How a Mailman Was Able to Quit His Job Through Real Estate Investing with George Gipson

Brandon:
This is the BiggerPockets Podcast show 404.

George:
If you just tell everybody what you do. I told all my coworkers, the babysitter, uncles, aunties. If you tell people what you do, it’s always somebody in a situation where they need to get rid of a house.

Speaker 4:
You’re listening to BiggerPockets Radio. Simplifying real estate for investors large and small. If you’re here looking to learn about real estate investing without all the hype, you’re in the right place. Stay tuned and be sure to join the millions of others who have benefited from biggerpockets.com. Your home for real estate investing online.

Brandon:
What’s going on, everyone? It’s Brandon Turner, host of the BiggerPockets Podcast, here with my co-host, Mr. David Greene. Welcome to show 399, David. How are you doing?

David:
I couldn’t be doing better. I’m on the BiggerPockets Podcast. Actually, I probably could be doing better. I’m very sore. I kicked my own butt this weekend running and hiking in the woods. And so, I feel really good, but I’m definitely tired.

Brandon:
Getting the goods in the woods, as our friend Tim would say.

David:
Yes, he would, and it rhymes, so everyone here that just heard this will remember it.

Brandon:
They will remember it, yep. Anyway, what’s up, man? I know you’ve been working out a lot. You’ve been getting all in shape and stuff and looking good.

David:
Well, I can’t work out. All the gyms are closed in California. It’s driving me crazy-

Brandon:
Oh, you’ve been running. Running’s working out. That’s the same thing. Whatever.

David:
Well, I guess. I think of working out like lifting weights, and I think of running like hell.

Brandon:
My buddy Mike says like… He calls it farm fit or something like that. He’s like you’ve got to get in shape with what you have around your house. So, benching cows and-

David:
They use bales of hay and they just throw it around-

Brandon:
Exactly, yeah. You’ve got to get-

David:
… or bags of feed.

Brandon:
Yeah, exactly.

David:
Like Rocky in Rocky IV where he’s out in the woods picking up trees and stuff like that.

Brandon:
You do what you’ve got to do.

David:
You do what you’ve got to do.

Brandon:
You go get your camera, set it up on a little timer then go grab a tree, hold it up, and I want to see that in your Instagram later. What’s your Instagram? davidgreene24? Everyone go to davidgreene24 on Instagram and go look for David’s picture of him holding the tree.

David:
Can’t you just invite me with Hawaii and I can do this with fun stuff. I’ll pick up a few shells-

Brandon:
I want you to pick some water and hold it above your head.

David:
We’ll go swimming or snorkeling or something.

Brandon:
There you go. You can do the hair flip thing that girls do with the cool Instagram. The hair flipping in the sunset.

David:
I’ve been practicing that, just wait. One of these days I’m going to unleash it on the world. They’re not ready for it.

Brandon:
It’s like Blue Steel or like Magnum, right? All right, we got to… Yeah, there we go.

David:
I call mine green magnesium.

Brandon:
All right, we’ve got to get on today’s show, but before we do, let’s get to today’s quick tip. Today’s quick tip is very simple. Earlier we recorded, but it’s coming up here. We just got finished recording with today’s guest, George, who’s awesome. You’re going to love him. George tells a story later on in the show about how he bought a duplex, and the rents that he found out that it was actually being charged were not what the rents were advertised as being charged.
So, I just wanted to throw it out there because I do mention it in the show. There’s something called an Estoppel agreement or an Estoppel certificate that you have tenants sign when you buy a property that has already been… It’s currently rented. Just throwing that out there, if you’re going to buy a property, make sure you search BiggerPockets or even Google, if you don’t like BiggerPockets, and search for Estoppel, E-S-T-O-P-P-E-L, I think.

David:
Wow, good job.

Brandon:
Thanks. I just wrote that chapter in my book. The multifamily book that I’m writing. So, it’s in my head, fresh. I’ve probably got it wrong and now I look like a complete moron. Anyway, don’t always trust what agents say is the rent. A lot of times they’re writing what the rent could be, not what the rent is. So, make sure you verify that before you buy a property. And that is today’s quick tip.

David:
Quick tip. Trust, but verify. That’s great.

Brandon:
With that, we’ve got to get to today’s show. So, today’s guest is George Gipson. George Gipson is an awesome dude who was a mail carrier, and he’s going to tell a story today about how he went from that to full-time real estate investor, through the power of just cashflow and doing a little bit flipping in there. He’s done a lot of cool stuff today.
A lot of it is really good advice. Everything from like we mentioned the quick tip, the Estoppel stuff. We talk about what it takes to actually quit your job. We talk a lot about house hacking today. We talk a little bit about buying at auctions and so much more. George is just a bundle of energy, and I think you’re going to like the show.
By the way, just a quick word of, I don’t know, warning. It’s not like a warning, but right in the middle of the show or towards the end of the show, George’s microphone gave out, so we switched to his other microphone. So, if you all of a sudden hear a change in microphone sound, don’t get panicked. It’s not your audio in your car. It is just the change of microphone, and be aware. With that said, anything you want to add? Or should we-

David:
All righty. Nope, let’s bring him in.

Brandon:
All right, let’s get to today’s show with George Gipson. All right, George, welcome to the BiggerPockets Podcast, man. Good to have you here. How are you doing?

George:
Oh, thanks for having me, man.

Brandon:
Yeah. So, I want to hear a little bit about your story, get into real estate obviously. But I know you were a mail carrier. Is that correct?

George:
Yes.

Brandon:
Tell us about that.

George:
All right. So, basically, I was a mail carrier. I graduated college and I didn’t use my degree right off the rip. I became a mail man at the post office. So, I worked for the post office for maybe six years, and the first year at the post office I was listening to music. Music, music, music, right? So, I’m driving the mail truck, I’m listening to music. I ran out of all the songs to listen to, and I come across podcast apps, right? So, when I come across the podcast app, I type in success, motivation, real estate, and over time I discovered the podcast. It was around episode in the 50s. So, yes, that was the beginning, right?

Brandon:
Yeah, that was a while ago.

George:
I literally remember where I was at when I listened to the first episode. I was just thinking about it today, what street I was on. So, I listened to the episode, and I was delivering mail. I listened to the first episode and I pulled over. It basically like, “This is me right here. I comprehended everything this guy just said.” So, I’m on the side of the road. Whenever you see a mailman on the side of the road and he’s just looking at his phone, probably looking for the next podcast.
So, I went back to episode one and I started from there in my journey. I listened to the podcast every Thursday, and for five years I was at the post office. And when I first discovered it, I didn’t have any rental properties, and I just listened and kept learning. And then my goal became to… I want to leave my job by buying rental properties.
So, like today, last year back in May, I quit my job. I didn’t have any properties when I quit, but I quit my job and a guy told me, “George, when you put two feet into the real estate game, you’re going to take off.” And that’s basically what happened. I got into real estate and now I got 12 properties, mostly single family and one duplex.

Brandon:
That’s awesome, dude. All right, so I love that you just said, somebody said, “Once you jump in full-time, you’re really going to take off.” Because I think that’s the way for a lot of people. People are toying around with it and they like the idea of it, and they’ve got the intelligence to be able to do it. They’ve got the education and they obviously know what they’re doing enough, but their job holds them back. So, it’s cool that you were actually able… So, you quit your job at some point to jump in full-time.

George:
Yes. It was scary, and I listened to all the podcasts and they say, “You want to have maybe making exactly what you were making at your job in rental income.” But for people listening, what I’m about to say today, you have to believe what I’m saying, because everything Brandon and David say, it works. My people at the job, they were like, “Man, you can’t buy that house.” Or even my family members, “Oh, that’s not a good deal.” But the people you’re asking, maybe don’t even have any rental properties, so they don’t see the vision. So, my friends was like the podcast guests.

Brandon:
That’s awesome. All right, let’s go back to the beginning then. How did you get your very first property?

George:
All right. When I discovered the podcast, I was living at my parents’ house. Me and my wife… Or my girl. She was my girlfriend at the time, but I was living at my parents’ house and I had started listening to BiggerPockets. So, even though it was a personal home, I knew at the end of the day it would be an investment. So, I wasn’t thinking like, “I’m going to live here forever.”
So, I started doing my research based off the information I knew, and I found a house, basically, three-bedroom, two-bath, and the crazy part about it is when I googled my address, it was a flip. The person who was doing the flip is a member of BiggerPockets. So, they put the whole deal inside of BiggerPockets. So, I seen where he purchased before, how much he put into it, and I’m like, “I’m buying this deal.” And he asking questions on the forum.

Brandon:
That’s funny.

George:
So, that was my first property. I purchased a three-bedroom, two-bath for $130,000. Actually, in that deal, the house was in the flood zone. This is my first time purchasing a home, and I had no idea about the flood zone. So, once I found out the home was in the flood zone, I immediately went to Google and started looking up, “Should I buy a house in the flood zone?” Every post said, “Do not buy a house in the flood zone. Do not.”
So, I’m like, I made a mistake. In that situation, I tried to back out of the deal honestly, but it was investors with the guy and they were threatening to sue me for $10,000. And I’m like, “I don’t even have $10,000. How’re you going to sue me.” But that was my first deal. I ended up buying the house and I stayed there for a while, then I sold it. When I sold it, I made $28,000 profit and I was like… That was the most money I ever had at one point in time at that time.

Brandon:
That’s awesome.

David:
Okay. You’ve said two things I want to comment on. The first was this one right here. Everyone said, “Don’t buy a house in a flood zone,” followed by, “I sold it, I made $28,000, and I went on to my next thing.” Your first deal, you didn’t know exactly what you were doing. You found it on the BiggerPockets forums, I guess, or maybe the marketplace. Is that what it was?

George:
No, the house was listed on MLS, but the person who did the flip, they were asking questions on the forum. So, the address was in there.

David:
Gotcha, okay. And the second thing you said was everybody says don’t leave your job until you’ve got the same income from real estate investing. And what I’m getting at here is I don’t like the hard and fast rules.

Brandon:
Everyone says.

David:
Yes. This is the way you’re supposed to do it. It doesn’t work that way. We see this with a bird deal. You’re supposed to get 100% of your money out, so if you leave 11% of your capital in that deal, you did a bad deal. Well, that’s not true because if you compare that to the 20 or 25% you would have left in it plus the rehab cost, that’s a way better deal. It’s like a third of the money.
And I hear it with house hacking. Well, the house should pay for 100% of your income. Well, that’s not always realistic. Some of these houses we’re helping people with in the Bay Area, their mortgage would be seven grand, instead it’s two grand. That’s a five-grand net to them that’s so much better than if 100% of their money came back that was $2,200 a month. It’s more than double what the other person would be.

Brandon:
Or like everyone has to get the 1% rule or the 2% rule. It’s the only way… You have to get this.

David:
Yes, it doesn’t meet the 1% rule, I can’t buy it. My cash-on-cash return is not 15, it’s 14.7% and I can’t go for it. And then you look at five years down the road, and the rents have increased so much that it’s blown away that 15%. But the person who bought the one that did meet their… I’m just using 15% as the hypothetical number, the rents haven’t gone up at all.
You can’t create this hard and fast way of looking at this. I much rather prefer to look at it like, “Would I be better off if I bought it than if I didn’t.” It’s just a much better metric to look at than, “Does it meet 100% of my needs?” And as we go through your story, what I wanted to point out was that none of everything you tell us would have happened if you had listened to the people who said, “Don’t buy a house in a flood zone. Don’t do it unless you can get this. This is the only way to do real estate investing.”
And I’d also like to point out that in five years from now, whatever success you have now will probably be dwarfed by what you get if you continue to put 100% into real estate investing, so everybody keep that in mind too. Okay, thank you, George. I’m going to let you continue.

Brandon:
George, can you explain for those who don’t know, what does it mean a flood zone? What does that mean? I want to talk about that for a minute too.

George:
I’m in Florida, so a lot of properties, the older properties are not built up on elevation. So, with that being said, the government thinks that your house is more likely to flood if you have high water. So, in this case, this house, it wasn’t on a high… It wasn’t the worst flood zone, but it was in the flood zone. So, in that case, whenever you’re in the flood zone and you’re getting a mortgage, FHA conventional, you must have flood insurance. And that was the big kicker to me because you want your payment to be low, but this flood insurance is going to make your payment go higher.

Brandon:
Yeah, so flood insurance. I actually built almost all my first properties, all of them in the beginning were in flood zone areas. Because flood zone areas were just cheaper. It was cheaper to buy in a flood zone than it was not a flood zone in my town of Grays Harbor, Washington. Yeah, and people said I shouldn’t do it.

David:
It’s funny, Brandon and I have driven through this town. All those houses look like they’re built on stilts.

Brandon:
Yeah, they do.

David:
The whole town, that’s how they build them.

Brandon:
They build them up… Yeah, it’s a different type of building, but you know what? Flood insurance, yes, it costs money, and there was some risk added there. This is a very short explanation, but right now flood insurance would be very expensive. However, the government actually subsidizes flood insurance right now. So, there’s a government program that subsidizes. They have for decades. They’ve subsidized it because they want people to have flood insurance and not destroy their livelihood because of a flood.
Normal insurance does not cover floods, and so, you have to get flood insurance if you’re in an area the government says, “Hey, this is a floody area.” They should just call them floody areas and not flood zones. I think floody area is a better word. So, in a floody area-

David:
Says Beardy Brandon.

Brandon:
Yeah, so in floody area, you basically said, “Hey, you have an increased chance, so you have to have this flood insurance, and we’re going to help subsidize it.” Costs are different depending on what state you are and all this stuff, but it’s not a crazy amount. Do you remember how much your flood insurance was per month?

George:
Yes, and that’s the crazy part. The flood insurance was only like $300 a year.

Brandon:
Yeah, yeah, yeah. It’s not crazy.

George:
So, I bought another property that’s in flood insurance. When you google it or ask other people, it’s just they say, “Don’t buy a house in flood zones.”

David:
It’s easy-

Brandon:
Yeah, I just say do the math. Work backwards. Run your numbers as needing flood insurance. So, we have the BiggerPockets Rental Calculator and the Bird Calculator, when you’re running that number in there, or if you just do it on your method, put a spot in there that just says flood insurance. Like insurance other, flood insurance. I always add that in if I’m going to look in a flood zone.
And yeah, it’s definitely not something to be like… It’s kind of like people who say, “You shouldn’t buy a house with a bad foundation,” or, “You shouldn’t buy a house with a bad whatever.” Just figure it out. In fact, by doing so, you can get good at something that most people are afraid of.

George:
Yes, as a realtor, every deal… I help customers and maybe they find out that the water pump is bad or the septic tank is good, and the first thing they do is scratch off the whole deal saying they don’t want to buy the house. And me as an investor, I tell them, “All right, let’s find out how much it costs to fix it.” Now, how much it costs to fix it, I usually just subtract that from the purchase price and make my offer, then we go from there.

Brandon:
Yeah. Every problem’s got a number.

David:
I think the first show I ever hosted with you Brandon, that’s what I said is you’d asked me about lead-based paint or termites. All these things that people say, “Never do it.” No, just take the problem, turn it into a number and make the numbers work. Numbers are the common denominator. So, if someone says, “Oh, the foundation’s going to cost $50,000.” Well, if you get a $150,000 discount and then maybe you know someone that does foundations that can do it for $30,000 that’s actually a good thing to look for.
You should be grateful that there is a foundation problem, and I love that advice you’re giving George. So, don’t just automatically just disqualify a deal. Look at it and say, “Can I handle this? And how do I make the numbers work?”

George:
Correct.

Brandon:
Cool, man. All right. Well, let’s go into the rest of your story. So, you bought this first house, it was a flip, right?

George:
Well, I lived in it for almost two years, and my realtor-

Brandon:
Lived in it, okay.

George:
I was watching houses go up for sale, and I was like, “I wonder, could I sell it?” And she was like, “Yeah, it don’t cost you to list it.” And at the time I didn’t know, so I was like, “Let’s list it for sale.” I sold… It took about three or four months, and when I listed the property for sale, somebody turned the garage into a third bedroom. So, in the image for the realtor picture, when the garage is down, they think they’ve got a garage. When you lift it up, it’s only half a garage.
So, I had 30 people come look at it, and when they lift that garage up it completely turned the deal off. So, I told the realtor, maybe I should add a driveway on the side. She was like, “Do not spend any money on this house. Do not spend any money, you’re selling it.” But I went and did it anyway. I painted the house, put the driveway, and the next person who came, they put in a offer. So, I went with my gut as an investor. Realtor and investor, I think sometimes have two different mindsets.

Brandon:
Yeah, it’s smart. Sometimes you’ve just got to go with your gut, figure out what you think is going to be best there. The bedroom in the garage, basically, you added a bedroom, which made the garage way smaller.

George:
The person did.

Brandon:
Oh, the person did, okay. So, that made people feel weird about the house.

George:
[crosstalk 00:16:44]. Yeah, it looked like a full garage, but you lift it up, it was a half a garage. So, that’s what messed that deal up.

Brandon:
But it was also a two-bedroom house, not a three-bedroom house because that third bedroom was in the garage, right?

George:
It was not in the garage. They converted the garage into a third-bedroom.

David:
Gotcha. Gotcha.

George:
So, now you have a bedroom. So, it was a three-two, basically.

Brandon:
Yeah, makes sense.

George:
What made me in the first place want to sell the house was I was listening to the podcast, and people were always talking about buying a duplex, living in one side and renting the other side out. So, immediately at my job I had this three-bedroom two-bath house. I had bought a dog. I had two cars. Two car payments, and we was going to work. Me and my wife both working at the post office. We go into work, we come home, we eat dinner, go to sleep, do it again.
And I was like, “This can’t be the rest of my life,” like adulthood. I was really stressing out. Not stressing out, but I was like this can’t be the best part of life. So, I listened to the podcast, they say, “You can live for free if you buy a duplex.” So, I sold the house, I got this money in the bank, now I’m looking for a duplex. And I thought it would be easy to find a duplex because you’re looking for it, but every duplex came up, the numbers were not working.
So, I come across one day, I’m just scrolling MLS… Not MLS. I wasn’t a realtor at the time, but I’m scrolling on realtor, and I see a house. It says mother-in-law suite. So, I said, “Maybe that’s the word.” So, me and my wife, we called the realtor, booked the appointment. We came, looked at the house, and immediately I looked at the whole house, and then we went and looked at the mother-in-law suite, and the mother-in-law suite was completely brand new.
The old house was kind of older, but the mother-in-law was brand new. I’m like, “This is perfect. I can rent this part out and live in the big part.” So, we ended up putting an offer in on that house, and that’s what got me able to save up money because now I’m living in… I got my house. I’m living in the house, but we Airbnb’ed out the mother-in-law suite, which it covered the entire mortgage. So, basically, we’re living for free at that time.

Brandon:
That’s awesome. I love the Airbnb house hack strategy. Right now, in this time of COVID, at least in a lot of areas it’s not necessarily the best idea, but I’ve always loved it, and I still will always love that strategy because it’s just so solid. You’re living in the unit, so it’s easy to turn it over. You can do the work if you want to. You can hire a cleaner if you really don’t want to, and you just get more rent, ideally. And you’re paying for your own internet anyway, so it’s like they can have the internet. You’re paying for your own water anyway, so who cares if the extra unit has that. So, that’s smart.
Yeah, that whole house hacking thing, that’s why David and I talk a lot about it because once you’re living for free, now you can legitimately save money versus all the financial pundits out there are like, “Don’t drink your coffee every morning and you can save 12 cents a day. And after 89 years you’ll have enough to live on social security spam.” I don’t know, that’s like the common advice.
All right, so you buy this duplex, or this house with the mother-in-law. Which by the way, is a fantastic tip for people. When you’re looking on realtor.com or Zillow or Trulia, look for those things. You can even set up keywords with things like mother-in-law or ADU or those terms that a lot of agents don’t even realize what they’re putting on the market is a big deal because they’re just like, “Ah, whatever. Most people aren’t going to want that. They don’t want to be landlords.” They don’t realize that that is a gold nugget from somebody.

George:
And the lady I bought the house from, she didn’t even rent that part out. She used the whole house, and it was by herself. So, if the mortgage was too much, that was the perfect opportunity to rent that part out. And that’s what Brandon always talked about too. Listening to the podcast, I felt like I had every tool belt to conquer any deal. So, when I seen that, I seen dollar signs. And it worked out perfect, because once we started living there, and the Airbnb is up and running full, we became a Superhost.
We became a Superhost, so it was just fully rented out up until COVID. That kind of slowed it down, so we just turned it into a regular rental, but that was the starting point to saving money because you can’t be a real estate investor without learning how to budget and save money first. That’s the first step to even thinking about becoming a real estate investor.

Brandon:
Do you have any tips for people who want to do that? They have a duplex or they want to buy a duplex or a house with an ADU, and they want to do the Airbnb thing. What have you learned over the past few years of doing it and trying it out? What worked? What didn’t work? What advice can you offer?

George:
I can say for your first time, if you find a duplex or a house with an extra guesthouse on it, some of the things I would say is it was my first time becoming a landlord really. So, I learned that one thing for Airbnb is a smaller place is easier to manage. So, I also have a three-bedroom Airbnb, and the difference is if you have a mother-in-law or a little one-bedroom place for Airbnb, it’s much easier to clean.
Because, for Airbnb, some people will book a three-bedroom house and say it’s one person and then 10 people show up. So, you’ve got a lot of mess to clean up. I found out Airbnb for me, I like smaller space. And then also, as far as being a landlord, you have to get the right tenant in there. On Airbnb, I have people that book for a month, and then in my case, I’m in a quiet neighborhood. So, a person will book it and they like to sit outside and drink or do outdoor activities, and this type of neighborhood is not for that type of environment like a beach house or some beach Airbnb. It’s more like a person who is working in town. They need to rent it out.
So, you need to let the person who’s booking it know more details than what you expect. Like if you don’t want no smoking outside, which I don’t like, you need to let the people know because it becomes a hassle because you’re living on that property and you’ve got to sit and deal with them people.

Brandon:
That’s really good advice. I mean, that applies to all landlords. It’s just like establish upfront your criteria and like, “This is what we allow, this is what we don’t allow.” And it just makes the whole process so much easier. It’s in writing. You can be like, “Hey, look man. You signed this thing.” Or, “I said this in the listing ahead of time.” It makes management a whole lot easier when you manage their expectations up front.
So, yeah, very cool. All right, so by the way, what market is this in? Was it-

George:
It’s a small town, Vero Beach, Florida. It’s probably an hour north of West Palm Beach or an hour from Orlando. Have you heard of that?

Brandon:
Oh yeah. Yeah, I love Orlando. I love Disney World, come on. So, is this near the… Are people staying here because they want a beach vacation? A lot of people are thinking, “I’m on the beach in Florida, I can’t have a vacation rental.” Is that what yours is?

George:
No, Airbnb is for people… It’s almost cheaper than a hotel. In my case it’s a studio apartment basically, mother-in-law suite. So, people that book it for the most part they’re traveling. They may be going to weddings or… I’m like seven minutes from the beach, so I don’t really advertise that it’s a beachfront property, but if you want to drive to the beach, you’re not that far away.
Airbnb as far as before this, it was just people book it because it’s more convenient than a hotel and you can almost live like a local rather than living like a visitor sometimes.

Brandon:
Yeah, I think that’s a huge misconception when it comes to vacation rentals or short-term rentals, is they think you have to be at Disney World or whatever. But if people travel to your place. If there’s any hotel in your area, you could likely have a vacation rental or a short-term rental because people are obviously traveling there. If there’s a hotel for business or for weddings or whatever. Yeah, I think it’s smart.

George:
Right.

Brandon:
All right, so what came next?

George:
So, all right, I’m saving money in this house, and while I’m at the post office, this is the perfect job for a real estate investor. It was like a disguise with God, because if I wasn’t in that mail truck, I wouldn’t have learned the market like I know the market now. So, I’m driving literally every street, every road, and I’m paying attention. I’m listening to podcasts, so I’m listening to people who are doing real estate, but I started learning what the rent for… I talked to every landlord on my route. I was like I could recognize the landlord. I recognize them.
So, I’m getting advice from them, and my next deal was I’ve seen a house, a guy standing outside. It was a vacant house, and I stopped in the mail truck. I pulled over, I walked in the house, I said, “Hey, this your house?” He was like, “Yeah, I’m in here in town from Oklahoma. I’m fitting to auction it off on Saturday.” So, I said, “Wow, I might be interested.” So, he said, “Yeah, show up to the auction on Saturday.”
Well, I work on Saturday. I hope the post office is not listening, but I don’t work no more. But I made my route where I basically, when the time came near, I made it so I was by that house.

Brandon:
Wow, that’s awesome.

George:
So, the auction was like 10 o’clock. So, I was doing my route, doing my route, and 9:55, I made sure I was right there in front of the house. So, it’s maybe 10 people out there, they start the auction off, and I told my wife not to go over 49,000. We were there together. And the auction get up to 48, 49. I don’t know how to stop bidding. That’s my hardest part. I have to have my wife, “All right, this is the number, I’m telling you now. Do not let me go over it.”
But I said 49, I ended bidding up to $52,000. And it’s a auction. Certain auctions are the owner don’t have to accept the deal. So, basically it ended at 52,000. The owner, he accepted the offer, but the auction company, they thought that the owner would not accept the offer because he was expecting to get like 70,000 from it. And they were like, “We would have bought it if he was going to sell it for that low.”
So, I had 30 days to close on it, and I had a line of credit already set up. And basically, I bought the house for $52,000 and then after I bought it, I was planning on going to the bank to get a loan on it. But at the time I could not get a loan, so I was like, “I guess I’ll just sell the house.” So, I put it for sale like it’s 80,000 and it ended up selling for 75,000. It took like two months, and I made-

Brandon:
Wow.

George:
Yeah, it was almost 20 grand right there. And I was like, “That was crazy. I only make this…” At my job it take me… After taxes you make like $35,000 a year. This took two months and I made this much money. And I didn’t have to do anything to the house. I sprayed air freshener in it, trimmed up the front tree, and it was ready to go. And that was my first flip and making that type of money.

Brandon:
Can I bring up a point here real quick? What I love is that what you did there… Some people might be listening to this going, “Well, you were a mail carrier, so you were driving around. Of course, you saw that deal when it came up.” But the truth is we all drive around all the time, we’re going places, right? So, what I would advise people is don’t think that you were a mail carrier so you were driving a lot, but every time you drive, are you looking for those opportunities?
And then most importantly, are you getting out of the car? What you did that most people will never do is you got out of the car. You saw a person at a vacant house, and you went and talked to them. You got out of the car. And so, 99% of people I talk to that want to get into real estate will never get out of the car. They want it handed to them. They want an easy deal. They don’t want to have to talk to people, they want things simple. And it’s not like it’s hard to talk to people, but we all just don’t do it. And so, I just wanted to congratulate you on getting out of the car and doing it.

David:
And you may not be driving around looking at houses, but how many people work with others at their job and they never talk about real estate to them. It’s easy to say, “Well, George sees houses driving around in his mail truck.” I would argue George is at a disadvantage not talking to hardly anybody being isolated in a truck all day. I mean, he gets to listen to podcasts, but you don’t get to talk to people and tell them, “I want to buy a house.”
If you work in an office with 50 to 100 people in it, you have the chance every day to talk about real estate and have one of those people come say, “Hey, my friend’s grandma just died. I think that they want to sell the house off market.” All kinds of opportunities come up and people won’t take them. They won’t do their equivalent of getting out of their truck and going to engage with somebody, so props to you George for doing that.

George:
Yes, and also David, by the time I started listening to BiggerPockets, I had all the mail carriers, “You have a duplex…” Because I was really interested in duplexes. So, I’ll tell all the carriers, “You have a vacant house.” They was writing the address and we’d get back to the office at five o’clock and they give me the piece of paper and I’ve got seven addresses on it.

Brandon:
There you go.

George:
So, I was letting everybody know what I do. And the key… I mean, one of the parts of my success, I think, is when you talk to a owner, a lot of times I talk to the owner and they want to help me sometimes. Or it’s just we talk and we just have a common bond and they make the deal happen.

Brandon:
Yeah, I love the tip, and I’ve heard of other people saying this on the podcast before. I’ve never done it, and I’m sure you’ve heard it as well George, it was like, “Yeah, talk to your mail carriers. They see every house in the neighborhood.” So, like, “Hey, you see any vacant houses or houses that are looking like they’re distressed? You see anybody obviously going through foreclosure, let me know.” Maybe even offer them some kind of piece or something. Have those conversations with people who are in the… And it’s not just mail carriers too. It’s anybody who just drives around a lot for their job. Talk to these people and get them hunting for deals for you.

George:
So, you had a guy on your podcast, right? He was a wholesaler in my area, and I was like, “Wow, this guy’s so close to me. Let me reach out to him.” So, I reached out to the wholesaler, and he immediately… He was like, “Okay, that’s great. I can help you. I have a course, two or $3,000.” Not two or 3,000, but $2,000 and I’m like, “It all sound the same to me. I don’t have that money to invest in a course right now.”
So, he said, “How about this? You’re a mailman. Do you have any vacant routes on your route?” I was like, “Yeah, I’ve got a lot.” And he was like, “I’ll do you a deal. You give me the vacant houses on your route and I’ll help you out.” So, the next day I’m excited. I’m probably misdelivering mail because I’m so worried about looking for the vacant houses. So, I’ve got my notepad on my phone pulled up, and I’m driving. It probably took me after hours just to do this route because I keep stopping to put these vacant houses in my phone.
So, I had 50 houses. I emailed it, texted it to them the next day, and he said, “Great. Thanks. If I buy any of these houses, I’ll be in touch.” So, time go by, like a month or two. Next thing you know, all these houses that I sent the person, they’ve got trucks out there ripping off the roof, ripping out the windows. I’m like, “Oh my gosh.” But I never heard anything back, whether he bought it or not. But it was just like you try so many things with people, but everybody, it got to benefit them at the end of the day, I can say.

Brandon:
Yeah, it’s cool… First of all, I like the fact that you found a way in your life to bring value to somebody else. Now whether or not it worked out or not, we’ll never really know. Whether or not they bought one. But just the fact that you went out there and you were like, “Well, I don’t have the money for a course and I don’t want to spend that. So, I’m going to find some way to bring value, and that’s a good way to do it.”
And then I want to actually just bring up what you were doing there. Something that we call driving for deals around BiggerPockets, or often called driving for dollars. And there’s apps that can help with that. There’s an app called Driving for Dollars, there’s another app called DealMachine. They’re both awesome, they can simplify that process. But all you’re doing is exactly what George is doing, right? Get in your car, drive around, look for vacant properties. Or if you’re looking for multifamily, write down the address for every multifamily. If you’re looking for apartments, write down the apartment address, whatever.
You’re just looking for properties and then you go and contact them later. Whether it’s what, you’re going to mail them letters. You’re going to look up their phone number, find out who the owner is. There’s all these fancy tools now that can do all that work. It gets you really, I guess, into deals that most people won’t do because most people just want to sit at home. They don’t want to get in their car. They don’t want to get out of the car. They don’t want to do the work.
So, that definitely applies to every single person here. Especially if you don’t have a lot of money right now, that is a strategy everyone can do. For the cost of a tank of gas, you can drive around three, four, five, six hours a week, every week for the next three months. Write down every property or use one of those apps. Write down every property and then start contacting those owners. If you get 100 properties or 200 on your list, you will buy some of those properties if you’re consistent and persistent with it. I really believe that.

George:
Right. And one of the things people can do to find deals is… Because I know mailing out letters, you guys talk about that all the time. I don’t know the percent of that, but I haven’t got a deal like that. But if you just tell everybody what you do. I told all my coworkers, the babysitter, uncles, aunties. If you tell people what you do, it’s always somebody in a situation where they need to get rid of a house.
So, oftentimes deals are just coming from… If you can talk to the seller directly and they want to sell you the deal, it’s so much easier than going back. If I’m trying to buy a house from David, and he’s trying to make a $30,000 profit, and I’m trying to get a good deal, he don’t really have no… He’s trying to make his money to move on. But if you have somebody who they’re older. A lot of people I buy houses from are 70, 80 years old, and they’re just looking to get their money, and they’re tired of rental properties basically.

Brandon:
Yeah.

David:
Yeah, that’s something that’s easy to forget that we spend all our time saying, “How do I find a deal? Where’s the deal? How do I get a house?” And there’s a lot of people that are thinking, “I wish someone would just take this problem away from me. I don’t want to own real estate anymore.”

Brandon:
Oh. So, I got an analogy for you. Are you ready for this one? Wait, I might have already told you this one, David, but-

David:
Well, it’s too late now. You’re committed.

Brandon:
Now, I’m committed, so I’m going to say it anyway. If I said it on a previous podcast, I apologize to everyone, but I’ll say it again. Because I was actually proud of this analogy. I put it in my new book The Multifamily Millionaire.

David:
Wait, you just set yourself up to quote yourself, didn’t you? You said, “I have something to say. I might have said it before, so let me give myself credit for my quote that I’m about to say that I came up with.”

Brandon:
No, all I’m saying is I-

David:
Nicely done, Brandon.

Brandon:
No, listen. Listen man. I put this in my book, and I thought, “This is a really good analogy, and now I’m going to use it in the podcast.”

David:
So, it’s an author that you’re quoting. I see.

Brandon:
I’m quoting… Yeah, there’s a really wise author.

David:
It happens to be yourself.

Brandon:
There’s a really wise author. Shut up, let me tell you the story. All right, so the analogy is, and now the more I say this, the more I think I said this on a previous podcast. But the other day I woke up with a headache. This happens multiple times. I wake up with a headache, and I’m like, “Ugh.” It’s just a dull headache. It’s not terrible, but it’s not that it’s annoying. I drink some water. I get some food. It just kind of gets worse throughout the day, and it just gets worse and worse until later on I’m laying on the couch miserable. My head’s pounding, and I’m just laying there like, “Oh, come on.” It doesn’t happen that often, but when it happens it sucks, right?
Then my wife walks in the room and asks the most annoying question in the world, “Well, did you take any medicine for it?” And of course, I’m like-

David:
No.

Brandon:
“No, I haven’t taken any medicine because I never even thought about taking medicine. I’ve had this headache. It comes on slowly.” Had it been like boom, you’re in pain. What do we do? We go take medicine. But instead, because it came on slowly, this is exactly what… It’s not an annoying question. I love my wife, but because she’s so right. She’s so right, but I didn’t think of it.
The same is true for landlords, right? They get this growing headache that just grows over time. And they don’t think about it as a headache, they just are annoyed by it and annoyed by it. And when you show up and be like, “Hey, I’ve got some ibuprofen here for you.” All of a sudden they’re like, “Yes, why didn’t they think of that? I’m so stupid.”
So, in other words, when you contact existing landlords, a lot of them have headache properties. Multiple headache properties. And you contact them like, “Hey, what property do you hate the most? What one causes you the most drama, has the biggest repair needs? Which one is your biggest headache, and would you be willing to sell it?” If you were to ask me that question today, I’d be like I can name exactly about two or three of my properties that I’d be like, “Yeah, let’s have a conversation about selling them right now because they’re headaches of mine.”

David:
Absolutely.

Brandon:
But I haven’t thought about it all. Okay, David Greene on a one to 10 analogy scale, the DG analogy scale, which is an official thing now by the way. At BiggerPockets we talk about analogies in terms of where they rate on the DG scale. So, on the DG scale, one to 10-

David:
From one to David Greene, how good is this analogy?

Brandon:
Yeah, exactly. On a one to David Greene, how good is this analogy? It’s pretty good, right?

David:
Well, I’m going to give it a high score, seven-and-a-half, particularly because you used headache in both the analogy and the example. I thought that was a good mix.

Brandon:
Thank you.

David:
You could have improved it had you brought up the frog in the boiling water that people make. If a frog just sits and you slowly increase the temperature, I don’t even know if that’s real, but people say the frog will let itself-

Brandon:
It’s not a real… But, yeah.

David:
Oh, that’s probably why you left it out because you use science-based analogies. All right, thank you, Accurate Andrew over there. Yeah, that’s really good, and a point I wanted to make was you also should remember, part of the power of real estate is over time. Over time, it is a powerful wealth building tool, but if you’re older and you’re kind of at the end of your time or coming closer to it, there’s not nearly as much appeal for you to own that thing as someone else. At the end of your life you just want convenience.
So, when you’re starting off investing, you are happy to sacrifice convenience for wealth and for time, and that’s why Brandon carries toilets that are actually literally full of poop, because he doesn’t mind when he’s young. Whereas, when you get older, it’s not worth it to do that. You’re happy to sell it to a Brandon and let him carry out your poop.

Brandon:
Yeah, [inaudible 00:37:02]. All right, George, let’s go through the rest of your story. If you want to fill out what happened the next few years. Where are you at today? How many units do you have? Kind of walkthrough with the… And how you became an agent. I know you mentioned that.

George:
All right, this is the crazy part. I stopped working last year in May, so I’m fresh off the press, if you like. I’m 31 years old now, and I quit working when I was 30 years old. So, it was on a Monday at the post office. It was a crazy day. I mean, mail was through the roof, and I was frustrated. And when I got home that day, I had a headache, I wasn’t feeling good, and I was like, “Man.” I had to use the bathroom. So, when I used the bathroom it was like blood in my stool.

Brandon:
Oh, no.

George:
So, it really scared me. Yes. So, I’m like, “What is going on?” I told my wife. She was like, “Let’s go to the hospital.” Went to the hospital, and they were like, “Hemorrhoid.” I had bleeding, so no big deal. But on the other part, it was like you still need to go get checked tomorrow to make sure cancer. Cancer come in people’s stools, you know? So, I’m like, “Huh?” It scared me. I’m telling you, I’m scared.
I called the post office, said, “Hey, I had to go to hospital. Such-and-such happened.” They were like, “Are you coming into work tomorrow?” I’m like, “I just told you what happened.” And it felt like they didn’t really care what happened, I need to come do that route tomorrow. So, the next day we made an appointment for nine o’clock in the morning, my wife called my work. We’re driving to the hospital and listening to the podcast.
A lot of times when I see… Say I see, I want a Ford truck, right? Next thing you know, I start seeing a lot of Ford trucks, right? It just happened like that. So, I’m driving to the hospital and I start seeing words saying cancer. And on a big old sign saying cancer. I’m like, “Oh, man. I keep seeing this.” So, I said, before I went in there, we prayed and whatnot, and I was like, “God, if I don’t have it, I will follow my purpose and my passion and my dream.”
So, we went in there, they did the test whatnot. Doctors walked in, he was like, “I got good news. You don’t have cancer.” And it was like, “I’ve got to really live up to what I just told God.” So, it was like the next day is like a Wednesday. So, I called out for the rest of the week because I had a hospital whatever.
So, next week, we go out of town that weekend and come back, it was Memorial weekend, that Tuesday. It’s like Monday night, three o’clock in the morning. I’m supposed to be at work at 7:00 in the morning, and I googled, “Would God tell me to quit my job.” I literally googled this, because I’m going back and forth because I’m like I got this, I just had my first son, he’s one years old. Just like everybody in the world I have responsibilities. So, I’m like, “He can’t tell me to quit my job.”
So, I turned on the TV, and you know the infomercials they have on in the middle of night, and it was a pastor. And he was like, “The answer to your question is yes. The answer to your question is yes.” And I had just googled, “Should God tell me to quit my job?” So, it scared me because I’m like… I threw my phone, I put it on the nightstand, and I said, “That’s it.” I like He answered my question so quickly, because usually people want bright signs to see things, and that was the brightest it had ever been. I was like, “I need you to be loud like if you don’t want me to go to work, when I go outside all four tires need to be flat.” That’s the type of sign I want.
So, when He said, “Will you be all right? Yes. Will you be able to survive? Yes. Will you [inaudible 00:40:26]? Yes.” So, that morning I woke up, I made sure I quit. I took all my post office clothes and put them in a trash bag. Took them, threw I’m in the dumpster. So, I didn’t have no clothing where I worked now. So, I’m basically eliminating, because I was still scared-

Brandon:
You’re burning your ships.

George:
Yeah, I basically burned the ship. So, I waited a couple of days and then finally I was like, “All right, I’m going to take my two weeks’ notice in.” I walk into the post office, people like, “Where you been? Where you been?” And I had the letter, and I had wrote on the letter, I was basically, “I just can’t do it no more.” And the supervisor, she gave me the look. Most managers at jobs, they’re doing their job. They want you to get the job done, but they know they’re going to overwork you to get it done and that’s their job.
I’ve got workers working right now doing floors at our house, and my job is to get them to do as much as I can for $10-12 a hour. That’s just-

Brandon:
That’s your job.

George:
I’ve hired them, that’s my job. So, she knows as a mail carrier, we want you to deliver as much mail as possible for the smallest amount of time because you cost the post office less money. So, she almost gave me a look like, “I’m glad you did it, because I know I’m putting a lot of pressure on you guys, but you took the chance and left. I’m proud of you.” So, I felt some kind of relief about that, but that was the end.
So, the next day, honestly, I was like, “All right, what I’m going to do?” I went to the library and I started applying for jobs. I was so scared.

David:
So, you burn the ships and then you went and cut down trees. You’re like, “I’ve got to build a raft. I need something.”

George:
But my deal was, all right, because I had basically been saving up money because of the house hacks. So, you’re going to just quit your job. I did have a nice savings because I’d been living for free basically two years, saving up. No mortgage, no car payments. So, I could survive for a year at least. So, I went to the library, I was like, “All right, BiggerPockets say at least if you do a job, you’re not getting paid as much, but I’m happy.”
So, I applied for a property management job. I got my real estate license and I know I can manage the property because I helped my dad when he managed his properties. So, I got an interview, and the lady, she told me, “You go through the interview.” And long story short, she didn’t hire me for the job, and I felt like I was qualified. So, I’m like, “That’s it. I’m not applying for no more jobs.” I always had interviews and I wouldn’t get the jobs. So, I was like, “I’m not applying for no more jobs,” and I basically, I put my head down and I bought my next deal.
I quit in May. I bought a duplex in September. I bought another house the next month after that, and then February I closed on two more properties. So, it was just kind of like, you’ve got to trust your instinct. God… The universe works in your favor if you’re supposed to do it. If I’m trying to run a marathon and I’m running every day, they’re going to schedule a marathon in your city maybe. It’s going to give you the opportunity to do it.

David:
I was going to say that when I’m in a similar situation to yours, because I think a lot of people listening can relate to just the question of whether they believe in God or not. Should I do this or not? There’s this internal feeling of is this the right move for me? Whether you attribute that to God or fate or the universe. But we all relate to that feeling, and I see a lot of people that handle it the wrong way, where they’re asking, “If this is what I’m supposed to do, make it a downhill path. Make it easy for me to go that road,” and if that’s not what happens, then they say, “I’m not supposed to go that way.”
But how I see that play out in my own life is that I don’t see the path go downhill, I feel a drive come inside me that likes that it’s hard. I feel this version of David that rises up and says, “I want to lift that weight. I want to run up that hill. I like that it’s really hot right now.” Yesterday… Actually, it was Saturday, I did 14 miles and it was about 100 degrees, and it was up the mountain and then running down. And it was really really hard. I had to bring a lot of water, I had to hydrate halfway through, but there was a piece of me that was glad it was hard.
I can’t describe it, but I was glad it was hard. I can’t describe it, but it was like there’s a little thing that rose up because I knew this is where I’m supposed to be. I’m supposed to be strengthening my legs and doing this hard thing, and that’s how I know it’s where I’m supposed to be. It’s not that it’s easier, it’s that there’s a piece of you that really wants it, and I know there’s people that are listening to this that have that same, “I know I’m not supposed to do what I’m doing, but I don’t know what I am supposed to do, and can I get a sign.”
What you’re saying, I know strikes with a lot of people, and I just want to say don’t wait for someone to make it easier for you. Wait for that feeling inside that says, “I don’t care if it’s easy. I want it so bad, I’m going to go do it.”

George:
Right. And that’s the thing. A lot of people… Even me, I compare my life to Brandon. Before you had a million doors Brandon, maybe when you had 50. I was like, “Brandon got 50 doors. I’ve got to get 50 doors.” But in my real life, around my surrounding nobody really got that many rental properties. So, I’m comparing my life to Brandon and people on the podcast and I’m putting a lot of pressure on myself. And I was like, “Ah, that’s kind of…” I mean, you don’t ever feel satisfied.
But now, I feel like I’m moving with the earth. I’m moving at my pace. The deals I get are the deals I’m supposed to get, and the fact that I just really didn’t want to go to the job. I’m just happy already, so I feel like now I’m working for my wife to get out of her job. My family, my parents to stop working.

David:
Let me ask you this. You left the mail route, you burned your boats and then you went and became a realtor. How’s the realtor thing been working out?

George:
As a realtor, so far… I’m not the realtor that’s going to be on the top 50 list, but I got my real estate license to help me as a real estate investor. So, as a realtor a lot of times, for me, I get sellers that want to sell their house. So, they want to sell their house and I go view the house. When I go view the house, if it’s meet my criteria, I always put an offer in first before I list it. I got maybe two or three properties just like that, because people called me that want to sell them, and I go to look at them and I’ll be like, “Hey, I can buy this house. I have a lender and I know it need this done, this done. Are you okay with this price?”
And a lot of times they’re like, “Yeah.” But sometimes they’re not, and if they’re not willing to let me buy, I will still list it for sale. But as a real estate agent, people always say is it worth getting your license? I don’t think it’s worth getting your license, but I feel like it’s my calling to be in real estate because I help so many people find rental properties or sell their houses, buy their houses. And I haven’t had a deal not go through yet.

David:
Yeah, you and I have a similar story because I left my W-2 job in law enforcement, and at one point I felt like that’s where I was supposed to be and it just went away. And I felt like I was supposed to be in real estate. Now I’m selling houses and I know it’s not something I ever thought I’d do, but it feels like where I’m supposed to be.
And to Brandon’s point, it sounds like you’ve just taken listings and added them as a tool to your tool belt. “Okay. Well, I can’t take the deal down with bird. I can’t take it as a flip. I can’t take it as a rental. They won’t sell it to me. I’ll just list it for them.” Just another move you have in your repertoire that you can take down more deals. And for those type of people, it makes sense to be a realtor. But I agree with you that it doesn’t make sense to go do it unless you’re committing like, “This is going to be my full-time job and this is what I’m supposed to do.” It’s definitely not something to undertake lightly and just think, “Oh, I’ll just do this. How hard can it be?”

George:
Because the mistake people make is they see David making money doing real estate. So, then they say, “Hey, David. I’m thinking about getting my real estate license because I’m making money.” And people come up to me saying they want to get a license, and I feel like… Like me, I never did good on test-taking. I was like I failed state tests, college tests and stuff like that. So, my real estate license, I passed all them tests. So, it’s meant to be. I passed them tests. I never failed a real estate test for some reason. I don’t know how I passed, but I passed them. So, I feel like it’s destined.

David:
Brandon, you kind of mentioned that when you went and moved to Hawaii, right? It was a similar feeling.

Brandon:
What’s that? The [crosstalk 00:48:24]-

David:
That you were supposed to be there.

Brandon:
Yeah.

David:
You mentioned that, “It just feels like this is home. This is where I’ve been looking for, for my whole life.”

Brandon:
Yeah, I like to say, there’s that line in C. S. Lewis’s The Last Battle. There’s a book by The Last Battle, and it’s basically an analogy for the end of the world. And so, the world ends and these kids, the story… It’s like a kid’s story. They see this new place. It’s basically synonymous of the afterlife or supposed to be. And they say, “Hey look, it looks like our house, but it’s like a more real version of our house.” And then they’re like, “There’s the corner store where we get ice cream. It’s like a more real version of our ice cream.”
When I found my house here, it was like, “Oh, that’s the life I knew was there, but this is a more real version of my life,” is what I’m trying to get at. It feels more vivid, and certain areas of my life have been that way. And I think that’s kind of what you’re saying here. All of a sudden you feel like, “Oh, that’s what I’m supposed to do.” That’s when you find your purpose or your identity or where you’re supposed to be aligned in life. It gives you energy, the lights just kind of move green. It doesn’t mean it’s always easy, you still have to drive the car, but the lights tend to turn green a lot more because that’s where you’re supposed to be.

George:
Yeah, because a lot of deals I had, it takes five-six months to close, and I feel like if I didn’t love this I would have gave up. So, if you didn’t love it, you would be like, “No, I’m tired of this. I’m out.” But that’s one of the reasons.

Brandon:
Yeah, before we go to the real deep dive, I want to comment about one thing. This show is a lot about, we’re talking a lot about quitting your job. And you quit your job and then you’re kind of freaked out like, “Oh, I’ve got to go find something else.” And then you tried applying and it didn’t work out. I want to bring up a couple of points here.
First of all, real estate is a good way for people to quit their job. However, you have to have income to support your family, right? And you knew that, and that’s why you freaked out a little bit, and you decided to go the real estate agent route. You also had the thing that a lot of people forget, and that’s, you were responsible for a number of years with saving money so you could take that risk and quit your job. And then go into real estate full time. So, I’ve heard people who have nothing and they’re just completely brand new. They just get excited and they quit their job right then with no savings.
I would argue that that is… I don’t want to say foolish because I’m sure those people have done good and had success, but it is very risky to have no money whatsoever, which is why David and I are such big fans of house hacking. The more you can eliminate your expenses, so you can A, save more money and have fewer expenses, the quicker you can quit your job. But if you’ve got to buy the new car, you’ve got to have two cars in the driveway that both have car payments on it. You’ve got to have the nice house with the $3,000 a month mortgage. You’ve got to have all that stuff, the payment on the couch and all that stuff in your life adds up to payment and that holds you back.
That’s the shackles you put on that hold us back from actually freedom and financial freedom in life. So, I just encourage people. Look at your stories. Look you didn’t go out there and go buy the biggest, baddest nicest house. I’ll just encourage people. Save the money. Do it right. Keep your expenses lower. That’s how you get financial freedom. That’s how you get out of the rat race and that’s how you get into a really amazing life. Your purpose in life like we’re getting at.
Now, before we get out of today’s show, George, I want to move over to one of the last segments. I think we got two more, but second to last segment, which we call our Deal Deep Dive. These are the same questions we ask every guest about a particular deal that we’ve done. Do you have a property in mind that we can tear into a little bit, in a good way, George?

George:
Yes.

Brandon:
All right, number one. Yeah, what kind of property is it? What is it?

George:
The first property was a duplex.

Brandon:
Okay.

David:
How did you find it?

George:
All right, this duplex, it went up for auction. A live auction too. This is one you stand outside and bid on.

Brandon:
Oh, this is that one. Yep.

George:
Yeah, these kind of auctions. We still have them here. So, I went to the auction and I knew my number was like 65-70,000. So, we’re bidding, bidding. It went up to 75,000 cash. You have to close on it. You don’t get your money back for your 10% down. So, I bid up to 65, somebody outbid me. I was just hurt because this is one of my first deals after I quit the post office. I knew I needed a duplex for some income.
So, I had a headache that day because I knew I should have went up, bid higher, but I stopped. Because it’s in the moment. When you’re bidding, you don’t want to go too high and make a mistake because no inspection or nothing, I’ve got to buy it. So, I stopped and I didn’t get it. Maybe two weeks later, the duplex come up on MLS on Realtor. I was like, “Wow.” So, it was listed for $110,000. I called the agent. At this time, I’m a realtor. I called the agent and I said I want to put an offer in for $90,000 because now I can finance it. I can pay higher. I can just finance it.
So, he was like, “All right cool.” The seller came back at $100,000. I didn’t want to go that high, but I was… I didn’t say I was desperate, but I really really wanted a duplex. So, I went up to the $100,000 and I said… No, we came at $97,000. I told the other realtor he could keep my commission. That’s another trick for people who are realtors. A lot of times I don’t even get commission. I give the other realtor my commission in order for them to make the deal come to me.
So, I did it, I think 97,500, something like that, and he’d keep the whole 6%. And he was like, “We made it happen.” So, we under contract. I get the inspection done. Inspection. Just regular inspection, nothing major. But the appraisal come back at $78,000.

Brandon:
Woo.

George:
You want me to keep going?

Brandon:
Yeah. Well, the next question is how did you negotiate it then?

George:
Oh, okay. Yeah, so the appraisal come back at $78,000. I’m buying it for 97,500, and the appraisal come back at 78,000. So, on BiggerPockets I had never heard this happen before. So, I was stuck. Out of all the podcasts I’ve listened to, I still have things happen to me that I haven’t heard on the podcast. So, I’m like, appraisal’s come back at 78. I asked my broker and a couple of other realtors. They were like, “George, never buy a deal if it doesn’t appraise what you’re buying it for.”
So, I was like, “But I know it’s worth more than that.” I just felt like the appraiser, so I could test the appraiser, the bank, I tried to send the comps, and it’s still 78,000. So, a guy you just had on the show Mr. Rick Jarman, I called Mr. Rick, because I don’t have anybody in my circle here that got that much experience in real estate. So, I called Mr. Rick, I explained the situation. He was like, “George, I will pay $5-10,000 over appraisal if it’s worth it. If the numbers work, it rents, do it.”
So, what happened was once… I had leverage though, I didn’t realize it. Because the seller knew it appraised for $78,000. So, she ended up coming down to $85,000 because the whole point was, she couldn’t sell it because it appraised at $78,000. So, in the end, I shouldn’t even contest the appraiser because I had more leverage by saying it appraised at $78,000. So, she ended up coming down from 85,000 financed, and then I owner financed 5,000. So, it came out total to 90.

Brandon:
Wow. That’s a unique way to put that. Yeah, I like that you got the owner financing for the remaining five. That’s cool. So, how did you… Oh, wait. Sorry David, take it. I almost took your question.

David:
Well, you already started it Brandon.

Brandon:
No. No, I’m going to let you do it.

David:
What an honorable guy.

Brandon:
I’m an honorable man.

David:
All right, so we see that your seller finances a piece of it. How did you finance the rest of it?

George:
Okay. So, regular 25% down on a multifamily. I thought I’d just put 20% down, but multifamily, you have to put 25% down. So, I put the 25% down on the 85,000. And then the owner financed the 5,000 over two years with no interest.

David:
Thank you, COVID for creating this lending debacle.

Brandon:
Oh, yeah. Was this pre-COVID or after COVID?

George:
Well, no. This was back in September of last year. So, this is way before COVID.

David:
Oh, okay. I thought you’d just met Rick through the podcast and that didn’t come out-

George:
No, this was back in September of last year.

David:
Did he tell you that liars can number, but numbers can’t lie?

Brandon:
I love his Southern sayings. They’re so good. All right, what did you do with the property then? You held on to it?

George:
Yeah, so one side was vacant, and one of the things… Oh yeah, the number part you said. The MLS said it was rented out for $700. So, the final day before closing, I get the leases. I didn’t realize I should have gotten the lease earlier. I get the lease, and it’s rented out for $600. So, I’m like hold on, on the MLS it said it was rented for 700. So, the lease is for 600. But I still closed on the deal because the lease was ending in three months.
So, I closed on that deal and I rented out the other side, and here where I’m at, properties… If you start working, people see the shovel outside, some paint going on the wall, cars are stopping. So, it is no problem renting out. All my properties get rented out before I even put a for rent sign up.

Brandon:
That’s cool.

David:
Awesome.

Brandon:
Yeah, by the way that’s just a quick tip for everybody. There’s a thing called an Estoppel certificate or an Estoppel agreement. If you’re buying a property with tenants in place, before you close, during the due diligence period. Have the tenant… You actually have the owner have a tenant sign an Estoppel agreement, which says, “This is my rent. This is my security deposit. This is where my lease ends. This is if I have a lease or not. This is a month-to-month…”
You basically get the tenant to say also of the facts, then you can use that to compare to whatever the agent listed the property as and look for a discrepancy and renegotiate right then and find problems. There’s a good tip for everybody there, and it’s not very well-known, but there you go.

David:
Nicely done, Brandon. First off, usually only brokers and agents know about that. Second off, that’s a lot of syllables in one word. Estoppel, you got the whole thing.

Brandon:
Am I saying it right? I actually have no idea. I only read. I don’t talk good-

David:
Yeah, look at you. Stepping up your game.

Brandon:
Look at me. All right.

David:
It’s all that brain energy you’re saving wearing the same T-shirt every day-

Brandon:
Every day I save-

David:
[crosstalk 00:58:14] works better uses.

Brandon:
That’s what you do. You should try it. Anyway. All right.

David:
All right, George. What lessons did you learn from this deal?

George:
Oh, from that deal I learned… What’d I learn? I learned that I was so upset when I lost that deal at the auction, but just being persistent and patient, I ended up getting a duplex. And I don’t think I’ll probably ever sell a duplex because it took me such a whirlwind. Sentimental value maybe.

Brandon:
Yeah, I hear you, man. That’s an awesome story, I like that. I like the fact that you went for it. It was listed at so high. I don’t know if you call it negotiation, but that is negotiation is you got them down through the appraisal, and eventually you landed a great deal that now you just have and you rent out. So, what’s it renting for right now, each side?

George:
Each side is renting for 700 each side now.

Brandon:
That’s awesome.

George:
And I learned that negotiation… You had a guy on your podcast, a negotiator. He was like, “You always…” Say my highest I want to go is 90,000 and I tell the sob story of what’s all wrong with the house and you’re probably not going to like my offer, but I give you 80 for it, and it works. I never think… My dad always said, “Man, that stuff don’t work.” Because when we drive long distance, I make him listen to BiggerPockets.

Brandon:
Nice.

George:
This is before I started buying property, but he didn’t think the stuff on BiggerPockets worked. But I’m telling people the things that you guys say on here, it works. It really does work.

Brandon:
That’s awesome man. Appreciate that. Well, with that, let’s get over to the last segment of the show. A segment you’ve heard many many times before, now we’re going to ask you. Now it’s time for our world famous (singing).
All right, time for the famous four. These are the same four questions we ask every guest every week here on the podcast. And before we get into it, let’s see what’s going on around the world on the BiggerPockets Podcast Network.

Ashley:
Hey, it’s Ashley from the Real Estate Rookie, and on last week’s show-

Felipe:
No, it’s not. It’s Felipe from the Real Estate Rookie Show, and last Wednesday, we had Amy and Chris. A newbie and a seasoned investor who used hard money to invest, and they are in partnerships. Make sure you go back and listen last Wednesday.

Ashley:
Thank y’all.

Brandon:
All right, with that let’s get to the famous four. Number one, what is your favorite or current favorite or all-time favorite real estate related book, George?

George:
Favorite real estate book. I always have different phases I’m going through, but overall, I will say How to Get Rich in Real Estate by Robert Kent. I have it right here.

Brandon:
Oh, nice.

George:
This is an old book. I don’t know if [crosstalk 01:00:44]-

Brandon:
How to Get Rich in Real Estate. Yeah, I never read that one.

George:
Yeah, it’s the 15%. If it rents for 15% of what it costs… No, if it costs $100,000 and rent for 15 grand a year, that’s a decent deal. It’s simple.

Brandon:
Nice.

George:
It’s simple.

Brandon:
All right.

David:
All right, what about your favorite business book?

George:
Favorite business book, Doing Business by the Good Bible. It’s basically about doing business the biblical way. Once you listen to a lot of real estate podcasts, honestly, I don’t really learn a lot after listening to 200 episodes, but I pick up one or two things from each episode that I attach to me. So, that’s one part. But as far as just doing business, doing people right and wrong, that’s what I take from that book business. Doing it the right way.

Brandon:
There you go. By the way, I looked it up earlier because I thought there was something that related, you mentioned earlier. I couldn’t find the exact verse I was looking for, but Ecclesiastes 11:6, “Sow your seed in the morning and do not be idle in the evening, for you do not know whether morning or evening’s sowing will succeed, or whether both of them alike will be good.” That’s my new real estate quote of my life.

David:
Always be sowing.

Brandon:
Yeah, always be sowing. That’s going to be my shirt.

David:
Yeah, always be [crosstalk 01:01:52]-

Brandon:
ABS, Always Be Sowing. If you want to buy an Always Be Sowing shirt, go ahead to biggerpockets.com/shirt. Seriously, I’m going to make it. All right, with that, next question.

David:
Next question is, George, what are your hobbies?

George:
My hobbies are… That’s crazy, I do my hobbies every day now. I love real estate. But outside real estate I play basketball. I do have a podcast, New American Dream Podcast, and I have a family. So, my reason why I wanted to quit my job is I had my son. So, I had him April, it was 2018, and that one year just working, missing first steps and all that, that was my why I wanted to quit. I wanted to spend time with him. So, now I take him to daycare every morning, and that was my reason why.

David:
That’s awesome.

Brandon:
That’s awesome, man. Yeah, very very cool. All right, last question from me. What do you think sets apart successful investors from those who give up, fail or never get started?

George:
I want to say taking action, but the thing is, people remember your job is something you can get fired from. Your work is your purpose. So, find out what your purpose is in life and you can never get fired.

David:
Very nice.

Brandon:
Wise words.

David:
All right. This has been awesome, George. Tell us where can people find out more about you?

George:
You can find me on Instagram @georgedorealestate. I also have a YouTube channel called George DoRealEstate. I do a lot of things on there. And on my podcast New American Dream Podcast.

Brandon:
All right. So, George of real estate. Very very cool. And New American… It’s called New American what?

George:
Dream Podcast.

Brandon:
Dream Podcast.

George:
Yes.

Brandon:
Very cool. Everyone go check that out after this show’s done. And yeah, awesome man. Appreciate you coming on the show today.

George:
Oh, thanks.

Brandon:
David Greene, want to take us out of here?

David:
Yeah. Thanks again, George. It was great getting to know you. This is David Greene for George “Can’t Not Outbid” Gipson, and Brandon “A Wise Man Once Said” Turner, signing off.

Speaker 4:
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