin and their uncle has a real estate license. Yep. It's just the fact of the matter. When the the sheer number I I've had some friends that recently have gotten unfortunately laid off and they call me and they're like, hey, I'm thinking of getting into real estate. I want to have my own schedule and it looks like you do okay for yourself. And it's like you're ready to cold call, right? Yeah, well, not only that, but it's like this idea, I don't have my own schedule. My schedule is whatever my clients are. You want to see a house, you want to sell a house, they don't say, Hey Jason, when are you available? They say, Hey, Jason, I'm available at this time, right? My phone is always on, it's there's always a fire. So it's very hard to get time away. Um, and yes, I can be compensated well for my job, but there's a whole lot of things I don't get compensated for that nobody sees, right? Listings that don't sell, buyers that never buy, deals that fall apart, people that lose jobs, blah, blah, blah. Right. And so um, you have to be really comfortable with the fact that you're gonna work a really long time for crap money in the hopes that you can start to make money maybe before AI impacts our industry. Yeah.
SPEAKER_00What do you think that looks like with with AI? I mean, are you noticing?
SPEAKER_01Yeah, yeah. I mean, we notice it a lot. Um, we we notice it a lot. I think from a broker standpoint, we notice it from a day-to-day just operations. You know, maybe we have less admins or our admins are using AI for some stuff. And and so that part I think is coming hot and heavy. Okay. So I think a lot of that entry level, that admin role stuff is going to be hurt really, really bad. Um, from an industry standpoint, yeah, it's coming. I don't know, I don't know if I'm smart enough to know what it is. When it gets here, I'll be like, oh, that was a genius idea, right? Um, but I will say I see a ton of sellers and buyers who are using AI now before I get to their house. So if I go to a listing appointment now, I will sometimes put the address in AI and say, if imagine I'm the seller of this house, tell me what I should know. Yeah. Because a lot of times they're doing that and getting values and getting information that they think is true or comparables, and the comparables aren't comparables. And so I not only now have to do my job that I would normally do, but I have to come in with knowledge that may go against what the AI said. And if I don't know what the AI said, then I'm at a disadvantage. So it's actually causing a little bit more legwork now. The end game might be that we are an a la carte type of service where it's there's trackable electronic lock boxes on anybody that wants to sell. You're touring the house yourself, and you might call me for a consultation and maybe writing the offer.
SPEAKER_02Really?
SPEAKER_01And and my income is you know decimated um because of that. Um, so yeah. So I don't know. I'm preparing financially. Yeah, financially, and maybe it's conservative, but I'm I'm ready or getting ready for that side of what could come, unfortunately.
SPEAKER_00Do you not think there could be any positive?
SPEAKER_01Oh no, I think there could be a ton of positive, but I think you know, there there's no doubt that AI is that is going to increase productivity. And so you when you're increasing the productivity in a in a brokerage firm, um from a from a broker, yes, that productivity can maybe help me get more sales because I can reach more people, more streamlined. Although you're gonna be everybody around me is gonna be using it as well. So unless you're like the first in line, everybody else is gonna kind of huddle right behind the first leader, if that makes sense. It's like, you know, if you were on YouTube years ago, you're way ahead of the million people that followed your success. So I think it'll definitely be positive. I think it will re dramatically reduce the number of people that are in the industry. That's not necessarily a bad thing. Um, I think there is something though, when I when I come in with 25 years of experience, for example, right now it's hard for AI to duplicate that. It's hard for us to have a conversation when we're standing on a property, you know, especially if we're talking about a high-end property. I don't know if people are quite yet believing what they typed in. Um, so yeah. We'll see. That is a very interesting pay grade.
SPEAKER_00Yeah, yeah. I hope it's all right.
SPEAKER_01Yeah, yeah. Look, every everybody's everybody's gonna be impacted. That that that's I think that's inevitable. Um it's to what degree and are you ready and can you adapt? And some industries will be overcome and new industries will be created.
SPEAKER_00Yeah, I mean, I feel like it's gonna hit every industry the same way. So it will, yeah.
SPEAKER_01Yeah, I mean, you can you can fight it, and that's one path, or you can say, okay, it's coming. So what can I do to get in line and be better prepared? I think that's the better action. I wish us all luck.
SPEAKER_00Yeah, yeah, yeah. I guess I have a couple rapid fire questions. I'd love to kind of shoot your way. Do it. Um, what's the best real estate deal you've ever done and and what made it work?
SPEAKER_01Um, from an investment flip, I did a flip over North Hills in 2021. Um, and it was the biggest project I had done solo. I operated as my own GC. Um, and it came with a healthy payday. Um that so that was probably my my biggest one. Um, and and the reason it worked is I I I was very nervous about doing it. One, it was a it was a large scale project and and I had a career. Um, we had uh we had one child. Uh my wife was pregnant with our second child, a lot of moving parts just in life. And um big check I had to cut to take the project, just a lot of things. And it paid off and it did well. Um, so that was probably the one that I walked away from and was like kind of I don't pat myself on the back too often for them. It's kind of run-of-the-mill business. That was one of those where I was like, hey, that one you did all right there. I was kind of proud.
SPEAKER_00Well, on the contrary, what's the worst real estate deal you've ever done? And and what did that teach you?
SPEAKER_01Yeah, I would say I've been pretty lucky. There's there's two deals that um one I did, one I didn't do. So one uh we were under contract on a historic house way up in Wake Forest, and we were within like a day of closing. And uh I I just couldn't get the gut check on it. I just there was something about it from a scope of work and a risk. I just could not get my gut check. And so last minute we bailed and lost our deposit. It wasn't life-changing money and deposit, but it was money that you didn't want to lose. Um, so that was one that I walked away from that I think would have imploded on us possibly. Um and I uh the one that I regret is um I had a North Hills house that we flipped in uh 2011 and we sold it, and that one still stings. Yeah, that one still stinks that would hurt. That one still stinks. Yeah, I won't tell you what we sold it for or what it's worth now, but that one still stinks. I bet it's a decent margin there, it's it would have paid for probably two college educations. Yeah, it's that's a stinger. Can't beat yourself up over it, right? Yeah, yeah, yeah. I mean, look, hey, uh in 2011, had I known North Hills was gonna be what North Hills was, I would have never sold. Yeah, and you but it probably bought 10 more of them, right? That's exactly right. Yeah, and also one of the things I try to do, I don't always do it well, is I I tell myself that the money that we got from any project that we sold or or that we didn't do helped us do something down the road, and that maybe I wouldn't have done that project down the road or bought that house down the road had I not had the capital from this. Because you it's hard to hold them all. Yeah, it's hard to hold them all.
SPEAKER_00Yeah. Well, what's uh what's one book besides yours that every investor needs to read?
SPEAKER_01Yeah, so it's actually one of one of the books I really like. It's not even a real estate book. It's uh Phil Phil Knight's Nike story. It's called Shoe Dog.
SPEAKER_02Yep.
SPEAKER_01Um and um I like it just because I didn't know the story behind Nike, but it is, I mean, tenacity. I mean, he he he hit some real hurdles and just kept going. Um, and he had people along the way that helped him, and then he had a lot that he had to put on his own shoulder. So I I think that's a great book.
SPEAKER_00There you go. And and what does financial freedom actually look like to you? Is it a lifestyle? Is it you know a certain number? Is it a feeling?
SPEAKER_01Yeah, when you sent me that question, I was I really thought about it. I was um this is a great question. Um I think it's a combination of all. Um, I think it is for me, from a real estate brokerage standpoint, financial freedom means that I don't have to work with everybody that calls me. All right. I've got options. Um from a lifestyle standpoint, um, it is hey, I can take my kids to school like I did this morning. I can be home when my kids are home, you know, that type of thing. Um, so I own my time in that way. And then from a lifestyle, look, I'm I don't know if I'm any different from anybody else. I like some nice things in life. Um, so I like to take a nice trip and do those type of things. So I think for me, it's being able to take that trip and not worrying necessarily what the trip costs or things like that. So I think there's things in each of those elements. Um and it's and then but the the litmus test is how do I sleep at night? Do I sleep at night or am I upstressed? Um, and anytime I'm up stressed at night where I'm not sleeping, there's something there that my my inner self is saying, we're off kilter. Um and maybe it's a quick fix and maybe it's a takes a little takes a while.
SPEAKER_00It takes a little while, it takes a little coming to Jesus sometimes. As I say, yeah. Well, the last question I have for you for someone that's in their 20s that wants to start to set themselves up in real estate, what's the one thing that they should do?
SPEAKER_01Um, I think start saving. Yeah, I think it's boring. Um, but you're gonna need capital to get started without going into just crazy risk. You're gonna need capital. And so start saving. It doesn't have to be a lot. Get just used to the habit of saving. And then as your income goes up, you can you've already got the habit. You can just save bigger and bigger. And then the second thing would be pull the trigger. Pull the trigger. There will never be a perfect time. I I've been doing this, like I said, you know, almost 25 years. Never been a perfect time. When the market's great, you say homes are too expensive. When the market's bad, you say, well, maybe it'll drop another five percent. When rates are high, you know, you'll say rates are gonna come down, just wait a year. When rates are low, you're gonna say, geez, if I buy now, I can't refinance because I'm locked. I mean, you you'll never be happy. Um, so just pull the trigger, get your feet wet, and and I think that's the second piece of advice. Oh, that's that's phenomenal.
SPEAKER_00Yeah. Well, anything else? Uh any last remarks you have for younger people that may be watching this episode?
SPEAKER_01Yeah, no, I mean, I I think um uh like from a personal thing, I would say like ignore social media. Um, I'm a big fan of ignoring social media to the best I can. I think um it's a highlight reel. I totally understand that. I put my, I mean, look, I put my highlights on there, right? Um, you know, people you see what people show you, right? So, you know, I I tell my students, you know, you know, either you create the perception to me, or I create a perception of you based on something you did, right? And so social media is them, you know, people creating their best perception of what they want to be viewed as. And so we interpret it as truth. And so I think it makes a lot of young people feel, even even at my age, sometimes I'm like, wow, that that that guy or gal is crushing it, right? And and I'm seeing that one post, that one segment, and they could be going home to just a rough home life, or they could have debt up to their eyeballs or whatever, right? And so I think turning that off somewhat or just understanding that when you see stuff, it is truly usually the highlight reel. Um, and that honestly has zero to do with you, like nothing to do with you. If that person is uber successful, awesome. It doesn't mean that you need to mimic what they did. It doesn't mean that's gonna work, right? It might not work. They might love that and you might hate it. Don't force yourself to doing that. So so I think turning off social media, and then I think the other thing is find a passion, even if the passion isn't your paying the bills. Teaching and investing is my passion, but I couldn't live on those two items right now. I gotta have my real estate brokerage, which is okay. I don't wake up, jump out of bed, and be like, can't wait to sell another house. I mean, all my clients, I do, but you know, but you know what I mean. And but I I'm okay with that because I have these other passions that the freedom I get from my brokerage business allows me to invest in that. And so don't wait until you're my age or your parents' age to go out and find that passion. Try to find it now, nurture it. And if and if all it is is a hobby for the rest of your life, be grateful you have an unbelievable hobby that puts a smile on your face on a rough day. Um, don't wait to find the passion. Don't wait to take the trip. Life is gonna come at everybody fast. Um, and so you'll regret, I think, not doing those things if you can do it now. Do it while you're young, you're healthy, moving around, feeling good.
SPEAKER_00Yeah, everyone has their own journey and there's no reason to compare it and rush against Yeah, man.
SPEAKER_01And it's hard. I mean, like I said, I do it at my age, you know, I'm almost 50, and I'll I'll still be like, oh, I can't believe I'm only here. Or right. And and and you know, you have to remember that, you know, your worst day would be somebody else's best day. And so we just it's always this ladder, what's next? And it's like sometimes am I I'm terrible at it. And my wife will tell me, you gotta take it, you gotta pump to breaks. Like, you know, it's like I'm always like, what's next? And she's good about being like, what's next? Like you're in it, like enjoy it, soak it up. Like this is, you know, I I I and I'll end on this, but I I I sometimes will tell people, you're usually in the moment that at some point you told yourself would make you happy. Right. And so there was a point in time in my life where I said, wow, if I'm married and got healthy children, that's the pinnacle, right? Or man, if I got a good career and I don't have to stress about paying my bills at night, that's the pinnacle, right? And all of these things, and and I've been fortunate enough to hit those milestones in my life. And every single time I've hit them, the very next question is, what's next? And it's like, dude, you're in it. This is what you said would make you happy, and you are, and you can't prevent yourself from looking next. So, like, give yourself the space and the time to like be like, hey, look, this is good. I'm good, and I can do more, but I can also just be good. And and social media impacts that, right? Is we're always racing. So yeah.
SPEAKER_00Yeah, and then looking back, I mean, on the prime real estate days, uh real estate club days, if you will. Yeah. I mean, that's definitely an instance of that. You know, you're always, I know I personally was looking for the next investment and just trying to excel in my career. And now those days are past, and I'm in the career, and it's like, wow, I I really miss the friendship and actually being together with with all the people that were there.
SPEAKER_01Yeah, it's it's wild how it happens, right? And and there'll be many of those instances in your life as you hit other milestones. Uh, some will be career oriented and some will be, you know, personal or faith or whatever it is. And and you got to pump the brakes every while, every once in a while, and say, holy smokes, like I'm so fortunate. Like, I'm so fortunate right now to be able to not have a boss calling me, being like, Where are you, Jason? Or not be able to take my kids this like these little things that as a as a just a regular old Tuesday I'm taking for granted. Somebody else would be like, Man, I would love to have dropped my kids off at school and not had a boss up my or man, I'd love to have a job. I've been unemployed, you know, all these little nuances that every day we take for granted, and that if one of them was plucked away, you'd be like, Oh wow, I can't believe I took that for granted. So I we owe it to ourselves to just every once in a while be like, relish in it. You're you're here, even if here isn't here forever.
SPEAKER_00We do, and we have a new community coming up June 2nd. So we'll be looking forward to that one. Yeah, it's gonna be exciting. Um, well, Jason, thanks for hopping on today. It really was a great time. This was great. I loved it. Appreciate it. Anytime, yeah, thank you.