REAL ESTATE

Financial Independence in His Mid-30s by Buying Real Estate

8


You don’t have to race to financial independence to get there. Dave Meyer, VP of Market Intelligence at BiggerPockets, took his time building up passive income, and years later, it’s what has allowed him to amass impressive wealth all while living abroad, working where he wants, and securing a very stable retirement. But Dave wasn’t always some housing market genius who knew every statistic and metric about real estate investing. He started as a broke college student with no job prospects, struggling to pay his own rent.

After graduating college during one of the worst recessions America had ever experienced, Dave was waiting tables to keep the lights on. He realized that he needed a different way to get ahead, and just getting a job wasn’t going to be enough. So, even with no money, Dave convinced a few friends to buy a house together while he borrowed money for his share of the down payment. Dave managed the property, took the tenant phone calls, and did what he had to do to learn the real estate ropes. And…it worked!

Now, a decade and a half later, Dave has an entire real estate portfolio of long-term and short-term rentals and passive income streams from syndication investments, but this all started with one small deal he took a chance on. Today, Dave shares every part of his story, from finding the first deal to moving abroad, pausing buying rentals, and why he’s getting BACK in the game now and doing deals again!

Henry:
Hey, Dave, are you in the camp of, you need to get all your ducks in a row first and know your plan exactly before you start investing? Or are you in the camp of go do a deal and then figure out where all those ducks go after?

Dave:
You might be surprised by this because I’m a pretty analytical person, but at least for the first deal, I think it’s more important to just get started and learn on the fly.

Henry:
One that is surprising because you love to analyze things. And two, I completely agree with you. Oftentimes I found that when I have a plan all laid out that it never goes according to that anyway. And so I think we’re going to get into some of the pros and cons of both of those strategies in this episode.

Dave:
That’s funny. It reminds me of this quote by Morgan Hausel. He wrote the Philosophy of Money and he said, the best plan is to plan for your plan to not go according to plan.

Henry:
Yeah, that’s pretty much every plan I’ve ever had.

Dave:
Hey everyone. Welcome to the BiggerPockets Real Estate Podcast. I’m your host Dave Meyer, and with me today is Henry Washington. Yes,

Henry:
It is me. I am here with you and I have a surprise guest. Do you know who it is? I

Dave:
Think I do,

Henry:
Yeah, it’s you.

Dave:
Okay, good. That’s why I showed up to this recording, so I hope we’re on the same page.

Henry:
Perfect. Glad you’re here. Today I am talking with my good friend and co-host Dave Meyer. For anyone who does not know Dave, Dave works at BiggerPockets. He is currently the head of market intelligence, and before that he was the VP of analytics. His background is in data science, so is mine. That is why we’ve become good friends, and he’s also the co-host with me on our sister show on the Market podcast.

Dave:
Well, thank you for having me as a guest, Henry, I am an analytics person, a data minded individual, but in addition to analyzing housing markets and all this stuff, I’ve been a real estate investor for a long time, for 14 years, and so I’m excited to talk a little bit about my investing journey.

Henry:
So today Dave is going to take us back to the key turning points in his investing journey. We’ll specifically talk about two big turning points that Dave took. We’re going to learn how to get started even if you don’t have any capital, which is a problem that many of us faced. Same with me. And we’re also going to learn how to build a portfolio that fits your lifestyle and the goals you have and not just building a bunch of doors. So with that, let’s get into it. Dave Meyer, welcome to the show.

Dave:
Thank you. This seems overly formal to welcome me out to the show, but I appreciate it. I’m excited to talk to you.

Henry:
Yeah, man, this is really cool. I know a lot about you, but kind of get to dig into your origin story and learn more about how Dave Meyer became the data deli. Let’s

Dave:
Get into

Henry:
It. So before you worked at BiggerPockets, what did you do? Did you do real estate investing or was this something you picked up after joining BiggerPockets?

Dave:
I think I am actually one of the unusual people who started investing without ever knowing about BiggerPockets. I started investing in 2010 somewhat on a whim. I knew friends in the Denver area who had started doing it, and it seemed like a great business. So I jumped into it and fumbled my way around it for six full years. And during that time, I was working in tech, I was a data analyst. I was getting a master’s degree in analytics. And I thought to myself, I really like this whole software thing, but I really have a lot of fun doing the real estate investing piece. I found myself on weekends just going to open houses. I just like real estate. And so I started googling around for real estate technology companies and I stumbled across BiggerPockets and the office was a mile away from the house hack I was living in, and there were no jobs for me, but I kept looking at the careers page. I think it was like six or nine months, and eventually I applied for a job and got it at BiggerPockets.

Henry:
So you’re saying there wasn’t some formal plan for you to work your way into BiggerPockets, they just happened to be down the street when you were looking for a job? Yeah.

Dave:
It’s so funny to think about now because BiggerPockets is now such a much bigger company and so many people know about it and we’re very fortunate that we have a lot of very qualified people who want to work here. But back then I hadn’t heard of it and they were only hiring locally and it was just a very different time and I was very lucky to sort of just be in the right place at the right moment.

Henry:
That’s really cool. Now, one thing that kind of struck my attention is you said you fumbled around with investing for six years before you ended up working at BiggerPockets. So give us some definition of what that meant. How many properties had you bought? Did you lose any money? What did that six years look like In real estate investing,

Dave:
The six years were actually quite profitable. It was a good time to get into real estate in 2010. I would categorize it as a lot of equity growth, a lot of bad property management on my part was

Henry:
I

Dave:
Think what really was slowing me down. So I started with a fourplex in Denver and was able to recruit three partners, friends and family for my first deal. I didn’t even have enough money for my down payment, my quarter of the down payment. And so I borrowed that from friends and family too with interest. So I had two loans against it and really just built sweat equity in it, and I got paid as a property manager and did all of the normal property management stuff myself. And that was the first deal. Second deal, I bought a triplex, just a block away, but it took me four years to go from my first deal to my second deal. This remind you, I wasn’t listening to BiggerPockets thinking about scaling. This was just something I did when I had some time and then I started pursuing the rest of my career. So it was four years until I had a financial and personal situation where I could buy again. So I had seven units. And then I think by the time I had joined BiggerPockets, I had also bought my primary residence, so I was up to eight units, three properties in Colorado by the time I joined.

Henry:
Man, that’s really cool. It sounds like you did what a lot of new investors do or sometimes what we encourage new investors to do. You had partners on your first deal, so what did that partnership look like? What made you go down that route?

Dave:
I had no money, so that was why I went down that route. I was waiting tables when I first bought this deal, but I had actually just had some internships in college where I always just liked data and analytics. And so I had done sort of a financial modeling type of internship, and so I was able to run numbers even without a BiggerPockets calculator or anything like that. I had sort of that advantage. And I did that in Denver and it was just so obvious that it was going to make money. This was obviously a very different time. Prices in Denver had gone down dramatically in 2010 and rents had stayed pretty high. It was a popular place to live. And so it was just obvious even though that I had no idea what I was doing, that I was going to make money. And so I was able to go to some friends, some family members in New York where I’m from, and we basically split it up a quarter each for the down payment.
But again, I didn’t have money for that, so I borrowed that again with a 7% interest rate. And it worked out really well because me and one of my friends in Colorado were sort of the active partners and we wound up doing all the property management. I think I took to it more than he did. He sort of became more passive and I was happy to take on the property management, and I used my payment as the property manager to pay off my portion of the down payment loan. So that worked out really well. I wasn’t really making any money off of it at first, but I learned a ton. And that’s really what the first deal’s all about, right?

Henry:
Yeah, man, this is interesting. My story is not too dissimilar where I didn’t have any money. I think I had a thousand dollars saved up in my savings account when I bought my first deal, and I was probably in a worse position than you because I also had not so great credit. And so whenever I tell the story, it’s funny, like I had bad credit and no money, and I’m like, you know what I should do? I should buy real estate. That’s the start

Dave:
A business. Yeah,

Henry:
That’s how I’m going to make money. And so it sounds like you were in a somewhat similar position with a lack of money. Where did the idea come from? Why was it like, okay, well I’m going to buy real estate even though I don’t have the resources to do it?

Dave:
Well, it’s an interesting thing. I graduated college in 2009 and up until 2020, that was I think the worst job market to ever graduate into since the depression. And so I was just trying to hustle honestly. I was just trying to find a way to pay my rent, and I was frustrated because I had this new college degree, but I couldn’t even get interviews anywhere. I wound up waiting tables, which was actually a great job. It gave me a lot of time. I learned a lot of skills that I am very grateful for, but it wasn’t paying me all that much. And at that point, I honestly just didn’t have a lot of career prospects. And so I was thinking, I need to figure out a way to do this myself. And I had done a couple of entrepreneurial type things in college. I started a few very small businesses, I tutored, I did some party planning and organizing, just whatever I could to make money.
So I was just sort of in that mode after college. And a friend of mine told me about real estate. This was a time where you could get that $8,000 tax credit for first time home buyers. So that was a big thing going on back then. And things were just a lot cheaper. The inventory was sitting on the market, you could negotiate with people, and it really made sense to me in a way that a lot of other businesses didn’t. I could just wrap my head around it because as we all know, real estate takes effort, but it’s not that complicated as a business. It’s pretty, the inputs, the outputs, it’s pretty easy to wrap your head around. So I felt pretty good about

Henry:
It. Yeah, man. So let me see if I can summarize this journey so far. So you decided you wanted to get into real estate even though you didn’t have any money. And this was in 2009?

Dave:
This was 2010. It was a year after I graduated college. Yeah,

Henry:
2010. And so you got with a few friends, you bought a quadplex. Yeah. And you were like, okay, this seems to be good. Four years later, bought a duplex,

Dave:
A triplex, yeah.

Henry:
Three a triplex. Okay. Four years later bought a triplex and then so now you’ve got seven units. And then you decide, you know what? Real estate’s kind of cool. I like data and analytics and numbers and technology. I’m going to see if there’s some real estate technology companies. Oh, look, there’s one down the street. And so you look, they don’t have a job for you yet, but you just kind of hang around until they do. And then boom, you start working for BiggerPockets. Is that the origin story so far?

Dave:
That’s right. And I just want to say that for everyone who’s listened to this podcast for a long time, my last interview was me on one side of a table and then on the couch in the office in BiggerPockets was Josh Doan, Brandon Turner, and Scott Trench all interviewing me at one point. And you’d think like, oh, that was so intimidating. But I had never even listened to the podcast podcast.

Henry:
I was like,

Dave:
These are just three random dudes. So this is a totally fine interview. And now in retrospect, it’s very funny to think about.

Henry:
All right, so we know how Dave got started in real estate, but what did he learn from those deals? How has his investing philosophy changed since then and when did he stop managing his properties himself? We’ll get into that right after the break. Welcome back investors. I’m here with Dave Meyer and we’re talking about how he got started in real estate. Okay, so you’ve got seven units, you joined BiggerPockets, you start working with them. I’m sure you were learning a ton. So how did the culmination of those first couple of deals you did plus working at BiggerPockets, how did that impact your investing journey? Did you shift to a different strategy? Did you stay the course in the same strategy? How did that impact you moving forward from there?

Dave:
I think almost immediately I became a much better and more sophisticated investor. For example, I had this first deal and I was so proud of how much equity it had built up, and it was sort of like in my mind, this savings account that I had created. And I was so excited about it. And I started reading the forms on BiggerPockets and I was like, man, I should have cashed out of that a long time ago and bought all these other properties. And I was sort of, my return on equity was not good. And I started learning from people like Jay Scott and Brian Burke who have been around for a really long time, the BiggerPockets community, not to mention Scott and Brandon and people I worked with directly. And I started just being much more efficient with my time and capital. So I outsourced, I started building systems and outsourcing a lot of things.
I was able to take on more sophisticated projects like doing burrs. I think I did a couple of those. And then I think the other piece that gets overlooked in many people’s stories is I had a really good stable income. And it wasn’t just the fact that I was learning from BiggerPockets, but I also was able to get loans and was able to build my portfolio in a relatively traditional way. And so that really helped accelerate my investing career too. And so from 2016 until I moved to Europe in 2020, I just really optimized my portfolio, pulled equity out of those few deals and was able to redeploy it into a couple more deals. Not a ton, I don’t have this massive portfolio, but I bought a bunch more deals in Denver and was able to set myself up really well before moving overseas. And then that was sort of this whole other part of my investing journey.

Henry:
So I do want to get into that shift, but before we get there, I think what’s interesting is your journey does mirror a lot of other real estate investors in that you just jumped in and got started. And then as you got started and you got around other seasoned investors, you started to learn more and get more sophisticated and then bring in processes, procedures and optimization into your business. Now there are typically two schools of thought when you are going to get started investing. And there’s people in the camp that you were in where it’s just like, alright, I’m just going to go do a deal and then I’m going to figure out how to what I like or what I don’t like and how to shift my strategy. And then there’s others who are like, alright, I want to make sure that I know everything that I’m going to do, what kind of asset I’m going to invest in, that I’m financially set up for it, that I am optimized on the front side so that when I get going, everything is in place. And what I find sometimes is a lot of the people who want to do the latter strategy don’t ever get started or it takes them a long time to get started. And so looking back on your journey, would you do it the same way again or would you line all your ducks up in a row first and then get started?

Dave:
I’m very grateful I started the way I did. It’s sort of this crash course in investing when you just jump into it. I wish maybe I picked up a book and read one or two before, particularly about property management. I was just god awful at that for a long time. But I just think it’s really important to learn the basic frameworks, the basic structures, and then you just have to do the thing. And it’s funny because in my job and on the podcast we host on the market. I’m an analytical person, but when I get into underwriting and deals, I think I’m pretty good at it. But I don’t super stress about every single thing. I just trust that real estate is a good business, that I understand the fundamentals I build in solid cushions and I also just accept that things are going to go wrong.
That’s just part of the business. But if you keep your eyes on the longterm, which I think is the one thing I’ve always been able to do is just like I want this for 20 years from now. I want this for 30 years from now, and it makes decision making so much easier. And so even back then I knew I was going to take some lumps when I first started the business, but God, everyone sits around. They’re like, oh, what happens if my first deal doesn’t go well? Yeah, it’s hard for the first year now, whatever it is, 15 years later I’m like, oh, I’m so glad I went through all those loans. Every single phone call, every single hard conversation I had with a tenant or a contractor was a hundred percent worth it. And it’s just all about keeping your eyes on the long-term goal.

Henry:
I couldn’t agree more. I don’t know. For some reason people forget that they forget the third word in real estate investing. It’s real estate investing. And when you think about investing in any other asset class, people expect, I’m not going to bat a thousand. No one that’s in the stock market thinks every trade I make is going to win. They understand that I am going to make trades that lose, but my goal is to win more than I lose. The principles are very similar, but with real estate investing, I think sometimes that gets lost. So I appreciate you sharing that sentiment. Yeah,

Dave:
I think that is definitely true, and it’s because probably real estate is a capital intensive investment. You have to put up a lot of money. But the other part that gets lost often is that real estate is actually a very forgiving asset class. You see stocks go to zero, you see stocks go down 30%, 50%, yes, during the great recession, there were some areas that saw declines that big, but that is one period in US history that’s happened. And if you held on long enough, as Henry said, things just went back to normal. And I probably approached real estate a little bit differently from a lot of people who are getting started who focus a lot on the deal. But I do think one of the reasons I was able to jump in is because I kind of just focused on the asset class and used the skills I did have, which were analytical to just look at how real estate is performed. And even though it was the depths of the real estate crash, it just, of course it was going to come back. And now everyone’s like, oh, you bought in 2010. So yeah, of course you did well, but every person was telling me not to. So I think that just has helped me a lot.

Henry:
So at this point in your journey, I heard you say you then moved overseas. That’s a big transition and that has to have an impact on your investing. You can no longer just mosey on over to your properties, you live across oceans. And so how did that transition impact your current investments and impact how you chose to invest in the future? I

Dave:
Think it’s probably the most positively beneficial thing to have happened to my real estate investing career for two reasons. First and foremost, I needed to learn how to hire people and outsource things, which is not something I fully understood. I was still managing all of my properties. I did have a property manager for short-term rental, but I was doing things myself. And so learning how to hire people and work with contractors, property managers in a better way was super helpful. And the second thing is it sort of just breaks you out of a rut. Not that I was out there doing tons of deals, like I’m not a full-time or professional investor. I work. So I was building my portfolio at a good clip, but you fall into doing the same deals and the same neighborhoods, the same kind of things. And it sort of was a shock to the system and forced me to learn how to invest passively. And so that in one respect was hiring property managers for my existing portfolio,

Henry:
Hiring better property managers than the ones you hired first.

Dave:
Oh, for the short-term rental. That one took a little while, but I wanted to learn passive investing and how to invest in syndications and multifamilies and funds. And so I learned how to do that and actually did that exclusively for three or four years before recently jumping back into buying directly.

Henry:
Okay. We have to take one more short break, but stick with us. Dave and I will talk about portfolio balance and how to design your real estate strategy around what you’re actually good at right after this. Welcome back everyone. Let’s jump back in. So you are one of the unique investors who’s done both. You’ve got your own properties, plus you’ve invested in syndications. Can you give us a quick comparison to how each of those assets work in your portfolio and which one has the better returns for you?

Dave:
Yes, I am glad you asked this question. This is one of my favorite things to talk about because as I’ve learned more about the broad array of different ways that you can invest, I really have fun thinking about how to build out a well-rounded portfolio. And to me, that includes both passive deals and active deals. Because while some offer better returns on paper, I think both have really important values for the sort of portfolio that I’m trying to build. And so for me, I as an active investor have limitations. I live overseas, I don’t do what you do well, Henry, which is going out and finding off market deals. That’s not a skill that I have. I don’t manage big renovations. I did some medium-sized renovations in Denver when I was living there, but I can’t do that. But those are great ways to make money, to find off market deals, to do value add is an important part of a strategy.
So for me, that’s what I use passive investing for. So I invest in syndications where they’re buying properties, multifamily properties that they found off market or found in a creative way and that they are adding value to. And I can benefit from hopefully those big swings, those big potentials to build equity in those type of deals. And it’s great. And on paper, they’re amazing, on a lot of them. You see IRRs, the internal rate of return of 15%, 18%, 20%, it’s a fantastic return, but there are trade-offs with them. First and foremost, you have to put a lot of money into syndications. I don’t think everyone knows this, but oftentimes the minimum investment is six figures. So there’s limits that’s obviously very restrictive. The second thing is that you have no liquidity because if you’re an investor, if you’re an LP in a syndication, you give the operator your money and it’s up to them when they sell and when you get your money back.
So it limits your flexibility in how you deploy your capital and you’re not really managing the asset. You don’t get to decide when to do the value add or when to make the upgrade or when to do the cost segregation study. There’s just limits to how involved you are. And so for me, I have resumed buying active rental properties again for two reasons. First and foremost, even though an rental property is not liquid, it takes time to sell. I at least get to decide when to buy and sell them. And I think that’s really important to me. Two, there’s great tax benefits to owning rental properties. And three, and this is sort of part of my entire philosophy of real estate is I don’t plan to become a full-time real estate investor. At least anytime soon I’m going to keep working. And so my time horizons 10, 15, 20 years from now, and so I’m just buying rental properties that in 10 or 15 years I know are just going to pay for my lifestyle and syndications, they usually last 3, 5, 7 years. And so even if I invest in great ones right now, I’m going to have to figure out how to redeploy that capital in a couple of years. Whereas with long-term rental properties, I could just put my money into them. And then that’s my retirement plan. The ones I’m buying right now, that is my retirement plan. And I’m excited that I have the opportunity to buy them now and not think about what their performance is this year or next year. But I know 10, 15 years from now they’re going to perform for me.

Henry:
Man, this is great. I don’t know that people who are listening to this realize how much of a lesson in real estate investing that they are getting right now, but this is phenomenal. I actually heard David Green recently give a talk around a similar concept of what’s called portfolio architecture, what he calls portfolio architecture. But essentially what you’re saying is I know what I want in terms of what my investments to look like and the returns that I want. I know what my time horizon is in terms when I want real estate to take over the financial burden of my life. I know what I want my current lifestyle to look like and how much time and energy I have to put into real estate investing. And so you take all those points of data in your life and then you build a real estate investment plan that fits your goals.
This is what we should be doing as investors. I think a lot of the times, and I am guilty of this as well, we just go buy stuff, right? We’re like, ah, good deal, buy it. But we don’t think about how that impacts my current lifestyle and the way I want to live my life and what my plan is 10, 15, 20 years from now. And so I’m not saying don’t go buy good deals, guys. I’m saying as you start to do deals, think about what your 10 years, 15 years, 20 years looks like, and you want to be shifting or optimizing your investment strategy to fit that in the long term. So you don’t have to get started with that in mind in the very beginning. And you don’t have to not do deals that don’t fit that, but you want to keep that in mind because it’s truly, we’re doing this because we want to live a certain life and only we know what that life is. And so you want to build your business around providing you that output. And I think that you are a good example of someone who is doing that well. It helps with the squirrel syndrome. People ask me, well, why don’t you do multifamily? Or why don’t you do this? Or Why don’t you do that? And I’m like, I’m pretty clear on why I do what I do and it kind of keeps me focused and I don’t have to go after the shiny object. And it sounds like that’s very similar for you.

Dave:
Yeah, absolutely. I’m sort of boring about it, and I am totally okay with that. And I think it’s very difficult, especially if you listen to this podcast in reality, you hear some incredibly successful people. I host this podcast, I host a different podcast on the market with you and with James and with Kathy, and I hear about all the cool stuff you’re doing, and there’s always this moment when I’m like, man, I wish I could do that. You get FOMO in reality and you think, oh, they’re doing such amazing things. I wish I could do that. But at the end of the day, you have to sort of take a step back and figure out, like you said, why you’re doing it and what you’re good at. I wouldn’t be good at the things that you’re good at Henry, and it is sometimes a hard pill to swallow, but I think in the long run, it just leads to a better life and a more balanced life, just sticking to what you feel comfortable with. Not to say you shouldn’t take risk and push the envelope, but just accepting that there are only so many different strategies I can learn. There are only so many different skills that I can acquire as an investor, and I have other interests outside of real estate. And so I’m not going to devote every minute of my life to becoming the best possible investor. Again, I work a full-time job. This is still a side hustle for

Henry:
Me. I love that. I love that because too many times people get caught up in the, I need to go buy a bunch of doors. I remember the last time we met up all in Denver, I asked Scott Trench, what’s your plans for your real estate portfolio next year? And he said, I’ll probably buy one, right? Yeah. That’s his goal. It fits his goals and his lifestyle. It fits his investment strategy. And so don’t get caught up guys in thinking you need to build this massive portfolio. You need to build what fits your goals.

Dave:
Absolutely. I think I might’ve told you this story once, but I was at BP Con and I was talking to one of the attendees and he was like, yeah, I’m just a newbie. I was like, that’s cool. It’s great. Everyone coming here was like, yeah, I only have 37 doors. And I was like, that’s more doors than I own. I mean, I don’t know how many I own because I invest a lot of syndication, so I don’t like the door count thing, but direct ownership, you own more than me. You’re not a newbie. This people are competitive and that’s natural, but I think you’re better off sticking to your own goals and just pursuing them. And it’s hard. But I do think if you can learn that skill, you’re going to be a more successful investor.

Henry:
So again, I commend you. I think it’s great to have a strategy. There’s a lot of people who aren’t investing just so they can quit their job. You have built an investment strategy that allows you to have the flexibility to live overseas and continue to work your day job because you love it and enjoy it so much. And I think that that’s super special. So can you just give us the summary what your investment portfolio look like now and what are you most focused on in your real estate investment business going forward?

Dave:
Yeah, so my portfolio now is, I guess I sold off one from Denver. So it’s basically what I left the United States with a couple of years ago. I have not bought anything new in Colorado, but I’ve invested in several syndications all over the country. Really, I think in five or six different markets. They are all multifamily. I have not done any self storage or anything like that. Like I said, I’m boring. I just feel like I understand the idea of supply and demand with rent, so I just stick with that. But I am in one lending fund to private lending, and that’s something I am trying to learn. So that’s sort of my growth strategy is I want to learn how to do private lending. And then this year, we’ve talked about this on the market show. My goal as an investor was to start buying property again directly due to some of the reasons we were just talking about and bought a duplex now in the Midwest in a new market, much cheaper market where you can at least get break even cashflow.
But it’s a good growing market and I’m closing on another one tomorrow. So I am hitting that goal. And if I had to describe my philosophy with real estate investing in general, it’s right now I’m trying to do two things, buy a couple of duplexes, long-term holds, and then get it so that I invest in maybe one syndication a year or two for seven years or so. And that way I have them exiting hopefully regularly every once a year so that I am getting some liquidity and some predictable liquidity on those things. So I’m trying to do the dollar cost averaging approach to syndications while I buy some duplexes and small multifamily in the Midwest.

Henry:
So for those that are listening to this, what Dave is talking about with the syndications is typically when you invest in a syndication, you put a big chunk of cash up and then you are hoping for X amount of return on your investment. But typically the syndications have a hold time at least of five years or so. Some are five, some are seven, some are 10. But what Dave is saying is if he invests into a new syndication every year, once that five to seven year period starts to roll around, then every year he’ll have at least one or two syndications that are exiting and paying him out. So that creates income year over year, is that correct?

Dave:
Yeah, exactly. I’ve been doing this for I think four years now. I started doing the pandemic. This is my fourth year I’ve invested in syndications. I going to keep doing it. I know the market’s not what everyone wants it to be, but the idea behind, if you’ve never heard this term of dollar cost averaging, it’s basically you keep putting regular increments of money into an asset class knowing that you can’t time the market because it’s very difficult. But if you sort of just keep doing in a disciplined way that you’re going to tie your investment to the median or the average return for that asset class and for real estate, that’s very good. I would be very happy over the lifetime of my investing career to tie my performance to the average performance of real estate. And so that’s sort of what I’m trying to do with these syndications.

Henry:
Man, that’s super smart. That sounds like a great plan, and I’ll borrow your money. So cool. You want to lend, you got your boy right

Dave:
Here. Every time I say this, I got to actually start doing this. I’ve been saying it for six months, like, oh, I’m going to learn to be a private lender. I always get these messages. Do you want to lend to me? And I have to reveal that. I don’t actually know yet. I’m still learning. I’ve read a few books. I’m getting there, but I haven’t pulled the trigger on actually directly lending to anyone yet. Well,

Henry:
Thank you so much, Dave. This has been super insightful to get to know a little more about your personal story and journey, but it’s really cool how it’s all tied together to fit your life and your lifestyle, and I think it’s going to be super beneficial for people. This is a phenomenal story and we appreciate you being so candid with us.

Dave:
Thank you. Yeah, and I’ll just say the one thing I feel I’ve learned from working at BiggerPockets for a long time is that real estate, the benefit is that it fits really anyone’s lifestyle For me. I work full time, I live overseas. That’s a pretty different goal than what you have, I think Henry or what a lot of our mutual friends in real estate investing do. And that’s what’s so cool about it that if you figure out what you want, you can craft a portfolio and a strategy that works for you. And hopefully Henry and I sharing some of our experiences or thinking about it will help inspire you not to do what we’re doing, but to come up with your own approach for yourself to hit your own goals.

Henry:
Absolutely. Perfect. Thank you so much, Dave, and thank you so much everybody, for listening. We’ll see you next time on the BiggerPockets Podcast.

 

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