BP Podcast Math Error?

Question

I recently listened to the Podcast with David, Rob, and guest Yamundow. https://www.biggerpockets.com/...This woman is a truly exceptional woman that has accomplished some amazing things and overcome some incredible hurdles. I don't want to take anything away from her with this post.

The headline says $80K/mo in cashflow and they talk about it during the podcast. Even the veteran investor-hosts missed the far-fetched number. That surely is an amazing number, because that would mean your rent properties are putting almost $1M/yr in your pocket.

Hmm. That math doesn't seem to add up.

$80K per month cashflow across 34 units means the average unit is generating $2,350/mo in CASHFLOW. Admittedly, she had some small mortgages, she still has taxes, insurance, repairs, and vacancy expenses. Conservatively, you are looking at $4,000/mo in revenue per unit to achieve $80K per month in cashflow. While $4K might be a reasonable rent for the mid-term rentals, I doubt the Section 8 homes in Illinois and Ohio can bring in anywhere near those numbers.

Conclusion: The $80K/mo is more likely revenue, not cashflow

Elliot Wagner · Answer

The story is really incredible, and I wished it was true because I was very inspired, but it doesn't hold water. She claimed she had 16 Airbnb rentals, but she actually only has 6 and has some very negative reviews (unsanitary, deceptive listings etc) from guests and LOTS of empty calendars https://www.airbnb.com/users/s... She claimed $64K/mo cashflow from Airbnb ($80K - $16K/mo cashflow from section 8), but it looks like she only has one listing booked currently for about $1500/mo. After PITI and utilities, that's probably about $800/mo cashflow. Looking through the older guest reviews, it looks like she used to have some Airbnb arbitrage units in a building with a landlord that didn't allow Airbnbs, which I'm guessing got shut down and is why she now only has 6 listings. Her Furnished Finder reviews are likewise all 1-star reviews as well, with guest complaining about unreturned security deposits and misleading advertising https://www.furnishedfinder.co... IF the claimed section 8 cashflow is true, I estimate she is at most making about $17K/mo cashflow. That's great, but a far cry from the $80K/month figure. Also given these inaccuracies, I'm skeptical even the section 8 figures are authentic. She sells a $2K 4-week real estate investing mentorship program, which must be getting a nice boost in students from all the podcast viewers. It should help make up for the empty Airbnbs and shuttered arbitrage units.

Aleksandar Popivoda · Answer

I have a hard time thinking that Dave and Rob didn't catch this colossal misrepresentation. Having said that, this is not the first time that BP Podcast is presenting false figures and not bothering to correct them, even after some comments clearly call them on their BS numbers. I remember a show, a year or two ago, when a highly pumped-up guest claimed that after just one year of investing, as an inexperienced beginner, he jumped into serious fix and flip game, by doing 80 flips a year!? In no moment Dave asked him how is that possible and what exactly he did to scale that rapidly. However, looking at the content of the vast majority of comments under this YT video, we can see these are mostly people who come for inspiration and cheering, not for some serious RE discussion. I guess BP Podcast now mostly tailors their show to this crowd, there are more likes and views in that. Corporate strategy, I guess.

Nathan Gesner · Answer

Yes, people see a few podcasts, TikToks, or YouTube videos from an "expert" that tells them they can buy 50 houses a month with no money down. Who would turn that down? Very few new investors understand the successful investors actually worked hard, saved up, sacrificed, and took a long time to get where they are now.Everyone wants a short-cut.

Nathan Gesner · Answer

LOL! David addressed this recently in a podcast on a different platform. The reality is, nobody investigates the podcast guests to see if their claims are true. If they say they make $100,000 a month wholesaling in a town of 500 people, that's what the podcast rolls with.I've seen some guests over the years that have been pretty far-fetched. I remember one of the first podcasts I watched (probably in the first 100 episodes) where a young guy claimed to make $10,000 cash flow per month. About 2/3 of the way through, it was discovered that he was only counting his mortgage and interest, no other expenses. I could see a slight change in Brandon's face when this was revealed, but they kept rolling as if it wasn't an issue. When I take marketing pictures of a rental, I am trying to portray an accurate, visual description of the property but my intent is for the viewer to come see the property in person because pictures don't always tell the whole story. I see the podcast as the same. They give information they think is accurate, hoping it will encourage viewers to visit the page and learn the whole story so they can be better investors.

Jay Hinrichs · Answer

I am sure the best seller pod cast are the ones that are Hey I had no money and in 18 months I now have 30 units and you can do it to.. I dont doubt in some markets this could be possible but for most folks this is simply a pipe dream.

Travis Timmons · Answer

I made my first youtube comment ever on account of this $80k per month claim. The guest actually replied stating that she had 34 doors and 16 short term rental arbitrage units. It still doesn't add up. My guess is that she had 1 peak season month with $80k in "cash flow" and throws that number out there like it happens every month. I have an airbnb that does $21k/month in booking revenue. That's in July in a very seasonal market. Is it 100% false to say I have a short term rental that does $21k/month? Not exactly, but it is certainly not true. There's also a difference in accumulating doors and the quality of said doors. I could own 10-12 $50-75k properties by now but instead I own 3. It's irresponsible and sets unrealistic expectations. I suppose it is far less sexy to say that one is financially stable, on a slow and steady path, and purchasing a new property every 12-18 months.

Greg Scott · Answer

Sadly, this creates unrealistic expectations. Perhaps this is why we see so many people posting that they bought their first rental and are wondering when they should quit their job.

Jay Hinrichs · Answer

Clayton Morris podcast !!

Chris Seveney · Answer

It could also be $80k per year as thats around $200/door per month...