Today, Jason Hartman comes to us from Meet the Masters. He thanks one attendee who has traveled over 20 hours from Australia. Jason talks about the success of the Meet the Masters then plays a few clips from some home inspectors, George Gilder, Drew Baker, and many more.
Investor 0:00
My wife and I were drawn to you because we liked the idea of putting money down qualifying, making sure we can cover the mortgage, you know, and have reserves like you were talking a language that was very appealing, based on what we had gone through before.
Announcer 0:16
Welcome to the creating wealth show with Jason Hartman. You’re about to learn a new slant on investing some exciting techniques and fresh new approaches to the world’s most historically proven asset class that will enable you to create more wealth and freedom than you ever thought possible. Jason is a genuine self made multi millionaire who’s actually been there and done it. He’s a successful investor, lender, developer and entrepreneur who’s owned properties in 11 states had hundreds of tenants and been involved in thousands of real estate transactions. This program will help you follow in Jason’s footsteps on the road to your financial independence day. You really can do it on now. Here’s your host Jason Hartman with the complete solution for real estate investors.
Jason Hartman 1:06
Welcome to Episode 1158 1158. This is your host, Jason Hartman, thank you so much for joining me today. You may hear just a little bit of background noise for in this very short intro, because I am still in Newport Beach, where we just finished our meet the Masters two day conference, and then a one day venture Alliance mastermind where we invited the elite ticket holders as a guest. And we just wrap that up. And I am looking at this absolutely gorgeous view from our hotel room here at the venue where we held both events are overlooking a beautiful golf course the Newport Beach Country Club, I believe that’s what it’s called. Yeah, I think so. And then the Newport harbor and then the ocean beyond that in this view, boy, I’ve seen some pretty good views in my life but I don’t think You can beat this one. It’s absolutely gorgeous. And it was such an exciting weekend. It really was. And just wrapping it up with the venture Alliance day was just the perfect icing on the cake we masterminded this morning. And we had one of our members just had a great presentation on the for investment quadrants. That was a really nice overview of how investors can invest in different things. And just kind of another way they can diversify and eliminate risk when investing and in various pooled money assets. Well, you can never eliminate risk, I should say reduce risk or mitigate risk. That’s the more proper word. And that was great. And then we went to a beautiful lunch at a super swanky restaurant. Everybody just loved it. There were, I think 15 of us here for the venture Alliance day again, that’s all was a small group, mastermind group format, and then we had almost 200 people This weekend for the entire weekend and everybody just loved it. And you know, at the end of meet the Masters, it always happens this way. On Sunday afternoon, people are outside of the room, visiting our exhibitors and a trade show area and doing deals and buying properties and talking with financing providers and self directed IRA providers and the different banking people that are out there and just all our different service providers, our home inspector that we had here did a phenomenal presentation. One of our clients drew who you’ve heard on the podcast did a great presentation about self management. And it got a little spicy, I must say there were some fireworks during that presentation, which were interesting and and you know, that’s what we want. We want to encourage this we want to encourage different viewpoints and, and really, you know, see things from every angle because my view is when you have that common of openness and transparency, you really get the best answer for any problem. And so that was great. And we also really want to reach out and say, thank you so much to our livestream audience. We had a 97 viewers on there at one point. And of course, the livestream audience does get a replay for a while. 57% of those viewers were on a mobile device 36% on a desktop and get this 4.9% on a connected TV, they were watching the live stream right on a TV set. But interestingly, only point 7% of you watched on a tablet device. So that was interesting. But was even more interesting than that is when looking at the livestream audience looking at where in the world they were from. Wow, that was really interesting. We had viewers on the live stream we had a live visitor actually What a treat for him to fly out 22 hours to fly from Australia, from Perth, Australia to come to meet the masters and you know over the years we’ve had people come from all over the world to our different events, but that was
Jason Hartman 5:16
I just want to say super special appreciation for coming that far to attend meet the masters at 22 hour flight that’s really phenomenal. So we very much appreciate your faith in us and, and coming out so far for something like that. But just give you some information about where in the world, all of our livestream viewers. We had people in El Salvador, Iraq, Philippines, Nigeria, and now last year at meet the masters. We had a gentleman fly from Nigeria and he attended in person. Of course, we had people in the UK Romania 82% of the livestream audience was in the US. 2.8% was in Australia. Another 2.8% in Indonesia 2.1% in Argentina, we had people in Portugal, South Africa, Brazil, Canada, the Czech Republic, Chile. Wow, what an honor. Thank you so much for buying the livestream ticket and tuning in and watching us from around the world and we really appreciate that. So that was just phenomenal, but an absolutely great weekend and we are going to play some highlights for you from the weekend. And you know, I’ve been working pretty hard for this event. My team has been working very hard so big thank you to all of them. You know, my girlfriend and I are going to go out and just kind of enjoy Newport Beach so she doesn’t know where I’m taking her. But I’m going to take her over to Balboa Island and we’re going to walk around there maybe take the Balboa Island Ferry and maybe go down to Laguna Beach and, and just chill out a little bit. So that’s what I need to do here for a few hours. Here are some highlights from meet the Masters in this, again, I want to say is content, you’re going to hear some content here. This is not just a commercial of us patting ourselves on the back about the event. So here’s some free content for you as a little sampler of what we did this weekend at meet the masters. And then also I do want to say though, that we did announce a few upcoming events at meet the Masters we announced to cruise ship events. One is our Cuba and Grand Cayman event. That is a cruise a week long cruise. Departing from Fort Lauderdale, Florida on November 6, that’ll be several months away November 6, Cuba and Grand Cayman Cayman Islands. Then we also announced meet the masters at sea, a Mexican Riviera cruise next March and you can go to Jason Hartman dot com slash cruise, Jason hartman.com slash cruise to check out our cruise events. You know if we don’t get enough registration for meet the masters at sea, then we’ll just do it on land again and we’ll be a bunch of landlubbers like we’ve always been and have our 22nd anniversary meet the masters. But I’d love to do it at sea. So if we get enough signups for that here, we will go ahead and finalize that. So that would be a lot of fun to do that at sea. And then we also announced an event coming up sooner than that. And that is a venture Alliance retreat, a weekend retreat in Savannah, Georgia. And here is the focus of that. One of my very good friends is has been teaching me lately she has been doing a great job teaching me all about tax liens and tax deeds and investing in them. And that will be the focus of our upcoming venture Alliance weekend in Savannah, Georgia. And of course, if you are not a member of the venture Alliance, you can buy a guest ticket for that event. If you’d really like to learn about that, and then just mastermind with us for the weekend, that will be in May, you can go to venture Alliance mastermind.com to see more information about that, or Jason Hartman calm for the other events and of course, Jason hartman.com slash cruise for a direct link to the cruise events, but we’ll get that up on the front page. So you can find those all easily just from the main page. That’s it for me now, but hey, let’s hear some highlights from the weekend. Here we go.
Jason Hartman 9:38
I rented this gorgeous brand new penthouse. one block from ASU in Arizona and Tempe Arizona, and I paid only 30 $600 a month for this gorgeous new 3600 square foot house $1 a square foot. It was it was a pretty amazing deal when I thought I must have died and gone to heaven. This is such a better deal than my 1800 square foot house here locally for 11 grand a month. And that’s when I thought, you know, renting a high end house is a very good deal. And why is that? Well, most of you know that follow my work is that it’s the rent to value ratio, the RV ratio. And and that’s really the best, very simple rule of thumb, see the thumb for investing, right? The rent to value ratio. And so that place in Arizona that I rented, and I lived there for about four years, five years, four years, maybe, you know, my rent to value ratio, there was like point three was probably worth about 1,000,005. And, you know, but you can always rent a high end home for a very good deal, because the rent to value ratio is in favor of the tenant. And you want to own a lot of less expensive bread and butter places that you rent to other people because the rent to value ratio is very in favor of landlord. So essentially You know the word I use a lot right? The word is arbitrage okay? an arbitrage my dumb down simple definition of the word arbitrage is exploiting the differences and things, exploiting the differences and things that’s what arbitrage is to me. I mean, you can look on Wikipedia or the more complex definition.
Inspector 11:24
Alright, let’s talk about investor inspection. So, does everybody get inspections when you buy? Everybody does. Alright, that’s a super smart idea if you’re not getting the inspection, that’s what I really want to talk to you guys about today is that the inspection is super important because you go into that house and you you have some things that you’re looking for maybe you have some great experience and and you know what you’re looking for cosmetically, you know, what you want to do, you might want to knock down this wall, maybe even you bring your contractor and like, like my old investor, Robert brought me to the jobs and I would maybe poke my head in the attic, or I would poke my head underneath the sub area and just a quick look, and I’m Look at the roof from down the ground and give them my opinion as a contractor. That’s what I’m doing. I’m thinking about how am I going to fix this? What are we going to do next on the project for remodeling but what you want really someone to give you an unbiased opinion, you want someone to dig in a little bit deeper, someone who doesn’t have any skin in the game, you’re paying them a small fee, maybe 300 $400 to spend three hours at that house, photograph everything and report the defects to you. So that’s what the purpose of the home inspector is for he’s he’s here to help you mitigate risk, not eliminate risk but reduce it. So no home inspector is perfect. We’re going to go places your contractors not going to go every one of my home inspectors if they can’t crawl completely under the sub area completely through the attic, they’re going to let you know they’re gonna take all the photos they’re gonna bring them out they’ll send that crawl bought underneath there if they need to. But your contractors not looking that way. He’ll poke his editor go Hey, you have galvanized plumbing, that’s cool. We’ll fix that later. But he didn’t see the seven foundation cracks that may affect your home down the road. So and we also know what that is, I know you guys are all buy and hold investors, but sometime you may have, you may end up selling. So we also know what the next inspector is going to look for. So if you happen to be in that particular deal where you may buy it and hold on to it for a little bit and you’re going to sell it, well again, having a home inspector opinion to look at it, it’s going to give you some sort of idea what the next guys gonna look for.
George Gilder 13:25
My view is that wealth is essentially knowledge. And knowledge is the growth of information. And na na na pledge reflects the creativity of people like you out there making major commitments in the in the economy. And you may think you’re in real estate and real estate should convey real physical things, physics and chemistry. But that is not the business you’re in. You’re really in a knowledge business. Real estate of the earth hasn’t changed since the Stone Age. What What is aged is the knowledge about it.
Mani 14:25
So here’s my definition of a self directed retirement account. It’s an IRS approved vehicle that allows you and I to get complete control over the money in our account, invest in anything that we choose, so long as it’s allowed by the government and make money tax protected. So our money grows exponentially faster and larger. And in many cases, spend every dollar we make 100% tax free. Okay? So it’s a vehicle that allows us to build wealth, make money and eliminate taxes. That’s what a Self Directed retirement account is okay, in a nutshell. So the one challenge that sometimes we run into though when we start to go down this path is that you’re going to hear things. And there’s a lot of misinformation on this subject. But one of the things that I hear people say once in a while is that you can’t do that inside of an IRA. Right? You’re not allowed to buy real estate inside of a retirement account. If you guys ever heard that before. Anybody ever hear that? You’ve heard it one person. Okay. So who do you typically hear that from? tax advisors, friends, neighbors, right? People like that is who you’ll hear this from. But let me ask you something. Do tax advisors make the rules when it comes to retirement accounts? No, no, who makes the rules? All right, very good. The IRS. So if we want to know what we can and cannot do, we have to go to the source, right? We have to go to the people who enforce the rules. And so this is off the IRS website right here. I’m not gonna spend much time on it. But basically, here’s what it says. It says IRA trustees, anybody know what an IRA trustee is? IRA trustee is the financial firm or institution that holds your retirement account. Okay. So what This says is that IRA trustees are permitted to impose additional restrictions on investments. For example, because of administrative burdens, many IRA trustees do not permit IRA owners to invest IRA funds in real estate. So in other words, what they’re saying right there is the company that holds your retirement account. Just because the government allows us to do something doesn’t mean that a company that offers you services have to allow us to do it make sense? So what it’s saying is, is that the company can restrict the things that they’re willing to let you do. Now, they can’t go beyond the rules, because what’s that called? breaking the law, right? So we can’t break the law. So we can’t go beyond the rules, but they can restrict the rules. But look at this last sentence here, and this is the one that I want you to focus in on it says, Ira law does not prohibit investing in real estate. But trustees are not required to offer real estate as an option. So here’s the reality of it all. You might hear that you can’t do this kind of stuff with your retirement account. Okay? It’s just not true. The IRS spells it out front and center on their website for us. So we just have to go back to the rule book.
Drew 17:05
The next paradox of learning in some ways is speed. I know a lot of you guys have asked me this question over the last couple of days as to can you read faster Can you listen to books faster and one of the things are really simple hack that he was talking about is the idea that if you like listening to audiobooks, go try and listen to them at a faster pace and sell this thing at one x
Jason Hartman 17:31
they do that to my podcast. I do that too fast. You guys listen to my podcast 1.5 or faster to you can’t do that you’re not getting any.
Drew 17:43
See, I disagree with you here. Jason. Here’s
Jason Hartman 17:46
I can go faster than 1.75 of anything. You know. Yeah.
Drew 17:50
Okay. So what happens if I disagree with you really, you
Jason Hartman 17:52
go how fast you go three times. I
Drew 17:54
think on the book, I could go three is the key there is to what happens With the paradox here is that when you don’t have like when you are when the information is coming at you really fast, your brain is forced to focus. It’s forced to focus. It’s almost like you cannot you don’t have any bandwidth remaining or doing anything else. The brain cannot think about anything else. Because a lot of times, how many how many of you have had the experience where you’re listening to a book? And it’s 20 minutes later, you’re like, oh, what happened? 20 minutes just went by, right? Yeah, you’re in a car you’re driving 20 minutes, just memory like, Oh, no. That’s because you your brain has excess capacity, it’s able to do other things. But when you are putting information in through a firehose, now it’s forced to focus now it has to be completely in the moment completely present. So you not only are you learning faster, not only is the information coming faster, you’re learning better or learning more because of the speed.
Drew 19:03
So part of the benefits of self management is step one, finding a leasing agent, finding someone in your market that knows what they’re doing what’s renting currently and how to successfully find a good tenant.
Jason Hartman 19:15
Okay, so let’s let’s talk about a leasing agent for a moment. What do you mean when you say that? Do you mean a realtor? A regular realtor who will do leases now? Yes, a lot of realtors and a lot of markets do leases some don’t. Yeah. And so, this is not a property manager offering an unbundled are all a cart service right? Just let me just define it. So you know, the property management thing has usually been throwing in multiple activities together. One, you know, marketing
Drew 19:46
and, you know, handling
Jason Hartman 19:48
the lease, writing up the lease, screening the tenants, and then putting the tenants in the property, managing any repairs or fix up and then collecting rent each month. So what you’re doing You’re saying hire a real estate agent? Yeah. And they do the lease up. Right? How much do you pay them?
Drew 20:05
Well, that’s the next thing. Part of my reservation about going with a leasing agent, a realtor to do the lease up is it was, it was property versus a property manager was it was more expensive. It was about one month’s rent, not half rents months worth of rent. But the reason for that is the property manager gets all this back end money that you don’t really think about. And so yeah, you got a great deal on a cheap haircut, but then you look in the mirror and realize you’re an idiot, you know, and so, part of the problem here is I’m negotiating up front, someone to, you know, take a good amount of time to take quality photos, market the property, go there and meet with you know, plumbers to deal with little issues. And they’re on the hook for getting me to the finish line to find a good tenant. And, and then also, you kind of have some say about what type of tenant you’re going to get into terms of, hey, do you want this tenant over here that has five kids and works on cars in the driveway? Or do you want this family that has, you know, two, I mean, and I sell just kind of briefly look over and kind of come to the conclusion of what she thinks and we’ll figure out what makes the most sense for the property. The next thing is whoops, is building a network. And so I’m I think that building that network of support in the local area, is what helps me ultimately find good vendors.
Jason Hartman 21:35
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