Latest / The Capitalizing Your Life Podcast / The Power of Partnerships: Bradley Seidel on Scaling Real Estate with the Right Team

Transcript

The Power of Partnerships: Bradley Seidel on Scaling Real Estate with the Right Team · The Capitalizing Your Life Podcast

• 00:00:00 Bradley It's the team, right? You're like, how does someone who has a military background, who's been, you know, flying for 11 years, then hops into a company like this? It's because of the team that I surrounded myself with. And that was a big part. You can't do this by yourself, and you can't even come close to the scale that we're doing right now by yourself. It it just can't be done. And I don't care who you are. You can't learn fast enough. There's too many risks that would be known to someone like yourself in the mobile Home Park, or you have to find your partners because what have you learned from doing this? Ohh my gosh, countless stuff. Let's learn from the others and not learn from your own mistakes. 00:00:34 Intro Welcome to The Millionaire Journey Podcast, the goal of this podcast is to guide and empower you on your journey towards financial independence. Here's your host, Glen Yaney. 00:00:44 Glenn Today, my guest is Bradley Seidel with Burton Capital Group Welcome Bradley. 00:00:48 Bradley Hey guys. Thanks for having me. 00:00:56 Glenn Yeah, I'm glad to have you on. You're in my mastermind group in Tampa and heard a little bit about your story when we met. But if you could just if you could tell us your back story. 00:00:59 Bradley Yeah, of course. You know, just real quick talking to that that mastermind group, it is so awesome being around like people like yourself. I couldn't recommend anyone that's listening then finding their local mastermind local real estate group and being active in it. And I'm so glad we got to meet each other. I'm Brad Sydell. I'm an old Naval Academy product was a Navy pilot. 00:01:19 Bradley For over a decade, I got to fly with some pretty amazing people, really high performers, and once I left in early 22. Joined this company, Burton Capital Group, with my Business School classmate of mine at University of Florida, and I wanted to find people that were still that impressive that were still that well-rounded and wanted to go out and make some money this time as opposed to saving lives and, you know, accomplishing the mission now it's handling larger assets. Different types of toys, as opposed to the aviation types of toys, but the the brick toys. If you would and making making a run at it in this way and it's. 00:01:55 Bradley Been. 00:01:55 Bradley A blast so far, yeah, we started. 00:01:57 Bradley We've got now 100. 00:01:58 Bradley And 31 million assets under manage. 00:02:00 Bradley Spent really focused on the student housing multifamily within the southeast. We found our niche and. 00:02:07 Bradley Really what we. 00:02:08 Bradley Did was we brought in a gentleman named Biff Ramsey who is my classmates. Good friend through college and he had operated over 25,000 unique beds in student housing. So student housing is. 00:02:21 Bradley All done in bed, so that's like $1.4 billion. He's dispossessed and his, like, 20 year career. Unbelievable. So when you have someone like that, it's really easy to niche down. And that's what we've done. We've, we've really niched down in the southeast. Just like while I was talking about the. 00:02:36 Bradley The relationships within like a local real estate, meet up all of our deals have been off market through relationships, mostly through BIFF. And so you know with him it became very clear this is gonna be our focus. This is where we're this is our niche within multifamily. 00:02:50 Glenn So what kind of assets are you looking at like when you first started? What was the first property you guys bought? 00:02:56 Glenn When you started. 00:02:58 Yep. 00:02:58 Bradley Yeah, good. Good question. You know, you would think that you would work your way up like single family duplex, like work your way up, yeah. 00:03:05 Bradley We went right. 00:03:06 Bradley For the jugular man, we we took out, it was 114 unit in Milledgeville, GA. So this is what we call a secondary market? Not quite tertiary, but it is Georgia College and state about 8000. 00:03:18 Bradley Students and Charles, my partner, he had actually lived there for a brief period and his father was from there, so. 00:03:26 Bradley He knew the area and Biff, who I'd mentioned before, he had worked with the developer but with his previous company. So all these relationships and kind of whirled together. We got a a whisper of an off market deal that was really just too good to give up. So yeah, we ended up taking down a that was a $13.8 million deal was our first deal. 00:03:48 Bradley That we took down. 00:03:49 Glenn Well. 00:03:50 Glenn So whenever I hear student housing as like a asset class, I think very institutional like I would say like the black rocks, these are the guys that are buying these kind of asset class is there student housing that's like. 00:04:04 Glenn Low grade like C Class or D class student housing? Or is it all just like institutional level? 00:04:11 Bradley That's a really good question because obviously, yes, there is the beautiful student housing right next to the campus all the way down to the, you know, the animal house, like single family home with kids are putting their heads through the walls, that kind of thing and everywhere in between there, right. 00:04:27 Bradley And the important part for anyone that's looking into student housing. And I really, truly implore you to, whether you're looking at the, you know, $300,000 house or a $13 million deal like like we did when we started. 00:04:39 Bradley I would take this we. 00:04:41 Bradley We ended up asking Biff this question right? He was in that world for 20 years and he worked for landmark, who's the largest operator and 3rd largest owner of student housing in the nation. And he told us that you need to tackle the Class A the closer to the campus cause dealing with the really B minus and below. He's like, you don't want to touch it. 00:05:02 Bradley With a six foot pole, don't touch it so. 00:05:04 Bradley So that was very eye opening and ioffer that up because you know a lot of people wanting to get into this right by the room. What is it? A pad split, right. Pad splits been really popular lately. So I get a lot of people asking me like, you know, think of the margins, right? We're renting everything out by the room. We have a 5 bedroom unit. We're getting 5 separate leases. That shakes out to about 30%. 00:05:25 Bradley More than if we rent it out per unit, so you know, very easy math. You could start seeing why this adds up, but the big **** is we only like a laser. Focus on. 00:05:37 Bradley Pedestrian to campus Class A. So within 10 years. And if we're not getting those, we aren't even going to look at it because of the quality of tenant, if you would, all everything that you think about is a downside to student. It does happen, but usually. 00:05:52 Bradley They're mimicking their their environments, right? We put them in these beautiful and I mean beautiful. 12 foot ceilings, quartz countertops, like stainless steel appliances and these kids. 00:06:03 Bradley Treat it like the beautiful new like place that it is and we have very, very little damage. And even if we do, it's actually a nice little line item on our P&L's where we make a good amount of money cause the parents are the ones that guarantee these leases. They all have 800 plus credit scores and we go, hey, mom, dad, you we got a bill for, you know, 2. 00:06:22 Bradley 150 bucks here. 00:06:24 Bradley And you know most of our most of our properties going have 0 delinquency like think about that. So everyone pays on time every month it whether it be for you know just the rent or whether it be hey there is like a damage which does happen every once in a while. Everyone's always on time. 00:06:40 Bradley I mean, even the ones that aren't 0, they're darn close. I can't necessarily speak to the Class C the run down shacks that are out there that are doing student, but there is a area that's worthwhile and student and that's that class, A close to the pedestrian campus. 00:06:54 Glenn Yeah. So I'll tell you, comparing my story to that is that we've bought some RV parks where majority of the RV's on site are owned by the park, which you would think there's a lot of revenue that's going to be showing up compared to like a lot rent like a lot rent would be like 500 bucks a month. 00:07:12 Glenn And we'll be able to get seven 5800 with an RV on site. So that being said is the type of person that rents an RV and that doesn't own an RV that turns into a rougher resident is what I would. 00:07:25 Glenn Say and yeah. 00:07:27 Glenn A lot harder to find. And when you're talking about like only buying a class or close to that. 00:07:33 Glenn It's like. 00:07:34 Glenn When you get to shared housing, it turns into almost like a I would imagine. Just guess is like a flop house almost like a it could be maybe like a halfway house, but I would say that would be a whole different business insurance wise. 00:07:50 Glenn But that's kind of what I was thinking is a comparison is like recently about an RV park. 00:07:56 Glenn And the rents are 750 for RV pads and we put it on the Internet and they lease out as quickly as we put. 00:08:03 Glenn Them on the. 00:08:04 Glenn Market and I wouldn't say that is in a class park, but I would say as you get to the A class level, the demand starts to increase and quality of problems are also better. You know like we're talking about. 00:08:17 Glenn Frequency which right now? 00:08:20 Glenn With what we're dealing with, hurricane wise is we have some pretty high delinquency going on right now with these. You know people don't work for two weeks, it's hard to pay rent so. 00:08:31 Bradley That's right. That's and that's normal. I bring that up for those who aren't aware how crazy that is to have zero delinquency, I don't care what facet of real estate you're in. It's crazy. 00:08:40 Bradley See. Yeah. And that's why I wanted to bring that up because it's just, we're proud of it and we wanted to, you know, share. 00:08:46 Bradley That out. 00:08:47 Glenn So you found, I guess an experienced operator and what what would be your position in the business? 00:08:53 Bradley I am the chief investment officer, so a lot of the fundraising and the equity grabbing of of of sorts kind of goes my way. But I also tackle a good piece of the debt and our success through the twenty 20s. 00:09:07 Bradley So far has been loan assumptions. 00:09:10 Bradley So I'll work with Fannie Mae or Freddie Mac and make sure that that loan assumption goes through smoothly. Really, it's more, it seems more daunting than it actually is. They they give you a huge checklist and you're just like running down the checklist and you need to make sure everything's every I is dotted and T's crossed. But after that you're you're good to go. But the assumptions really saved us through 2022-2023. 00:09:32 Bradley Early 24 here because you know, we're picking up rates at mid threes low fours and meanwhile everyone else is going belly up with an adjustable rate that's really hurting them. And actually those are the people that were helping in a way as we purchase their their properties before they go for. 00:09:48 Bradley Closure. But yeah, that's been a big aspect as well. So you're absolutely right. It's the team, right? You're like, how does someone who has a military background, who's been, you know, flying for 11 years, then hops into a company like this? It's because of the team that I surrounded myself with. 00:10:03 Bradley And that was a big part. You can't do this by yourself, and you can't even come close to the scale that we're doing right now by yourself. It just. 00:10:12 Bradley Can't be done. 00:10:13 Bradley And I don't care who you are. You can't learn fast enough. There's too many. Put this way. Too many risks that would be known to someone like yourself in the mobile Home Park. You have to find your partners, because what have you learned from doing this? Oh, my gosh, countless stuff. Let's learn from the others and not learn from your own mistakes. Right. That's that's the big piece. So yeah, I found a. 00:10:32 Bradley Really amazing team. We've grown out now to nine members and you know each person is strategically picked to which is I think, something that I didn't think of it first. You know, I wanna build a company with my friends, right. People who who know me well and who I get along with. Well and it's interesting. 00:10:50 Bradley To that. 00:10:51 Bradley Not saying I wouldn't be friends with people, but these people pick for strategic reasons and I think that's also a reason for our success. We really are kind of foils. We do get along well together, but it's not who you would anticipate us being like. Great friends. You would look at us to be like oh, you guys are like obviously like buds or something because we went very strategic. Hey, you have this function, you have this. 00:11:11 Bradley You know asset that we bring to the table and we need that. 00:11:15 Bradley And you're now like, part of the team, and it's it typically carries a, you know, a number of guys going to typically carry that kind of numbers guy vibe and the, you know, me on the equity raising side is going to bring a more talkative vibe, right, that kind of thing. But those are the things I can't emphasize enough to anyone that's looking to start is it's just a risk mitigator, right. Finding the people around you. 00:11:36 Bradley Take a little cut. Right. You're not getting the whole pie. 00:11:38 Bradley But who cares? 00:11:39 Bradley You're gonna bigger pie, and you're gonna get a piece of the pie. As opposed to I don't know how many flippers I've talked to where they want to. 00:11:46 Bradley There and they take on the risk because they know that they'll get the whole pie if it goes well, guess what, they get no pie. 00:11:52 Bradley They get negative pie. 00:11:54 Bradley They owe money still, and they would have learned some things if they teamed up with the. 00:11:57 Bradley Right people. So yeah, exactly. 00:12:00 Bradley Yeah, that's been a big part of our successes, the right team, the right part of the team and man, I could go on about partnering with the wrong people. 00:12:06 Bradley New Glenn, which I did, which one of the initial partners we had was not a right fit for us and man did that really set us back. But now that we've worked through that and we've kind of pruned our team to the right people, it's just a pretty linear upslope at the moment. 00:12:23 Glenn Yeah. So let's talk about, I know we kind of talked about it, but so you went from military. 00:12:30 Glenn To working with this, you know these big operators and what would you say the thing was that how did they come across you? And they're like, this is the guy that's gonna help us raise money. Like, how did that even happen? 00:12:41 Bradley Yeah. Good question. It came through. 00:12:44 Bradley Putting yourself out there, right? Luckily for me, I am more extroverted, but you truly don't have to be. It's just harder to do as an introvert to place yourself in a call, a social setting, right in the very beginning of this we mentioned, hey, get out there to the the local real estate, meet up. That's essentially what I did in Gainesville. I was part of the the real estate meet up of the area and. 00:13:04 Bradley You know, you start talking to people and you and that that's all it is. And I wasn't. I didn't know what I was talking about. I wasn't there to really get anything from. 00:13:11 Bradley But that's where you're gonna meet people that are making moves. It's not hard to identify them. Honestly. You can probably think about the last time you went to like a conference or a meet up and you like, I could tell that guy is or that woman is doing things, and I want to be with them. Yeah. Like I I don't know what they are yet. I want to learn more. And that's how that's how it started for me. I did have. 00:13:31 Bradley What they perceived as. 00:13:34 Bradley The ability to raise capital because of the, I guess, perceived trustworthiness of a naval aviator. So they thought that I could raise funds well for them and go into, you know, my network and say, hey, I've gone through this and I I believe in this and we use our our risk mitigation brain that has been exercised to the team to make sure this is going to be. 00:13:39 Glenn Mm-hmm. 00:13:54 Bradley An investment that you're going to get into and then people trust that and so they recognize that in me. That's what I offered actually, because I think you need to have something. You offer stuff to go in and be like, hey, I wanna work with you, but I don't know what I can provide for. 00:14:07 Bradley You know, so that's how it started with the hey, this is what I what I can offer. I think I can raise funds for you. Have I done it in the past? No. And I told them that like, don't put the whole team on my back cause I'm on tried. Yeah. But I believe I can. I can scale to that with the right team. 00:14:23 Glenn So what would you say the transition was from like because there had to be a certain for my experience I had. I had a good feeling it was going to work, but I had this transition where I had to risk something. So for me it was. I had a good paying job making $150,000 a year and I was somewhat helping with the syndicator. 00:14:43 Glenn The business partner Garrett and what I ended up doing is leaving that $150,000 a year job for about $1500 a month type income. So obviously we're seeking equity and and stuff like that. But what was the risk or where was the area that you were that you had to really put up? 00:15:01 Bradley It was again since I had highlighted, hey, I'm gonna be your Kappa Razer, this is what you we I noticed. And this was just because Charles had been in the capital markets world. My partner has been in the capital markets world for 20. 00:15:06 Mm-hmm. 00:15:14 Bradley Years and was getting his MBA at 40, which I bought him for, and he had the experience in that he knew how to underwrite. He had these amazing models. He was showing me these proprietary models that he had pulled from all these different companies. He had worked with the parts that he liked. He he said into his own. He's very proud of it. And then, you know, we mentioned Biff who came with this immense amount of asset management. 00:15:35 Bradley Experience and within the student housing world. And I knew that this is what the. 00:15:38 Bradley Needed and to your question, Glenn, the risk was and is still when you go to raise money. 00:15:45 Bradley You know your reputation is out there, right? Like I have millions of my friends and families and people I really care about. Their money is in my deal. And I'm telling right now, I I care so much more about them being successful than mine. They know that. But it also means capital S stress like it is the hard part. 00:16:06 Bradley About CAP raising is if you are the kind of person that people want to give money. 00:16:11 Bradley To typically is because they know that you're going to take care of them, and with that, you know, stewardship. If you would comes a lot of heaviness on your shoulders, so that's what I've given up. I would say it definitely wears on you at times when things go awry. That's why you need to have the right team and thank God I do, because things always do go awry. 00:16:31 Bradley And problems always come up, but my team knows how to how to handle that and it it really does relieve a lot of the stress that I feel because my I know my team knows how to handle things, even if I don't know how to handle it. That's OK. And again, that's why having the right team, it just can't. 00:16:47 Bradley Can't preach it. 00:16:48 Bradley And putting yourself on a limb, going back one more time, once you mess up your reputation in this world, you know, I know, like, I know, Glenn people just going to, you know, conferences, whatnot. We had talked about that before getting on here. It's one of those things where everyone's always. It's a small world. 00:17:03 Yeah. 00:17:03 Bradley So we're gonna know you and. Ohh yeah. No, I remember you. I know someone who knew that you took their money and you lost it. Yeah. And you won't get over that. And so that is, you know, you could spend it right and and raise for these things. But I implore you, if you feel you're getting over your skis a little bit with raising, just make sure that you feel the utmost confidence in your deal and the utmost confidence in your team. 00:17:25 Bradley To handle the things that can go wrong because. 00:17:27 Bradley You're going to wish you did, whether you did it or not. 00:17:30 Glenn Definitely. We're in the process of closing on a deal this week and that's kind of where the stress is right now. Just trying to for one, make sure the variables are in your favor, right? You know, it's like you're underwriting is conservative and hopefully you can make those numbers better than what you underwrote is really what it comes down to. 00:17:51 Glenn Hey guys. If you want to learn more about our deals we're investing in go to our website and sign up for our free ebook, 10 reasons mobile home parks outperform other real estate investments. We won't spam you. We'll just keep you updated on the podcast and the. 00:18:04 Glenn Deals will work. 00:18:05 Glenn Going on now, back to the show, so I know you did mention before the podcast about I guess a side business with a Du's. 00:18:15 Bradley Yeah, that's right. So I have a company called Tiny Home Geniuses and this company. 00:18:21 Bradley Was really foreign because that's how I started in real estate. You know, my wife and I, we were house hacking down in Key West. 00:18:28 Bradley And it was really hard to get my wife to understand why we're buying, like, essentially a duplex, why we're putting all this funds into this until, you know, we get the second side taken care of and rented out and the first paycheck came in first rent check and then she goes, oh, I see it now. And so we rode that. 00:18:48 Bradley For quite some time and it it really was the snowball that the catalyst that. 00:18:53 Bradley Got not just me, but the buy in that I also require to do what I want to do within my family unit. If you would. And so we did it again in Key West, we've and the whole point is to help people that are starting on their real estate journey to have what I call utilizing this new legislation, right, accessory dwelling units. 00:19:13 Bradley Are up like over 1000% over the last 18 months because the new legislation is hitting all across the country. 00:19:20 Bradley This and So what this does now is it allows you to take a single family home that was not cash flowing. You purchase it and through a lot of different financing that's available now either two or three K alone, which is an FHA loan, you know, construction loans, you name it, he locks. Some people want to just pull their funds and build it that way. But along so you show it, you're building a. 00:19:40 Bradley Duplex what I call Rich Man's duplex, which is a brand new Adu, OK? And the ADA is an accessory dwelling unit. It usually has a limitation of maybe 950 to 800. 00:19:50 Bradley Feet. But the point is, is that you're able to live in one, rent out the other, and if you're not living for free or getting paid, you are only paying a few 100 bucks a month and you're able to roll those savings into other things. Not to mention why I like it. Glenn is because you're new to this. Like, I've never been a landlord before I started this. I need a new product. I can't be dealing with maintenance. 00:19:59 Yep. 00:20:11 Bradley Of an HVAC going bad and all these things. But with these ADO's that are freshly built, theoretically maintenance. 00:20:17 Bradley Zero, right, at least for the first few years. And that's an important piece too, because you got some new landlords. That and I don't blame you. I don't know or want to be dealing with this, that. 00:20:27 Bradley Much so between those. 00:20:29 Bradley 2 push together the legislation that's out there that's really encouraging these to be built. In fact, here I'm in the Tampa area and in Saint Petersburg they do offer a 40%. 00:20:38 Bradley Grant. 00:20:39 Bradley If you're building within Saint Peter, and Grant is in not alone, but free money. If you are building an Edu in Saint Petersburg, they will pay for 40% of your Edu well, and that's just an example of what legislation is out there and why this is an area that I wanted to be a part of, not just to help, but because it just seems like we're on the right momentum, right? It's not just me wanting to make a change. 00:21:01 Bradley Governments across the country want to make a change in this direction and I want to be part of. 00:21:05 Glenn Definitely. So few questions. As I was listening, first one is with the financing say you're not able to get a grant, we'll just say there's no grant available or maybe there is. So what kind of loan and equity would you have to have in your house to add an AD U? 00:21:25 Bradley Good question. That's a question we get a lot. You know, most of the people that we've worked with so far, we're looking for a primary residence, right? This is house hacking. So that's something that needs to be brought in because a lot of the financial tools that are available to you are there for primary residences only. 00:21:41 Bradley So assuming that that's the case, what you're looking for is that 203 K loan that I talked about is an FHA derived loan and basically what A2 or 3K loan is is only 3 1/2 percent down. Like any FHA loan but big, but they give you and they're able to roll in whatever price you can qualify for into a. 00:22:01 Bradley Remodel or a rebuild. 00:22:03 Bradley And so say I've got a home here in Tampa for 350 and it's on a big lot. I got my list. I want a corner lot and I say corner because I want a separate entrance for my primary residence and a separate entrance or my Edu. I don't want to be interacting with my tenants as much as I, you know, everyone wants their privacy. That's the beauty of having your own 4 walls. You know, we don't want to be. 00:22:13 Glenn Hmm. 00:22:24 Bradley Sitting in an apartment complex, hearing each other on the wall, these are detached AD's. 00:22:28 Bradley That I'm talking. 00:22:29 Bradley About. So yeah. So we'll go in, we'll take this two or three K loan, you buy it for 3:50, and then you get it and. 00:22:36 Bradley Add it on. 00:22:37 Bradley 150K. Call it for which is. What about it? It takes to build. 00:22:42 Bradley You know, you're fairly basic 221 and a half is what I like to build out. Typically, I recommend most people want 2 beds for either hosting having parents over if they have kids, you name it, so 2 and then 1 1/2 has been very popular go to. But what is about 150 K for the 203 K loan that gets rolled in and you do not pay? This is actually brand new within. 00:23:02 Bradley Last week for the 203 K loan, you don't pay for the the interest on that or the payment for 12 months. Wow. So you're rolling for free. 00:23:11 Bradley For 12 months. I know you're wrong. It's going to take six months, 8 months to finish the build and all that. But the fact that they are again going back to legislation, right, think about this like they are saying we will give you, we buy the house but then also 150K maybe 200 if you can qualify for that amount because say hey maybe you want to redo the kitchen in the main home. 00:23:31 Bradley Right. But anyways, then you build the Edu for call it one 5200. What I mean maybe 100 maybe you wanna do a little 11, you know obviously you're in control that and you're not paying on it for 12 months. I'm a huge fan of the two or three K loan for that reason again the the limitation being this is your primary residence. 00:23:48 Bradley But man, it's it's just like I said, legislation that's federally brought down, right. It's just being incentivized. There's no way around it. 00:23:57 Glenn So with the two or three K loan, how do they disperse funds? 00:24:01 Bradley So there is a a good question because for those who aren't familiar, typically when you're building anything, what they're called, their draws, right. So say, hey, there's going to. 00:24:10 Bradley Be a draw. 00:24:11 Bradley For the foundation, there's going to be a draw for the framing, and the draw means is like, OK, we're going to pay for this phase of the build and then the bank gives you that money. 00:24:21 Bradley But only. 00:24:21 Bradley That money. And so really what it comes down to is before you purchase this, you go through an FHA representative, call it and we're going to put together the scope of work and they have to be approved by the FHA and they have to have all this, you know, approval so that they're like, you know, we give you the thumbs up, that you are good to do this. But yeah, you're going to piece together your plan with them. 00:24:42 Bradley And that's going to be submitted with the loan. So it's going to be drawn out with all laid out, the plans laid out well before the the loan ever closes. 00:24:51 Glenn Awesome. So with you, I guess it's a business that you're running. So like exactly how would you go about assisting somebody to help them through the process? 00:25:01 Bradley Yeah, I mean, you know, for this, as you mentioned, Burton, Capital Group, student housing, that's my main goal. So I was talking to Jared before from our our group, I look at things at a 10 to 20 year lifespan. 00:25:13 Bradley And I'm not making a ton of money on this right now I'm consulting. Mostly I'm not even charging for that. If people want you to use me and my builder, who I've used, I've done it here in my own home. You know, they're welcome to it. But the idea being is I want to help people get started in the real estate world. I know how powerful this is to start *********** month after month, not paying or paying very little. 00:25:35 Bradley Or getting paid. You know if this works. 00:25:36 Bradley Really well, with the hopes being that, yes, maybe they want to use me to build, maybe they don't. They just want to hear some advice. But then eventually when they start making good money and they don't want to do a tenant say more that they invest with Britain Capital Group and you know, still receive the same depreciation, still receive actually much better returns than you would with single family homes. And so that's my. 00:25:49 Yeah. 00:25:57 Bradley That's my long game. I wanna build the trust. I wanna. I wanna show the value of. 00:26:00 Bradley Front massive value up front and then in five to 1015 years. I'm hoping to get calls and it's really cool when it does start to happen too when you you already getting like you know what? Hey Brad, I don't want to do this myself. I want your your guys to do this and and so it's it already is happening but letting people make their own decision, not pushing them to like use me. 00:26:22 Bradley And again, that's that big picture scope that's required when if you're going to do things successfully, if you have the short term like I need to make money up front, I think people can smell it out. Man, I really do. I think they smell it on. 00:26:34 Bradley Yeah, I've been pitched by those people too, and I don't like the feeling I have when I'm like you need. 00:26:39 Bradley To use me. 00:26:39 Bradley And I'm going to be the best one for you. You gotta use me right now. I just. I scratch my neck and I'm like, I don't like. I just feel uncomfortable. So I'm. 00:26:46 Bradley Not making a ton of. 00:26:47 Bradley Money on it right now, Glenn, I gotta be. 00:26:48 Bradley Honest with you, a lot of consulting, a lot of time with the idea being that you know in in a few years from now when people get started. 00:26:50 Glenn Yeah, yeah. 00:26:56 Bradley They'll come back and they'll they'll remember the value that they got. 00:26:59 Glenn Kind of like this podcast. 00:27:01 It's right. 00:27:02 Glenn There's zero money negative. We're in the negative right now, right? But one thing I would add to what you were saying. 00:27:11 Glenn It was. It took me like 5 years to buy a rental property like I wanted to buy one. I read a bunch of books I might have bought property, but I didn't really make any money like I I bought a rental property and my parents moved in and then I was like, I can't make money on my parents. So then I made no money. So anyways, Long story short, after I actually received started receiving about $1000 a month for my first rental. 00:27:33 Glenn It took me like two or three years to become financially independent after that, and that's kind of like what the snowball that you're talking about is, you know that it's a, we'll say, probably 15 to 1800 a month payment towards your mortgage. 00:27:46 Glenn And you're able to really set the ball rolling and I think it it's great. And actually as you're talking, I currently rent my house and I'm kind of looking into mortgages, you know, probably about a year or two away from looking and I'm in an area where you would totally add AD U and add a lot of value to the property. And I was thinking, man, that would actually be the play. 00:28:06 Glenn You know, just finding a A house that that it would work with and then just work that model out and then you could live in a nicer area because you're able to. 00:28:15 Glenn Offset the monthly payment to that resident as well, so that that would it's a great play in my opinion. 00:28:21 Bradley It is. It's helping so many people think about this as a as a good landlord and you know, I don't know where this whole like, negative landlord mantra comes from. But your tent is going to be very, very, very happy with a brand new home. I'm telling you from experience that they are going to be great tenants because there's nothing to complain about. Yes, their home is gorgeous. It is brand new. 00:28:41 Bradley They're wrong. There's. 00:28:42 Bradley Always there always are things. But what you're dealing with are so minute compared to the 1950s product that's out there or whatever, it's 8000 years old, it's just. 00:28:52 Bradley Paint day. And so yeah, you're right. It is helping yourself. Your bottom line, your pocketbook. And it's also you're being the landlord that you should want to be. 00:29:00 Glenn And also you're you're moving into, say, in the Adu area, I would imagine it's mainly for it seems like the nicer parts of town. So you're able to move into these areas, but because you obviously are doing all this work to move into this area. 00:29:14 Glenn You're actually going to find a tenant that's just as motivated to move into the area, and it might even be affordable compared to, you know, renting a full house that's gonna be, say, 35104 thousand least a month. Man, you're getting somebody for 1800 on, you know, and you're able to benefit from it from the 1800. They're happy. They get a brand new house, you got the. 00:29:34 Glenn Class A building, you know that you're talking about buying for the student housing, but this is also, you know, family housing that you're getting for the good school zones that you'd like to be in. And all the things that. 00:29:44 Glenn With it. 00:29:45 Bradley That's right. And and think about. 00:29:46 Bradley It. 00:29:47 Bradley You know the old back of the bar napkin math of the 1% rule. Yeah. You kind of nail on the head there. Right? 1500 or sorry, 150,000 to build this thing. Just this just our example really in these nicer neighborhoods where these are at cause. This is where you're living, right? This is your primary residence. So it's where you wanna live? I'm gonna. 00:30:03 Bradley Assume it's a nicer neighborhood like you mentioned the nice schools. 00:30:05 Bradley You're going to get high. 00:30:06 Bradley 18th, you know, 1819 maybe, maybe 2000 per month. OK, it is wildly affordable for them. They are so happy to be in this area with a new home in a nice area for affordable amount. But also remember that 1% rule and you are cash flowing on this again so much more. So that it's going to offset the lack of cash flow from your primary residence. 00:30:27 Bradley Right. And so again, maybe you're not living for free, but it's going to be darn close because of how much money you're making on the Edu, it's going to offset the lack of cash flow from the single family home. 00:30:36 Glenn And then it turns into a whole nother. I mean, we could go. I could go on forever about this. I'm thinking about, like, saving money actually makes it to where you don't have to show as much earned income as well. And then you'll have. Maybe I'm assuming you have talk to an accountant, but you'd be able to have, like, the tax deduction from the actual rental unit, the $150,000. 00:30:54 Glenn Depreciation, maybe you get a Cossack done to it. If it works, the. 00:30:58 Bradley Numbers definitely get it Cossack done. 00:31:00 Glenn Definitely, yeah, cost seg. So you're literally driving all your expenses down and it's really accelerating the process. I 100% you sold me. I'm ready to do it, but let me go find a house. 00:31:10 Bradley Hello. 00:31:12 Bradley You know they the acronym for Real Estate. 00:31:14 Bradley Is and and stop me if you if you're. 00:31:16 Bradley For this one, but is the ideal if you're familiar with this. I think it's Chad from bigger pockets. You wrote a book that was set for life. I'm sorry. Real estate for life and ideal is income, which is the standard amount that we're getting. The D, which is why I say definitely get a cost segregation study if you're not familiar with it. It helps the depreciation, which is another. 00:31:37 Bradley Pillar of this real estate world, and this is allowing you to keep more of the money that you've made if you're not as familiar with it. It's a wildly powerful tool, so it makes the income that you've made. You get to keep more of it with the depreciation IDE, which is equity. So this renter is paying down your bill every month, and whatever is left is your money. 00:31:56 Bradley Equity IDE a A would be appreciation which let's just go very normal. I know it's been crazy in the past but call it two 2 1/2 percent. Hey, it's just making money without doing anything. You know nothing crazy. Never bank on it. But you can anticipate a really modest amount and then L for leverage as I mentioned for this loan, you're talking 3 1/2 percent down. 00:32:17 Bradley And there is nothing on this planet that you can get that much money for 3 1/2 percent down. There is nothing. And if there is, please let me know because I wanna use it. So that's the the ideal I I think about that a lot. 00:32:29 Bradley Cause it's it really does breakdown. Why I love real estate and why I'm in this and why this is where I put all my energy into. So again, let me know if there's something else that's a better. 00:32:38 Glenn Lever than real estate? Definitely. I'm excited. I wanna do a an Adu. Love it. So where can people find you? 00:32:46 Bradley I'm on online with burtoncapitalgroup.com and or on LinkedIn as well, so reach out on LinkedIn Bradley Seidel again. I'm I'm the one that's here in Tampa with the Burton Capital Group and or tiny Home Geniuses, which is, you know, check our website there. 00:33:00 Bradley As well, and feel free to reach out. You know, a lot of the DU world is legislation based as I mentioned. So it's very particular to a region that you're in. I'll help as much as I can and potentially I'll just have to say, hey, this is where you have to go to look it up yourself because I might not know what it's like in Mississippi or in Nevada. But yeah, please reach out. I love helping and. 00:33:21 Bradley Brian, I appreciate you having me on today, buddy. 00:33:22 Glenn Thanks for being on the show. 00:33:24 Outro Thank you for listening to the Millionaire Journey podcast. Please rate, like, subscribe, leave a comment and share with somebody you think would enjoy listening.