The Tony Stephan Show · Episode #001

How This Out of State Investor Bought His First 12 Unit Multifamily Apartment

With Hugo, mentorship and Stephan Group client, W2 worker from Los Angeles · April 13, 2025 · 27 min

Hugo was born and raised in Los Angeles and is the first person in his family to invest in real estate. He works long shifts at a W2 job, sometimes 16 to 24 hours at a time, and wanted more freedom and more time with the people he loves. After his girlfriend told him to listen to Bedros Keuilian, he found Tony's real estate mastermind, applied and joined the mentorship.

His first deal was a duplex in Metro Detroit that cost around $150,000. He has never been to it. Andrea Stephan, his agent, turned down weaker properties for him before they found this one. Hugo raised the rents from about $650 and $600 or $675 to $950 and $1,000 within a year, and he manages it himself from the West Coast with Buildium.

Now he is selling the duplex through a 1031 exchange and closing on a 12 unit apartment in Metro Detroit, found through a broker the team works with closely. Tony shows why that changes the math: an apartment is valued on its net operating income, so about $200 more per unit per month could add roughly $443,000 in value. Hugo's goal is 1,000 units, and his first lesson from coaching was to master his own finances.

Watch the full episode · Watch on YouTube

Key takeaways

1. An apartment is valued on income minus expenses; a duplex is valued on comparable sales. That is why Tony pushes clients from small rentals into multifamily.
2. At a 6.5% cap rate, every $1 of extra yearly NOI adds about $13 to $14 of value.
3. Out of state is manageable with a system: Hugo self-manages his duplex from California with Buildium for rent, requests and leases.
4. Buying a property that is already rented to tenants with a good history makes the first out of state deal an easier transition.
5. A good agent tells you not to buy the wrong property. Be relationship driven, not transactional.
6. Start with yourself: track your income and expenses and live below your means before asking a bank to lend you money.

Guest: Hugo

Mentorship and Stephan Group client, W2 worker from Los Angeles

Hugo was born and raised in Los Angeles and is the first person in his family to invest in real estate. He works a W2 job with long shifts. He joined Tony Stephan's mentorship after a real estate mastermind, bought a duplex in Metro Detroit through the Stephan Group, raised its rents within a year and manages it himself from California. He is now trading that duplex through a 1031 exchange into a 12 unit apartment, with a goal of 1,000 units.

Chapters

1. 0:00 Intro
2. 0:49 How Hugo Got Into Real Estate Investing
3. 2:50 Why Multifamily Real Estate
4. 7:06 Why Invest in Metro Detroit
5. 10:28 How to Manage Out of State
6. 12:12 Growing to Multifamily
7. 12:49 The 12 Unit Deal Breakdown
8. 18:03 The End Goal
9. 20:01 The Most Exciting Part
10. 21:46 Working With Stephan Group Brokerage
11. 23:41 Advice for New Investors
12. 25:19 How to Join the Mentorship Program

FAQ

Why did Hugo invest in Michigan instead of California?

Price. Hugo says a duplex in Los Angeles costs around $1.2 million, while his first duplex in Metro Detroit was around $150,000. Tony adds that Metro Detroit has positive year over year rent growth and that it took him and Andrea years before they spent $2 million on a single deal.

How does Hugo manage a property he has never visited?

With a system. He uses Buildium so tenants can pay rent, submit maintenance requests and sign leases in one place, and he calls local vendors when something needs fixing, the same way he would for a home in his own city. He says it has been easy and that people overthink out of state management.

How much did Hugo raise the rents on his duplex?

One unit was at $650 and the other at about $600 or $675. Within a year he raised them to $950 and $1,000. Andrea notes the rents were still at the lower end of the market so the tenants could afford them.

What is the value math on Hugo's 12 unit?

Andrea estimates about $200 more per unit per month on average. Tony calculates $200 times 12 units times 12 months, which is $28,800 a year, and divides it by a 6.5% cap rate to get roughly $443,000 of new value. This is the upside on paper: the deal was still a couple of weeks from closing when they recorded.

What was the first thing Tony had Hugo do as a coaching client?

Master himself. Tony starts every student with a personal financial statement to track income and expenses. Hugo says he still lives below his means, and Tony explains that a bank looks at the operator as well as the deal.

Hugo's First 12 Unit: Out of State Multifamily Investing

From Los Angeles to Metro Detroit

Hugo was born and raised in Los Angeles and is the first person in his family to invest in real estate. He works a W2 job with long shifts, sometimes 16 to 24 hours, and he wanted a different life: more time, more freedom and more days with the people he loves. His girlfriend told him to listen to Bedros Keuilian, and through that he found Tony's real estate mastermind. He filled out the application, did not hit submit, and then went looking for the page again. A call with Tony followed. What sold him, he says, is that Tony only wanted to take him on if he really wanted it.

He also grew up in an apartment building where the owner did nothing and the tenants fixed everything themselves. His parents still live there. He wants to be the kind of owner who takes care of the building and the people in it.

The first deal: a duplex he has never seen

Hugo's first property was a duplex in Metro Detroit that cost around $150,000. Andrea Stephan, his agent at the Stephan Group, sent him duplexes and triplexes and told him plainly when one was not worth buying. "If I would have gone in on it, probably would have been a disaster," he says about one of them.

He has never visited the duplex. It came with tenants in place, which Andrea recommends for out of state investors because the transition is easier. Hugo was nervous at first, but he set up Buildium, sent the leases through it and says the takeover was easy. The rents were about $650 and $600 or $675. Within a year he raised them to $950 and $1,000, still at the lower end of the market.

Why Michigan? A duplex in Los Angeles runs around $1.2 million. Tony points out that he and Andrea bought several 8, 12 and 16 unit deals before they spent $2 million on one property, and that Metro Detroit has positive year over year rent growth.

Managing from the West Coast

Most people get stuck on management, Tony says. Hugo's answer is a system. Tenants pay and send requests through Buildium, and when something breaks he calls someone local and lets the tenants know when they are coming. Andrea adds that even on a duplex you should keep business hours and a clear process instead of handing out your phone number. "You have to have a system," Hugo says.

Trading up to 12 units

The duplex cash flowed, but Hugo did not settle. He is selling it through a 1031 exchange and closing on a 12 unit apartment in Metro Detroit that came through a broker the team works with closely. The units are larger than a typical one bedroom and have walk out porches.

Tony explains why this is a different game. A duplex is valued on comparable sales, so raising the rent does not make it worth more to an appraiser. An apartment is valued on net operating income. Andrea estimates about $200 more per unit per month on average. Tony runs it: $200 times 12 units times 12 months is $28,800 a year, divided by a 6.5% cap rate is roughly $443,000 of new value. Every dollar of NOI is worth about $13 to $14 at that cap rate. "Do you want $400 a month in cash flow or $400,000 today?" Tony asks.

The plan after closing is operations: lower expenses, adjust rents and add the fees the previous owner was not charging, with the goal of a refinance on the 12 unit in about 12 months.

Start with yourself

When Hugo joined the mentorship, the first thing Tony told him was to master himself. Every student starts with a personal financial statement. Hugo still lives below his means. Tony explains why it matters: the loan on this 12 unit is over a million dollars, and the bank looks at the operator as well as the property.

Hugo's goal is 1,000 units. His advice to people with W2 jobs is simple: this is for you too. "If you've been thinking about it, you should do it," he says. "Especially having the right people helping you."

Transcript

0:00 How do you buy 14 units of real estate in your first year as a real estate investor? That is what we're talking about today. We have a very exciting episode. I'm not going to talk about it. I'm gonna actually bring a real estate investor who has done it and accomplished it in here. He's one of our clients at Stephan Group Realty and one of our mentorship clients. So, that's what we're talking about today. As always, I'm Tony Stephan here with my wife Andrea Stephan who is the owner of the Stephan Group Real Estate Brokerage. And dude, we're joined by Hugo. Hugo is our client. We're here in beautiful California. You're from LA. You've bought 14 units of real estate within one year, and we're here to highlight you and your success. The whole mission of the podcast and the YouTube Hugo is to help other real estate investors see our journey, but now we want to bring in other people's journeys and help them get to their goals, man. So, welcome to the show. Thank you. Thank you for having me.

0:45 Of course, man. For those who just don't know who you are. Can you tell them a little bit about you, your background, what made you want to get into real estate investing? Do you come from real estate investing? Is this like in your family or are you the first one to really get into it and want to do it? I'm the first one to do it in my family. Born and raised in LA, but now I recite in Cukamonga. I love it out there. Love it. And I got into real estate because you know what? It's crazy. You're coach Bedros. Yeah. My girl one day told me, "You need to listen to this guy." Yeah. And during that time, I was already changing my mindset, wanting to do more. And she's like, "Listen to him." So, I listened to him. I listened to his first podcast, following him on Instagram. And after that, you popped up on sponsorship. You guys were going to have a mastermind group on real estate, Fit Body Boot Camp. When was this? Like 3 years ago. Three years ago. Okay. Dude, this crazy because I was like, you know what? Always wanted to get into real estate and this is perfect.

1:31 I filled out the application. I never hit submit. I went to work and it was just lingered in my in my head and I went back to look for the page. It wasn't there and I was like, "Oh no, I messed up." After that, I got an email. You wanted to set up a call. We set up a call. You called me. The thing I love I loved about you were only going to take me if I was really into it. If I really wanted it bad. So, you weren't out there to take my money. To be honest, that's what sold me, but you actually cared. And obviously, I needed guidance cuz I have no idea what to do in real estate. I just knew I wanted to get into it. And we had our call. Signed up with you and then after that I went to the mastermind event with Bedros and it was great. I knew that I this was my calling. I knew this is what I wanted to do for sure. Love that. And I just wanted to change my life around. My life was getting boring, stagnant. My girl, she got her career in San Diego. We thought she would be back closer to home and that hasn't happened yet. And I was like, you know, I need to do something to see her seven days a week, not only three to four days a week.

2:20 And it was just more for me to grow. I know there's more out there. I want to live the life I want. Yeah. And which is having my time and my freedom. And by watching both of you and I've seen you both grow. I met you when I think you had 70 units. Definitely under 100. Definitely. Yeah. And like you say, the proof is in the pudding. I've seen you guys grow. Yeah. And I want that for my life. So I was love that, man. So you mentioned a little bit like real estate, the freedom, all that. That's why we obviously like are so big on real estate investing is it gives you the freedom to kind of do what you want when you want when you want to do it. Anything else that really drew you into real estate investing over like stocks or crypto? You know, like you said, everybody needs a roof. Yeah. And that money is 365 days a year. That's what I want. You're making money while you sleep. You don't get taxed. Yeah. With crypto, you do. The stock market you do.

3:06 I just know by experience, my older brother doesn't. And he talks about getting taxed. And I was like, I don't want that. And you guys talk about not getting taxed. And Yeah. Yeah. Yeah. In this world, someone is always going to need a roof. I lived in an apartment building myself. And the way you guys do it is it's amazing because you guys take care of the apartments. If you have to do a turnover, you guys will do it. Fix it up. Where I grew up, the owner didn't do anything. Sure. We had to fix everything ourselves. And maybe that's what drove me too. And to this day, my parents still live there. The water pressure sucks. My goal is to be like you guys. Make sure they live comfortable. They get a good experience. They don't live like how I did back in the days. Love that. Yeah. I think that's like a really good point too of like people go into it for everything you said, but you're also providing a house and a home for people and like we've talked about it too with our mentor in the apartment side about just like this is where they have Christmas, this is where they have birthdays together and things like that.

3:58 So, it's like it's their home. So, it's really awesome to hear you say things like that too. Like everyone calls like slum lord and lead you land leer like no one talks about like the positive side of it, right? Cryptocurrency could go away, the stock market, whatever, but everyone will always need a place to live and that's why we're so big on real estate, too. So, tell us about your first deal. So, you're in LA, just for context for everyone. So, you bought a duplex first, did really well with that. Now, we're put that in a 1031 exchange, and you're coming up on closing on a 12 unit multifamily apartment. So, literally from zero real estate, zero background owning real estate, and you're a W2. You're not a full-time entrepreneur, right? So, you're a W2 earner, man. But you did a duplex, did well with that 1031 exchange, 12 unit closing in. A couple weeks here. Tell us about that first deal, man. You're out in LA. You're looking in Michigan, right, with Suffering Group Real Estate Brokerage and Andrew as your agent.

4:46 How did you find it? How'd you fund it? Maybe you guys can both kind of share on this. Just tell us about that first deal. We always say like the first deal is the hardest. Once you do that first deal, like maybe talk about that like after that first deal, it wasn't as scary to go think about a multifamily deal, right? But tell us about the first deal. So the first deal, it wasn't too hard, but Andrew did help me a lot. On your profile, you'll send me multiple properties where for sale duplexes, triplexes. And I would tell you, what about this one? You're like, okay, I'll check it out. And you're like, oh no, I checked it out. It's not that good. It might not cash flow or there's a lot of different maintenance to be done. And I love that because maybe someone else would have been like, let's go in on it. And boom. If I would have gone in on it probably would have been a disaster. But just going with you guys, it you made it easier. Really flawless. And actually, the one that we got the duplex, we already had looked at it, but we were like, let's check out a couple more.

5:32 And then we went back to it and actually turned out to be a really good one. Yeah, now that you say that, I remember that we went to it and we're like, "Oh, let's see what else is out there." And I think there was like some other parties involved too of being interested in it. Well, like we'll come back to it, but yeah, it was an area that we've owned in too. So, it was like a couple streets over from one of our first duplexes. So, but yeah, if you want to kind of too like highlight on just like taking it over to like how did that feel taking it over with already existing tenants? I was scared at first, nervous. I don't know what I'm doing. And even I even told my girl and she was like, "Are you sure you know what you're doing?" Yeah. And I'm like, "Yeah, I am." And then you told me about the app, building them. I went through there. So simple. Connecting with my tenants, making sure that they have everything. I sent them the lease agreements. I sent them everything they need through there and they read it.

6:18 They went over it and it was easy. I don't know, maybe the tenants were just easy to work with. I'm not going to lie to you, it was an easy transition. No problems at all. And all the while, you're on a different coast. You're on the West Coast. So, two things I really like. Number one, I love how working with a real estate agent who's not pushy. That's really big, especially with new investors, and obviously credit to you're very good at that. You will take people to multiple deals and multiple properties, and you'll flat out tell people like, "Don't buy this." I mean, there are several agents who would be like, "Oh, no, it's a great deal." Or, "Oh, no, just go, right?" Cuz all they care about is a commission. So, be relationship driven, not transactional. If you're a real estate agent listening to this, a lot of people are nervous of out of state real estate investing because they're like, "I'm not going to be there." Have you ever been to that duplex? Never. Never. Yeah. Kind of crazy. We went to the mastermind. We were going to go check it out, but I didn't have time. Yeah. But I was like, it's okay. I think that's where people get really thrown off with it.

7:06 Kind of like stumped with it. So, why did you choose Michigan over investing in California? Like, what was the big draw there? Anything like you really were attracted to with Michigan? The price. Yeah. It's expensive here in California. Yeah. And you get a lot more out of state than here for sure. Especially if you're starting off. What would a duplex in LA cost? 1.2 million. Yeah. Just depending what part of LA, but we're talking millions. We're not talking 500,000, 300,000. No way. That is crazy. Would you mind sharing how much was your first deal in Michigan? Yes, it was 150. It was around 150. Yeah. So again, I think that's a huge thing for people listening in like these coastal markets who feel priced out like right that barrier to entry is like inconceivable. I don't think we spent 2 million on a deal until years. I think our and it was multifamily when we were over 2 million was the 56 unit.

7:53 So we had bought several eight units, 12 units, 16 units, all under 2 million as to where here in LA you're getting one, maybe two units for 1.5, 2 million. So the barrier to entry is so much higher. It's like more nervous as an investor. So I love that and that's why we push people to look at Metro Detroit. There's positive year-over-year rent growth. You were able to increase the rents in your first year. I did. Yeah. Do you mind sharing like where were the rents at and then where were we able to get them to? Yeah. So one of them was at 650. Wow. And the other one I think 600 or 675. I raised one to 950 and a,000 in a year. You know what I mean? Substantial. That's what I mean. Like 650 R is crazy, right? Because that was a nice area. Yeah. Yeah. No, and that too I remember having that conversation. I was like this is a comfortable one. Like if you want to go a little higher, I know on like the bigger unit like you could, but I mean it definitely wasn't necessary at that point.

8:42 So that's even just saying like he was a like slightly below market rent or at the lowest part of market rent. So, it's a good strategy because you don't want to go so high to where maybe they're pushed to be able to afford it and then they can't afford it. They move out. So, dude, that's huge. That's another thing with like investing in Michigan. You can still find $600 rent that should be $1,000 and that's where you make your money. You know what I mean? So, a lot of people are nervous to invest out of state. Would you say like your experience has been really good or any advice you would give to them who are thinking about it? You know what? It's really good. If you're thinking about it, you should do it. Yeah. I'm not lying. Yeah. Because you need to start somewhere. And by my experience, I'm telling you, it's worth it. Especially having the right people helping you. Sure. It's going to make it easy. And if you need contacts or any help with the property for maintenance or anything like that, you already got the people to do it, right?

9:28 And Andrea, you help me so much. You're quick and everyone has gone out there to check. It's minor things, but it's been easy. I want to say the network, the people, you know, you know, you come through for them, they'll come through for you. Working together makes it a lot easier. And I just want to let people know if you're thinking of investing out of state, do it. Yeah. Don't be scared. It's good for you. Yeah. It's growing. Yeah. Yeah. And on that point, too, that's kind of why we looked at that duplex of one where the rents were at knowing we could increase the rents according to increasing expenses or anything that might come your way. But I always encourage that on out ofate investors. We just closed another one that was already tenant occupied, already going to stay another year. So that way too again it's like an easier transition instead of okay now I have a vacant house I have to fill it I'm not quite sure I can tenant screen but I think that's kind of the easiest way to ease into it is if you are out of state and it's already tenant occupied and tenants are paying they have a good history just an easier transition to kind of get used to the market.

10:28 What would you So, a lot of people get nervous about the management, right? So, you're obviously managing yourself. How's your experience been with self-managing your real estate from out of state? It's been easy. Okay. Yeah, I'm not gonna lie. It's been easy. That's great. No, that's so many people get hung up on that, right? How am I going to be able to manage this? You know, I think people just overthink that. And maybe it's an excuse for them not to do it, but it's not because you already have the resources. If something goes down, just like your own property at home, you still have to call someone from wherever city they are from. They have to come to your property. Yeah. And the way I see is like the same out of state. I'm just going to make a phone call and they're going to tell me I'm here. I'll tell the tenants, "Hey, they're coming in on Wednesday. Be ready 9:00 a.m." And they're like, "Okay, cool." Anything to add to that or I think when we talked in the beginning, we said, you know, I explained how some people do it, but just having a system in place like Buildium so that tenants can pay through there.

11:14 They can submit their requests through there. Cuz like one thing that I always advise on too is like even though you might be starting with a duplex or a house, not to just give out your phone number. If you do give out your phone number, you're putting a like a structure in place to say like it's still a business 9 to5. So that way there's a system to how they're communicating, how they're submitting requests. So would you say that was helpful to have a system in place? Oh, big time. The system makes it a lot easier. You have to have a system. Going erratically, being mediocre about it's not going to work. But with the system, it made my life a lot easier. I'm busy at work. I'm busy at home, busy with my girl, and I'm still able to manage it easily. So you have you have two units. It's doing well. Cash flowing, right? You were successfully able to increase the income and all that. You're managing it really well, but you don't settle.

12:00 You told us, "Hey, we're looking for a 12 unit. We want to be able to do this." Found something, you know, put that duplex into 1031 exchange, so you're going to sell it, you know, make a profit, not paying any tax on it, which is the beautiful side of real estate. What made you want to go from single family and just your duplex there, which you could have just chilled with, into multifamily? What was the pull to keep growing with that? Chasing financial freedom, to be honest. Living the life I want. Sure. Freedom, time, seeing my loved ones, seeing them all the time. I'm busy at work. I work 16, 24 hours a day sometimes, and I go home the next day, I'm just tired. I'll sleep in four or five hours, but I could be in a mood with multifamily with you teaching me the cash out refinance, but obviously doing it right. But with that cash out refinance, getting more apartments, getting more apartments, just growing and growing and growing, and just watching you grow, I visualize myself just like you and I'm like, that's what I want to do.

12:49 So, let's talk a little bit about the deal that's getting ready to close. So, like how'd you guys find it? What's the location? You don't say the exact city, but like what's the upside? So, obviously, it's a BRRRR strategy deal, which we talk about a lot here. And if you guys are new to watching this and learning about what this is, burst strategies, buy it, right? You got to buy a value ad deal, which is a deal you can improve. You have to be able to increase the rental income, right? We don't just say rent it out, but you have to improve the profitability of an apartment. An apartment's valued based on income minus expenses. Your duplex can only be valued based on the comparable sales of that area. Yeah. Right. So, even though you got the rent up, it doesn't inherently make the duplex more valuable. Now people will pay more for it because it's renting for more, but when the appraiser comes in and appraises it, they're going to look at comparable sales. With an apartment, the more money, the more profit the apartment makes, the more valuable it is. So, we like to rent it up, but increase the income by lowering expenses, increasing income, be able to refinance it, right?

13:40 And then repeat the process. And repeat it means take that money out and go buy another deal, which is exactly what you just mentioned there. So, tell us a little bit about the deal. How did you guys find it? I know I was involved a little bit, but tell us about it. Yeah, so for this deal, it's through a broker that we work very closely with. So that's another thing. It's also like who you're buying from, right? So I always look out for it. I'm not saying that, you know, to speak ill on any brokers, but you just know that it's going to be a good product and that it's going to close, right? So it's cuz something might come to you off market or it's listed and the seller might not be as ready to sell as the broker might think. But when I see something come through from this broker, I'm like, "Okay, we have a good deal coming our way." That's why I was excited to send that over to you. It's in Metro Detroit. So, again, we're in areas that are just appreciating with value. So, this one's probably about like 30 minutes from where you're at right now.

14:27 So, yeah. So, what's the upside, though? Is it just going to be eliminating the expenses or lowering the expenses? Is it going to be better management? Is it more upside play? It's a little bit of everything. That's great, though. That's what we like. We don't just ever want like, wow, the expenses are so tight already. There's a little bit of rent increase there. We love both. I love when I see a P&L where there are so many expenses on there because that's how you know you're like, "Wow, I can really cut that down." So many people think it's just buy a property, raise the rent. Well, no, it's manage it better. It's operate it better. So, can you like explain a little bit how much rent increase are we talking here? Yeah, I mean, I think we're a few hundred off on certain ones, which is really cool about this property. They're bigger units than a traditional apartment, right? They're not just like one bedroom, one bath. They have like a walk out porch off the back, which are really nice. So that way too, again, it's just like the overall look of the property is a little bit more than just a traditional apartment.

15:17 So those are always nice because when you're looking at comparables in the area and they see a onebedroom, one bath, oh, there's a onebedroom, one bath over here. They're like, I get a little bit more in this area. So you have that upside as well. So then also too, then we're seeing like the expenses, right? So that's where coming into play with like using our contacts and you'll be managing this one as well, correct? Yes, I will. Yeah, definitely. Like you said too, when you when you have a good agent and broker, you get their like rolodex of team members. You need a team, right? Right. It's not just an agent or broker and if you're managing, but like you said, who's doing the repairs, the maintenance, all that. So, what would you say like 200 bucks per unit? Yeah, I would say on average. So, like this is crazy, right? $200 time 12 is 24,00 bucks. 12 months in a year though, $28,800.

16:04 You can increase the income. But as you know, maybe our listeners or viewers don't know, that is a multiple, right? So you divide that by you say maybe a 6 12% cap rate for this area. That is $443,000 of new value that you can create in this property. There's no way you could have created $443,000 new value in that duplex. Not at all. Not in the foreseeable future is ever going to sell for $600,000 from $150 to $600,000. But this apartment, you can do this in under a year. It's crazy, right? That's the power of it is understanding that it's an NOI. It's an NOI game. Now, compared to like a comparable sale game, right? For every $1 you can increase the NOI divided by the cap rate, that's your valuation increase on a six and a half cap, that's like 14 bucks, give or take 13 bucks. Yeah. So, every dollar you can lower the expenses or increase the income, you're earning $13 in valuation.

16:52 Like for someone who wants to grow wealth and multiply wealth quickly, this is the game to do it because like I said, it is virtually impossible barring like hyperinflation where we're all screwed anyways. So maybe your property value went up and then the dollar's useless and we're all just living in pandemonium. There's just no way you can do that. And I really wanted to like share this example with our viewers and our listeners cuz we're always thinking like, hey, what do you guys need? Meaning you guys at home. Sometimes Andrea and I feel a little unrelatable because we're moving at like a higher level these days, but like man, this is so achievable for people and we get so many people who come in like I have this duplex. I don't want to sell it though cuz it cash flows. Well, I mean, you had cash flow. You had great cash flow. Why are you giving it up? I mean, this is why exactly. Do you want $400 a month in cash flow or $400,000 today? $400,000 today. Cuz that $400,000 you can go redeploy it and turn it into 600 800.

17:40 So, I really appreciate your story because you're just kind of like knocking down a lot of limiting beliefs for people. I can't do it cuz I've never done it before. I can't do it cuz I'm a I work a W2. I work I mean, you said you work 20our days. Yeah, 20 hour days, right? So, excuse me, your 8 hour day job, you know what I mean? Well, I already have a duplex and you know, I don't want to give it up. Like, you're just kind of knocking down their limiting beliefs, which is huge. What's the end goal with real estate? Where do you see yourself going? Andrew and I expressed like our goal is to a,000 units. What's your end goal, man? My end goal to be honest, same thing. Thousand units. Yeah. Thousand units. I just want more and more. Yeah. And it's exciting. I fell in love with it with the numbers. Obviously, I'm gonna go bigger now and I'm actually getting more into it. But not to say that I'm scared, maybe nervous, but I enjoy it. It's just different. I'm learning. Yeah.

18:26 And it's awesome. I just want to keep doing it. And for like people that have W2 jobs, Yeah. Don't think this is not for you. It's for you. If you've been thinking about it, you just got to learn how to manage yourself, your mindset, money, where you spend your money, do your financials. And going back to you, when I first got you as my coach, very first thing you said, I had to master myself. Yeah. So, I had to do my financials. I had to watch out what I was spending. Y and I actually to this day, I still live below my means. Have to. Worth it. Love that. All right. I'm so glad you mentioned that, too, because we get so many people come in and want to do this. First thing I start every student off with is fill out a fast, personal financial statement. Track your income expenses and like you said because if you're if you're a bad steward of your money how are you going to manage an apartment building you know what I mean I mean you make a great income but you could spend way more than that you know we I mean we've seen people come in with multi6 figure salaries and like have nothing because they're not stewards of their money I'm really glad you said that too for someone maybe wanting to start this journey start with yourself how do you manage your own money what's your level of like financial discipline because right if you're broke on a piece of paper why is the bank going to want lend you money.

19:33 Even if you have partners and all this, if you want to control the deal, you're like the operator, the bank's going to look at you. Exactly. And they're like, "Dude, you're not good with your money. Why are we going to give you millions of dollars?" Like your loan on this deal, is it over a million bucks? It is. Yeah. A million dollars. Yeah. There is a level of like they're looking at the deal, but they're looking at you. And your track record with doing well with your duplex, doing well financially on your own, right? You knocked it down. Yeah. And it got approved and you're closing on it. You know what I mean? So, I love that you said that. Start with yourself. What would you say is the most exciting thing about going into the 12-unit property once you sign the papers? Like what's going to happen? Operations. Operations. Yeah, operations. If we have to lower expenses, how much we're going to raise the rents? Yep. And fees, what the owner wasn't doing, and now what I could implement into the apartment buildings. Love that.

20:18 And that's what we're going to do after you close. We're all going to get on a call. And that's the big thing, too, is like Andrea is highly involved with this cuz she is the operator, right? You're the master operator of these apartment buildings. You know, we're going to start to look at the business plan. That's what we always say like, "Congratulations, we've closed." But now you're on the clock. Now you're on the clock to get to that refinance on a 12-un deal. You can be able to refinance that in 12 months. We're on the clock of like, right, what can we do? So that's when we start to look at, okay, it's not just about pushing rents. It's about what can we start to eliminate quickly cuz you're going to close. So spring will be coming up. So like spring cleanup, who's doing the grass, who's doing those types of things. Like we can start to shop all those, bid those out. What are some other quick things as he takes over like you're going to help him implement? Yeah, I think just implementing kind of like what we did at the duplex. Just let them know right away. Always like letters. So that's something too like we did it for the duplex as well.

21:04 Just sending someone from our team to just post the letters. There's always a little bit of push back from that. That's from day one. And then also too just like looking at correct because what is 12 unit? I know that they're not charging any fees or if they are just not like the appropriate fees. So if you look at any lease that is from like a higher level property management. I mean there is a fee for everything. And then like I always say too, I'm like even I just had the conversation yesterday that now there's going to be a fee on the credit card or a bank account where before it wasn't a fee for this. So I'm like everything is going that way because there's an expense on everything. So I always say like we have to look at what we're now getting charged for and account for that. So it's always like a checks and balance with that. Love that. What would you say has maybe been your biggest takeaway from working with Andrea? She's really easy to work with.

21:51 She makes everything flawless. You need something, she'll respond real fast. I text her right away and it's not even five minutes sometimes and I'm like, "Cool." It just shows that she cares a lot. She's not only looking out for herself, but she's looking out for you, too. It's amazing because me working with you, that's something that I want and I think other people want, too, that they want to feel important. You do obsess over like your clients and like being so hands-on with them and like making sure you push things through. You know, your reputation means a lot. You know what I mean? Well, and we've been there. We've been in those spot. Just speaking on the duplex side of it, like when I'd walk in some of those duplexes, I'm like, I remember this. I remember being in some of these. I remember like the first times not knowing what a foundation crack is or like how bad it is and stuff like that.

22:36 So, it's just more like I always look at through Arland. We're more on the obviously we're doing this for an investment. And I understand too the fact of like this is your hard-earned money now going into an investment. And that's why it's like no disrespect, but like would you would you work with a real estate agent or a broker who didn't own investment properties? No, not at all. Yeah. You're like us. You're very habit based. How you do anything is how you do everything. I've been loving watching your journey on social like you're documenting the workouts and like getting in great shape and like you know talked about giving up alcohol and all those things. And it's like that's why we created this brokerage. We are walking the walk. We feel every family should own at least one piece of investment property real estate. But, you know, they're just these brokers and agents out there selling the product, but they don't believe the product. They don't own the product. You know, maybe they believe in it, but hypothetical is hypocritical.

23:23 They're going to walk you through an inspection, but like she said, she remembers when it was our hard-earned money on a deal that size. It's a different perspective when you work with someone who's been there and done that cuz then you profit from their mistakes. My first deal wasn't a duplex and my second deal sure as heck was in 12 units. Someone watching this and they're like, "Okay, feels good. Sounds good. I like this. I want to get started with real estate investing. Maybe I'm looking out of state. Maybe I'm just looking to get in there." Like, man, you did it. It inspires me. What would you say to them? Do it. Go ahead and do it. The investment is worth it. The return of investment is infinite. It really is. Yeah. Seriously, mentorship, coaching is the way to go because like you said, I went from two to 12 in a year. And now you're already like, "What? Where's the next deal?" I think for our next video, next time we do this, we got to get you out to Michigan to the 12 unit.

24:12 Comment below if you'd like to see Hugo come to Michigan. We walk the 12 unit. You got to go to the 12 unit, get some photos. It's a weird feeling when you pull up to 12 units and you're like, dang, this is mine. Duplex, you feel a sense of pride, but when you start pulling up to multifamily, you're like, dude, this is mine, right? It's a cool feeling. Love that. So, yeah. Guys, comment below if you'd like to see that. Dude, thank you so much for being here, man. Oh, no. Thank you. Like, you know what? I always wanted a podcast. I always I was like, hey, I want a podcast. I have my own podcast. I don't know when, but I'm going to do it. And then you told me about this and she's like, "No way." She even took the day off today. She's like, "I want to see your reaction after." She's like, you know, investing, but I'm here, too. I'm doing a podcast with you guys. It's amazing. Is it? It is. That's what I mean. When you start putting yourself out there and you start growing, you start expanding. It opens up new things. You're doing a podcast. You launch your own podcast. You're doing social media. So, if people want to follow your real estate investing journey, where do we send them to go?

24:59 You can find me at on Instagram at Never Tired Fit. I call it Never Tired Fit because I'm always going. I'm always going. I'm never tired. I'm never going to give up. I'm never stopping. Hugo, dude, thank you so much. Appreciate you sharing your story, man. This has been great. Honestly, thank you. I appreciate being here. You guys are awesome. Yeah, likewise. So, yeah, guys, comment below if you want to see part two of this where we go to Hugo's 12 unit and check it out. Let us know. All right, so you just got to see a great case study video with one of our very successful clients, Huga. And hopefully, I want him to come share his story to inspire you and your journey. He went from zero property, zero real estate experience. Is a very busy W2 worker and he bought a duplex and now is buying a 12 unit multifamily property. Like I always say to you guys, it doesn't take many rental properties to live a great life. He's definitely on the trajectory for that. So, if you were inspired by this, let us know.

25:45 Drop a comment below in the comment section. Leave a meaningful comment. Make sure you comment, like, and subscribe on this video. Most importantly, if you want to learn more about that mentorship program that Hugo alluded to that he said helped him go from zero rental properties to now owning a 12-unit multifamily property and building up to a,000 units. Click the link in the description. From time to time, I do work one-on-one with select clients. And my goal is within your first year of mentorship, just like Hugo, you are going to buy, own, and operate your first multifamily deal. It's not just about finding the deal, negotiating the deal, and buying the deal. It is about operating the deal. Operations is where the millions is made. So, click the link in that description, learn more about the mentorship program. Love to have a conversation with you and see if this is a good fit to you. See how I can add value to you and maybe you'll be like Hugo and within one year owning your first multifamily property.

26:34 So, do that right now. Click the link in the description. Until next time, we'll talk soon. Text.

Topics: First Deal, Out of State, W2 Investors, 1031 Exchange, BRRRR, Property Management

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