Saw his article - can anyone explain it?

[Paul Doherty]

http://www.lifestylesunlimited.com/how_15_rent_houses_can_retire_you_faster_than_a_million_dollar_401k/

Can someone explain what he means when, for instance, he goes from year 1 putting 5k of saved money down and buying a house with a "hard money loan" (I assume that means a normal mortgage loan?), and then says for year 2 save 5k and extract 5k from the first house? What does he mean by that? How is he getting money out of the first house?