From Setbacks to Staying Power Building Wealth That Lasts with William Holder

Transcript

[Mattias]
Welcome back to the REI Agent. We are here with William Holder. William, thanks so much for joining us.

[William Holder]
Thanks, man. I appreciate you having me on.

[Mattias]
Yeah, excited to dig into who you are and what you do. But to start, can you give us a kind of bird’s eye view of who you are in real estate?

[William Holder]
Sure. Yeah, absolutely. In real estate, I am a team leader.

I run the William Holder Realty team. We do about 240 transactions. We did about 240 transactions this year.

We’re located about 20 minutes outside of Philadelphia on the main line. We service all of the counties surrounding Philadelphia, including Philadelphia, some of South Jersey, and Delaware. I’ve been a full-time real estate agent for 10 years.

I’ve had my team for five. We’re really just kind of hitting our stride in terms of the real estate team side of things. I’m a broker as well, and honestly got into real estate to be an investor.

So we’ll talk more about that.

[Mattias]
Yeah, perfect. Perfect guest for the show. There’s a lot of people that…

There’s many ways to the path of enlightenment, getting into sales and then starting to invest like myself or some people just have their license to do their own deals. So William, what got you into real estate to start? What made you get your license?

[William Holder]
So about 2011, I bought my first house. I was 23. Yeah, 23.

And I worked at a bank. I was doing loans, repo, buying houses. I’m like, I should probably buy a house.

Absolutely. Hated renting. I rented from the time I graduated high school until that point, and it was pretty horrendous.

So I always knew I wanted to be a homeowner and bought a house, had a job, was making a decent salary, $50,000 a year. I was fine. My wife was a teacher and we’re just kind of moving along the regular pace of life.

And I stumbled across a book called Rich Dad, Poor Dad, which I’m sure you’ve heard a ton. The reason I found this book was because I moved to America in 2002. I moved here from the Caribbean, a little country called Trinidad.

And we grew up fairly poor, not a lot of money, and didn’t really know what I wanted to do when I moved here. I moved here in the middle of high school. It was a pretty tough time to move for any kid.

So I just played around with different jobs after high school, got into banking and just felt myself kind of falling into this hamster wheel of working two, three jobs every time to just make ends meet. And I was at my mom’s and she was talking about the fact that our house in Trinidad that my granddad built needed a roof. And I’m like, oh man, how are we going to come up with that money?

And she said, don’t worry about it. The rent will pay for it. Because ever since my granddad was getting older, he started to convert that house slowly into a four-unit home.

It used to just be one single house. And I’m like, wait a minute, what do you mean it’ll pay for it? She’s like, yeah, the rents that we put away money from the rents.

And it started to click in my head. I’m like, wait a minute, this is why people buy investment properties, right? So I read Rich Dad, Poor Dad.

Of course, I Googled investing in real estate and Rich Dad, Poor Dad came up. And I won’t lie, I didn’t read it. It’s going to sound horrendous.

I don’t read a whole lot. I listen to a lot of podcasts like this and a lot of audio books. I’m on the road a lot.

So reading isn’t something I have a ton of time for. And the book kind of brainwashed me. I mean, it did.

It’s a real simple book. Everyone, hopefully everyone that’s listening to this has read that book. It’s simple, but it gives you the basic framework for what building a life out that doesn’t require you to constantly be looking for the next best thing, looking for the next paycheck, looking for the next opportunity.

It’s a different lifestyle, something that I never thought. And I never thought I wanted to be a business owner or anything like that. So naturally I thought, well, I’m going to be a real estate investor.

I should get my real estate license, right? I mean, I just bought a home and my agent seemed to not love the process. I did.

And I’m going to get my license. Got my license. The problem is I found out you need money to buy real estate.

And that was something I did not have a lot of. I was 25, just bought a home, pretty broke. So I had to figure that out.

So of course, like silly me, I’m like, let me get two, three more jobs and just work nights and evenings and weekends and save. And it was never happening. I mean, we all know what happens.

Something breaks in the house, your car stops working. This bill shows up that wasn’t supposed to show up. The taxes were higher than you thought.

And I just kept going away. And I was in the same circle and just realized I was never going to get out of this unless I tried something different. And then I’m like, well, I have this real estate license.

Maybe I should go sell real estate. It’s what I want to do anyway. So that’s where I started talking to friends, family, didn’t know a lot of people.

So I had to find ways to get in front of a lot of people. And by 2015, I was so busy. I was going running outside on my lunch, on my breaks, making phone calls, negotiating deals.

And I just felt the pull. And it happened organically as well. I was hitting a ceiling at the job I was at and had a great boss.

I was unhappy. In your mid to late 20s, what am I going to do with the rest of my life? And I got to get out.

So I decided, I pulled the trigger. I talked to my fiance at the time and I said, hey, I know we have a wedding in a year. This is probably not ideal timing, but I want to quit my job.

And she said, hey, if that’s what’s going to make you happy, go do it. Credit to her, she believes in me.

[Mattias]
It’s a good test, William.

[William Holder]
Yeah. I say this because about six months in, I thought, man, I need three more jobs. I was doing all the things, like door knocking, expires, for sale by owners, online.

I was doing everything, running out of money. And I thought, man, I got to go drive Uber or do something to make ends meet. And my now wife then fiance said, she said, if you do that, you’ll never commit to this.

And this is somebody that she’s a teacher. She doesn’t do business, but she knew me. She knew like if I went after something else, I would fall out of this.

And I’m happy I didn’t. I mean, that first six months were horrendous, but I got through it. And then my first full year in real estate, I sold 36 homes.

And then the next year, 39. And in those two years where the investing came back was, I was working with these investor clients who I didn’t know the game. I didn’t understand flips really.

All I knew was that Redbridge that we’re after. And I had these investor clients, they’re brothers. They seemed like nice guys.

And they were like, yeah, we have all this cash. We’re looking to do flips. If you did real estate pre COVID, it was pretty easy to find deals, right?

Like in any market there were, I mean, in the best markets around here that you can’t buy a house for anything less than 50K over asking anymore. In those markets, I was finding deals and I was bringing them to these guys and they would buy like the third one, I realized the pattern. They were like, oh, we’re losing money on this.

And it’s not turning into a good deal. And would you like cut your commission? And as a new agent, I felt bad.

I felt terrible. I’m like, I want to help these guys. I want to make it work.

I worked with them. And by the third one, I’m like, what is going on here? There’s no way these three deals were this bad.

They were all in some of the top markets around here. And looking back on it now, I know better. I was getting plenty, but back then didn’t know any, right?

So I decided to get a flip for myself, right? Again, no experience, not a lot of money yet. I was doing well in real estate, but I was just catching up.

I was getting back to green from all the red. And a property came up and it was in a great town, but it was a gigantic project. I mean, way bigger than I should have ever gone for, ever.

And I know that now. But then 2017, I’m like, I’m going to go do this. So I talked to my sister.

I’m like, figure this out. You got a little bit of money. I got a little bit of money.

We’ll do a 203k. I got super creative. I was one of those people.

I probably shouldn’t say that on here. I might get arrested. But I did that and it was a nightmare.

It was three years of absolute torture. I made all of the mistakes. I hired the cheapest contractor and then they took off and filed bankruptcy.

The second contractors I had, I thought I did the right thing. I thought I went to their job sites. They demoed the house because it was that bad.

And when I gave them my first draw for framing, they filed bankruptcy. And then I hired a lawyer who I found out was being disbarred when he took my deposit. And then finally, this is a year and a half in, 200k in the hole.

Literally, I was selling houses to just not go bankrupt. I was literally digging every sale I could find to keep up with the debt of this project. I didn’t want to fail my sister.

I didn’t want to fail myself, my wife. I wanted to make this work. And went back to one of the first contractors who was the right bid.

And knowing what I know now, I would have just hired that guy. And he helped me piece it back together. He came through.

I found ways to pay him. I was literally borrowing off lines of credits and whatever I could to make this work. And finally, in 2020, March of 2020, the house was complete and I put it on the market and COVID it.

I was like, I think I should jump off the Ben Franklin bridge at this point. This is never going to work for me. I should just give up.

I don’t know what I’m doing anymore. So, I moved into the house. We had just had our first daughter and I had literally no way to pay all this debt back.

So I said, well, I’m going to sell my first home, which I’ve got some good equity on over the years and use that to get back to even. Looking back on it, I’m super happy I did that because that house is now worth $400K more than it was in 2020 due to the acceleration of the market with COVID. And in the time I did it, it was the worst thing ever.

I was pretty depressed, making everything work. It didn’t make life great for three years. But looking back on it, it gave me the tools I needed to do what I’m doing now.

And my silver lining is it was my bachelor’s degree on how not to do real estate. So yeah, I paid for a college degree on how not to do real estate.

[Mattias]
You didn’t realize any loss then, right? You held it long enough that it became- Yeah.

[William Holder]
At the time, I paid everything off. I paid my sister. Everyone was back to even.

And now, actually, because of the acceleration of the equity in the property, I took a lot of credit on the property, and that has helped me accelerate my investing as well. So one lesson learned there is time heals all wounds, right? You wait long enough, you’ll fix this.

[Mattias]
Which, yeah. I’m sure if there was a shortcut or a… Maybe not a shortcut, but having somebody help you avoid some of that pain, you probably would have taken it at the time.

But that’s kind of the beauty of real estate too, though, is that it’s usually… People often think this is a zero-sum game. So I’m going to invest $200,000 on a piece of property.

I could lose all that money. And through that whole time, that would have never been the case for you. I mean, when you completely demoed the house, and if you would have sold the land, that might have been a pretty big loss.

But yeah, you found a way out. And I’m sure that’s an amazing lesson that you can take with you from a lot of different things. Resilience is key there, right?

[William Holder]
Yeah. I’m sure you’re aware of Jocko Willink, the Navy SEAL, awesome guy, but he’s got that extreme ownership thing. And that’s honestly one of the reasons I’ve been okay with what happened is at the end of the day, I chose to do that flip.

At the end of the day, I chose those contractors. At the end of the day, I wrote those checks. And I even chose the lawyer when three other lawyers told me not to do it, right?

And you can’t pierce the corporate veil. What do I know? So that’s the way I looked at it.

This is on me. I’m a grownup. I need to dig my way out of this.

And I did. And it’s made right by everyone. No one was ever wronged by it but me.

And looking back on it, like I said, I now I’m super honest with every investor I meet. And I run a seminar called Grid Delco. It’s once a month and I have it through Zoom in person.

And I don’t get the biggest following because people come, but a lot of times they don’t come back. I’m not scaring them to a point, but I am being just honest. I’m not selling the fluff, right?

You see on Instagram, the Bugattis, and here’s how I bought 7,000 doors. And you’re like, that’s not what this is, right? In my experience, real estate investing is just another version of a 401k, right?

It is a long-term investment that you’re putting money into. And if you’re running it correctly, which was another thing I’ve had to make adjustments for in my business since, and I’ll talk about that, but it can be very profitable over time and the equity and the depreciation. All of that will add up, but if you’re not willing to put five years of sweat, even if you’re not physically doing the work, if you’re not willing to put in that five years, don’t do this, right?

Just keep investing in the S&P 500.

[Mattias]
It’s true for sales too. I think there’s usually a grind phase where you just have to be okay with feeling like you’re just climbing uphill constantly without any kind of reward and then things start turning. I think that you could…

If you did the house hack model, where you’re just putting low money down, saving up for the next house, moving, and just… I think the hard part there, especially if you’re building up a sales career, is that you’re going to want to buy a nicer house than one that would make a good rental. But I think that model could be really good.

And I think for a lot of agents who may not want to be full-time investors, they just want to have that 401k. I don’t think there’s anything wrong with base hits. I think people don’t need to get the perfect birth.

They don’t need to do all that, especially at the beginning. I think if you start slower, you can build up that equity. Like you said, get equity line of credit on the property and then use that to help fund other deals.

Typically, you need a lot of cash to invest in a fixer-upper. It’s going to be a foreclosure or whatever. And it’s often two weeks cash close.

So yeah, if you start with the smaller hits… And if you don’t even get to the more complicated stuff, especially if you’re in an appreciation-heavy market, you’re going to probably beat the S&P 500 just by sitting on the real estate. I just did some analysis in my local market.

I was able to find… We have a blogger that does really detailed analysis. I was able to find the median sales price back to 2000.

And I was like, okay, if somebody just did 20% down, bought a property back then, held on to it until now, so 25 years, versus took that down payment and put it into the S&P 500. So the down payment, it was like 116 was the purchase price. So the down payment was like 23,000, something like that.

And then that 23,000 in the S&P 500 grew to like 178, somewhere in that ballpark, where the median sales price now is around 350. So if you don’t even factor in any of the cash flow, any of the depreciation, you’re sitting at a pretty big difference. You may not have the mortgage fully paid off.

There’s five more years in a 30-year mortgage, but obviously that’s done a lot better. So even just sitting on… Like if agents would get like five houses and just sit on them.

If you’re going to get out of the game because you can’t handle the tenants, you don’t want to manage them yourself, try that out. Don’t fix the toilets. That’s something that I drew a line on.

I’m like, I’m not fixing toilets. That’s going to make me hate my life. I’m going to sell my rentals.

Because it’s not about now. It’s not about getting that Bugatti now. It’s down the line, it’s going to be worth a lot more.

[William Holder]
Yeah. And look, I’m not all poo-poo. I love the Burr Method.

It’s what I’ve done for the last five years. We have 70 doors. I’ve done probably 12 flips and about 20 properties total throughout Pennsylvania.

I haven’t invested in other states yet. I still kind of like the control aspect. And I’ve had really not the best luck with property managers.

So I like to pseudo manage, partially manage my own property still. I think that’s probably more a control thing for me than anything.

[Mattias]
I’m the same way. Yeah.

[William Holder]
Yeah. I just, I don’t think anyone’s going to take the kind of care of it that I will. I’m going to drive by a couple of times a year and make sure there’s not vines growing up the wall.

And I found it just happened over and over and over again. And I just couldn’t, I mean, I lost a lot of money because of property managers. But that all being said, I didn’t stop getting through that.

And while that was happening, I did a couple smaller transactions that were good. Getting through that and learning that honestly earned me a lot more respect than anything else. And from that, I had clients who knew me, knew my story from, and I was being really honest about it.

And they were like, hey, we’re thinking about this real estate investing thing. Would you want to partner? And I’m like, me?

I was like, did you hear what I just told you? And they’re like, well, you’re obviously learned a lot more than we do. And we think you’re going to take this somewhere.

And I’m like, okay. And here we are five years later, a lot of equity, a lot of depreciation that helps me as a business owner. Cashflow is great.

But the one thing I would say to people that do BRRRRs, and this is one thing I learned, is that yeah, the BRRRR is awesome. It’s my favorite type of real estate investing. That being said, you can’t just do BRRRRs because they’re never perfect.

It’s rare, even if it’s a 10 unit, 11 unit building, that you have the cap rate perfect and you do the math exactly right. And you’re really good at this and you know how to do it, even at where I’m at, or even super successful investors that are doing a lot more than I am. You’re going to leave money in it.

You’re going to, it usually happens. And if you’re constantly doing BRRRRs, that money’s coming from you. So that year that you would have maybe made X amount, you’re making less to hold that BRRRR.

So I’ve learned that we had to switch our cadence up where it was sort of just BRRRR, BRRRR, BRRRR. It’d be BRRRR, flip, BRRRR, flip, BRRRR, flip, or two flips while we’re doing a BRRRR. And that has changed the entire system.

You know, because I found that now the BRRRRs, the flips are the income to our business.

[Mattias]
Right.

[William Holder]
Right. And just doing BRRRRs, you’re not actually making any income until you’ve turned them over. So in the meantime, you’re just expenses.

So once we changed that up, it was a game changer. And again, I learned that along the way. I know a lot of people don’t like I get it.

You got to pay taxes. It sucks.

[Mattias]
Yeah. Well, I was going to say too, though, like with that method, you’re going to be able to have some accelerated depreciation from those BRRRRs that you’re holding that can help offset the profit from the flips. If people don’t understand what a BRRRR is, it’s basically a flip, but instead of selling it, you’re refinancing it and you’re trying to get all your money back out that you put into it.

So the equity that you create by making it nicer is what you ideally keep in the property and get the money out through a cash out refinance. And then, yeah, doing the accelerated depreciation can help offset your commission, but also like that flip income as well. So I mean, that makes sense to have that kind of mix.

We don’t have a huge market and it’s been harder and harder to find deals around here. But typically my cadence was the ones that I was in an area I liked, what I want to keep long term, I was going to do a BRRRR on it. And the ones that weren’t as ideal for me to keep, I would flip and sell.

So not intentionally that way necessarily, but that’s kind of the cadence that we were going to.

[William Holder]
No, you figured it out way quicker than I did. And I feel like I’m falling backwards into being a successful business person. I do it all the wrong ways before I get to the right way.

And I think that’s great because it’s also, I teach my investor clients, my agents how not to do it because I’ve done it all the wrong ways. So they’re accelerating so much faster than the 10 years it took me to get where I’m at because I can help them sidestep all of these errors. And you learn, I’ve walked into properties eight years ago where I’m like, oh, this doesn’t look right.

And now I’ll walk into that property and lose it on the contract. What is going on here? You’re basically putting up drywall to get to the next draw.

I know what to look for now. I know what the games these guys play and I know when to call people out on it. And you have to have that experience.

And like you said, and this is probably something, again, I learned way too late, get a coach. Like get a coach. I truly did not, in every aspect of my life, didn’t appreciate what coaching does for you.

In my real estate sales business, I thought, oh, I could figure this out. I could list the podcast, blah, blah, blah. I did a couple of coaching things.

They weren’t great. Finally got a good coach and it was to the moon. Like literally giving me, I think successful people are going to be successful.

I think a coach gets you there faster. Right? And the same thing with like your physical health and with investing in real estate, if I had gotten a coach, I probably would be, I don’t know, five times where I’m at right now, not regretting it because I made some really good connections along the way and I have great friends that I invest with.

And I really looking back on it, loved every way, everything that’s played out and I’m happy with where I’m at now. But if I had gotten a coach, maybe I’d be in a different space. And I don’t personally have the dreams of retiring and living off my rental income.

I think I’d probably go crazy if I had nothing to do. But I do like the idea of all of my expenses being completely covered and knowing I’m waking up today, not worrying about having my team sell 20 homes this month.

[Mattias]
That’s one of the underlying concepts of the book I’m writing. It’s like, if you’re able to kind of not level up your lifestyle and try to replace it with passive income, passive, you’re not passive. But that can really make you a lot more fearless, a lot more indestructible in this industry.

I mean, the market, talk to people all over the country and depending on who I’m talking to, where they’re at, like there’s some doom and gloom happening in the market, Florida, Arizona. There’s places where people are like, yeah, it’s vastly different when I talk to somebody else. And if your basis are covered, you’re going to be in the business longer.

So it just makes a ton of sense. I don’t know if you ever do this, but looking at kind of what the total amount of rent that comes in every month, it’s like this insane money. Obviously, it’s like going into debt service, but it’s kind of like this cool, like, whoa, that’s crazy.

Like I kind of control this much capital moving around. Or the amount of debt payoff you have every month is another by year. It’s another fun thing to look at from time to time.

Most, if you’re getting into commercial lending at all, you’re going to have to like provide a statement where you’re kind of adding up your net worth. And hands down, the real estate appreciation that’s happened for me over the years is where my net worth is. And if I was just in sales, like, I mean, it would not be half.

I don’t even know if it’d be a quarter of where it’s at.

[William Holder]
So- Yeah. It’s obvious once it starts to stack, right? And it’s really hard not to quit when it’s not stacked.

And that to me is the lesson that I try to impart on my agents, everyone that comes to me for investing. It’s like, listen, I can’t tell you this is going to be great. It probably isn’t.

You’re going to have some rough days. But if you stick with it and you continue along your path, you’re going to realize, you’re looking back and you’re like, how much equity do I have? Wait, what?

And now it starts to become fun because yeah, maybe you bought, like we have an 11 unit in the town that, hey, I don’t love owning a property in. So I had a property manager there for a while. And like I said, that didn’t work great.

But now I’m looking at the equity in that property after four years of ownership. Wait a minute, I can sell this 1031 it and put it into a building in the neighborhood I would want to be in. And now I don’t have to, and that was a BRRRR that has paid for itself over time.

And now I’m going to buy a building with found money. And that’s where it gets fun. Once you start playing monopoly, it gets fun.

[Mattias]
Yeah, exactly. You can do things like you said, 1031 into other investments. You can look at syndications.

I mean, you could, I guess, otherwise, but you could also triple net leases, for example, is another way where you can have a lot less headache in the day to day. So yeah, no, it’s definitely, you got to be able to delay gratification. You got to be able to kind of weather some storms.

But that kind of the more you do it, the more you get better at it. It’s kind of like a muscle you exercise. And yeah, it’s definitely worthwhile.

Even if things do correct and you lose some money for a little bit, like the values go down, like that illustration I said earlier with the 2000 buy, that went through the bubble burst and that property would have lost value. I’m not sure if it would have been under what they bought it for. I didn’t do the math for that, but they just had to ride it out for a couple of years and then they were back to where they were.

And now they’re from 116,000 to 350 with a tenant paying off the mortgage the whole time. I do want to switch over to your team though. I want to hear some more about your sales.

So five years ago, you started building this team. How big is it now?

[William Holder]
So we’re at 23 agents and we really ramped in the last four months. I used to be a broker owner for another franchise, which I don’t want to… I’m not sure how to describe it anyway.

But it was fine. It’s just after three years, I’m like, why does anybody want to be a broker? It just seemed like all of the worst parts of the business.

So we switched to a different model under Real and it gave me the opportunity to actually grow my team without all the expenses and worrying about the broker side. And there’s a lot of great things about that model that works for me, but our team has grown about eight agents just in the last four months. So we’re up to 23 agents and we’re really ramping now.

We’re in the knock on wood, but we’re in the snowball phase where any business, you’re profitable when you’re yourself, super profitable because you don’t have overhead. And then you hire an assistant and you jump up in profitability and you hire an agent or two and you’re like, okay, this is great. But then you start to scale and you have to hire more people, you have more expenses.

So your profitability dips. And that’s the truth about I think most businesses, but real estate teams especially, people aren’t willing to say is that in that four to 20 agent range, your profitability is significantly lower than if you were just an individual agent. I’ve done all the math.

And I tell people, before you start a team, make sure you want to do this. Because just like anything, there’s that dip where you’re covering the expenses from your own commission until it comes back up again. And we’re already up and it’s finally profitable and my agents are super happy.

And for me, in 2020, when I was finishing up all that, I was pretty, not to overshare, but pretty depressed about it all. And I felt like it was, what’s going to happen here? Why is this all worth it?

And that year, I made the most money I ever made ever. And I was still not super happy. And I’m like, well, if this isn’t going to make me happy, what is?

And I’ve found that, I used to get little dopamine hits from selling houses. That was really fun and great at the time, but it would wear off. What I found is that helping my agents crush has been my new life, joy.

And helping them invest. And I invest with some of them now and helping them build out their portfolios. So that’s my new thing.

I love what I do. I’m probably never going to stop selling real estate in some aspect. I don’t have any desire to quit my job or anything like that.

I just want to keep helping people win and it’s fun and I’m building a great life now. And I’m always going to make mistakes like anyone else. But I think not to give, is it okay if I mentioned another big podcast?

There’s a podcast called the Founders Podcast. Have you ever heard of that one? It’s a great podcast.

This guy reads about history’s greatest founders. And one of the things I’ve found after listening to it over and over again, is they all just did one thing and stuck to it for a long time. And that’s what’s been missing.

You see, everyone wants that instant Bitcoin money, or they’re all of a sudden a millionaire. And I’m good with knowing I’m going to be doing this for decades and I’m going to have a good life and I’m going to enjoy it along the way. And my kids are going to be happy and I don’t need to get there today.

And embracing that has actually sped up my success because I’m just happy you’re doing it. And that’s what I say to my agents. I’m like, this isn’t going to happen overnight, but if you’re really willing to commit to it, I’ll show you how to build a business.

I’ll show you how to start your own team. I’ll show you how to build a real estate investment portfolio. This is fun.

It’s fun. And changing people’s lives and perspectives, it’s great. It’s a good meaning for life.

And I’m never going to stop investing. I actually just ramped up my goal for next year. We talked to all my different…

I have small partnerships with friends. I don’t really syndicate or anything, not yet at least. And we all sat down, we talked, I’m like, Hey, I think 10 doors a month going forward should be the number.

And I think that’s what we’re going to shoot for next year. And then we’re trying to do 12 flips next year and stuff. So it’s snowballing.

It’s fun. It’s there. I’m glad I stuck with it.

And if you’re an investor out there and you’re dealing with that dip in profitability and the rough part, stick through it, man. It gets better. So one of our LLCs, we have seven buildings.

And it does well. And we burned those buildings. But when we did our most recent cash out refinance, they required us to put flood insurance on it, which is a killer.

So profitability dips significantly. And I’m like, man, this really sucks. I’m not loving these buildings anymore.

But then I just did some math. I’m like, well, hey, if I sell these and I take the equity and go buy a cheaper one building for cheaper, and I just do a forced depreciation on the building, I won’t have to eat too much of a boot from the 1031 exchange. And now I can have a super profitable building with a ton of equity that is less units under one roof, but I don’t have to deal with flood insurance anymore.

So there’s always creative ways to get out of properties if they’re not meeting your criteria anymore.

[Mattias]
And- Just have options if you’re in the game. Yeah.

[William Holder]
And every year you buy, or it’s every year you rebuy your own properties. You’re deciding if you want to own that property next year. So when you look at it, if it’s not a good deal anymore, it doesn’t work for you.

Property taxes went up, the flood insurance went up, whatever it is, the tenant aren’t paying great, sell it, buy something else, do something else with it. You said you were writing a book. What’s the name of the book?

[Mattias]
I’m not 100% sure. I haven’t fully decided yet. It’s the third round of editing.

So the launch team and stuff hasn’t started yet, but it’s going to be very similar to the title, probably the REI agent or something to that extent. But yeah, no, it’s based on your story basically. I think it’s getting through the grind at the beginning and trying to keep your expenses low, try to invest while you go.

I’m a big, big fan of doing the house hack to begin. If you can swing it with your personal life, I think it’s a great, great way to get started. And then, yeah, but I think it’s more geared towards the beginner phase.

So mentions things like team building and mentions things like syndications, but we’re not really focused on getting into more complex things. I think you really need to get started and not try to do advanced chess before you’ve even taken the first step.

[William Holder]
So yeah, no, that’s, I think if I had read some more books and things like that, I probably would. Looking back on it, house hack is the perfect way to start your investing career. And I completely agree with you.

If I tell every client I have that fits the criteria of a possible, they can live in a unit, rent out the others, or even just rent out some rooms. I tell them, try it, do it, man. Do an FHA three and a half percent down, and then go buy it.

You can buy a triplex or up to three units or up to four units with FHA. And then you get it, you can buy a duplex after that with a 5% conventional. You can get six units with eight and a half percent down.

And then you then go buy your home you want to live in. And all of a sudden you have six units and yeah, they might not be the most profitable because you have PMI and things of that nature, but they will gain equity. And you know, you live in everything.

[Mattias]
So our market doesn’t have a lot of multifamily. It’s harder to come by and it’s expensive. So we just bought a single family house.

It’s very similar to your story, honestly. We were mainly trying to pay off student loans. We had $120,000 and we were making like 70 or 1,000 together or something like that.

And we wanted to try to get that done as fast as possible to be able to start a family, not have that hanging over our head. Listened to Dave Ramsey, put our house on a 15 year mortgage. We started off with an FHA, refinanced it with a 15 year conventional, never rented out a room.

But then once my sales career got going, we saved up some money and bought another house and just turned that into a rental. Didn’t cashflow incredibly well, but now we owe like 30,000 on it or something. So if you look at it from a portfolio standpoint, if you’re looking at how much debt is being paid off, there’s a ton every month from that one.

And again, options, we could sell it, refinance it, we could do a lot of different things to kind of tap into that equity. It’s a great lever. Now we can pull whenever we want to.

[William Holder]
Yeah. I mean, you can go cash out, refine, buy two properties with the equity.

[Mattias]
Yeah. 100%.

[William Holder]
There you go. It’s awesome, man. I didn’t mean to start this whole thing off on too much doom and gloom.

I had a rough start to it, but where I’m at now, if you have the stomach for it, I don’t recommend any other path. I love what I do. I love selling real estate with my team, but I love investing in real estate.

I love looking at that and knowing if worse comes to worse, my wife and I were discussing potentially we might have to do like IVF for another kid or something. I could sell a house and just pay for it. When my kids are ready for college, I could sell a house and pay for it.

The likelihood of people putting away enough in a savings account every month for 18 years and not touching that is way less likely than you buying a house, having your tenants pay it off and sell it to send your kids to college.

[Mattias]
Yeah. A hundred percent. I think Brandon Turner talks about getting a duplex or something that just put on a 15 year or 20 year or something and just let the tenants pay it off for whenever they have a kid and then that is their college fund or it could be their first house or it could be whatever they need when they graduate.

I love it. William, you had a lot more real estate investing and knowledge than I expected coming to this podcast, which is awesome. Again, you’re perfect fit for the show.

I’d love to have you on again. I’m curious about if you have a golden nugget to share to our listeners.

[William Holder]
Golden nugget. I think I actually squeezed it in there. I think I tell all of our investor clients now is understanding, as much as I love BRRRR and it’s literally all I talk about, you have to get into flips too.

Don’t only try to do BRRRRs. You’re going to be using a lot of your own cash. You’re going to be constantly putting money into these things.

You’re not going to get them out for a while and it’s going to cause a strain on your life most likely. BRRRR, flip, BRRRR, flip. Everyone I talk to, I’m like, please adapt that cadence.

Unless you have a lot of money and you’re starting in real estate investing, which isn’t most people. Most people are starting with little money or none like I did and we did. You have to have cashflow for the business and your BRRRRs aren’t going to cashflow for a while.

They’re going to take some of your money at the end. I really do think if you’re doing this and your dream is to own passive income, which like you said, rental properties are not passive income, but then have income for your business. And that to me with a real estate investment portfolio is flips.

[Mattias]
Yeah. I love it. Now, I know you said earlier that you’re not a big reader, but do you have one that you think is fundamental?

It’s okay if it’s rich dad, poor dad. That book has changed so many people’s lives. I swear it’s one that is a fundamental one that gets mentioned so often.

I love it. I mean, it’s for good reason. But yeah, do you have a book that either you’re fundamental or one that you currently have appreciated?

[William Holder]
So I joke a lot because my wife jokes me about reading, but I do read. I’ll pick up a book and read it. But Rich Dad, Poor Dad is big.

I’ve read all of the Bigger Pockets books and all of those. I’ve read The Richest Man in Babylon. Literally every book that’s been recommended through any podcast I listen to, I enjoy, even if it’s listening to it, but I do try to read a good amount of them.

They all give you different lessons. And I’m looking at my playlist right now. I mean, The Conversion Code, Atomic Habits, Tribe, The Communication Book.

Traction taught me how to build a business and I implement that into every… I put it into my team, I put it into my real estate. Run your real estate investment business like a business.

So we have weekly meetings and monthly meetings and quarterly meetings, and we have roles. And if you understand how to run a business, you can implement that on everything. Traction’s a really good one.

I’ve read a lot. I was kind of kidding earlier, but you have to. It’s been between failing and reading, I’ve gotten my education.

[Mattias]
I love it. I love it. It’s been a great conversation, William.

If people want to follow you on social media or maybe they’re in your area and want to reach out, where’s best way to find you?

[William Holder]
Yeah. Instagram, @TheWilliamHolderRealtyTeam, or you can reach out to our website, WilliamHolderRealty.com or my phone, 484-744-4053, or email me, Will@WilliamHolderRealty.com. I’m easily found and I’d love to help.

Feel free to reach out for anything, even if it’s just a conversation about investing in real estate. Those are my favorite conversations. Get that joy.

[Mattias]
It’s been a great conversation, William. I really, really appreciate it. Have a great rest of your day.

Absolutely, man. Appreciate it.

[Erica]
Thanks for listening to the REI Agent.

[Mattias]
If you enjoyed this episode, hit subscribe to catch new shows every week.

[Erica]
Visit REIAgent.com for more content.

[Mattias]
Until next time, keep building the life you want.

[Erica]
All content in this show is not investment advice or mental health therapy. It is intended for entertainment purposes only.