Key Takeaways
- Residential assisted living can turn a growing senior care need into an opportunity to build wealth while providing families with a more personal care option.
- Owners can create greater freedom by building strong systems, hiring capable administrators and caregivers, and remaining focused on working on the business instead of inside it.
- Bigger opportunities do not require investors to climb an imaginary ladder first, but they do require education, disciplined numbers, sufficient capitalization, and the courage to think bigger.
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When a Family Crisis Reveals an Opportunity to Change Lives with Residential Assisted Living
Sometimes the most powerful opportunities do not begin with a spreadsheet, a business plan, or a perfectly timed investment. Sometimes they begin with a family facing a problem that simply cannot be ignored.
For Isabelle Guarino and her family, that moment arrived when her grandmother fell, broke her hip, and suddenly needed 24-hour care. The choices facing the family were painfully familiar.
Someone could leave work to become a full-time caregiver. They could pay for expensive in-home care. Or they could move their loved one into a traditional facility.
None of those options felt right.
Isabelle’s father had spent years investing in properties, so instead of accepting the choices in front of him, he started searching for another answer.
That search introduced the family to residential assisted living and ultimately changed the direction of their lives.
“I’m not going to pay five, six grand a month for her to live in one of these when we could own it, she can live for free and we can cashflow 10 grand a month.”
What began as a deeply personal need became an entirely different way of thinking about housing, care, investing, and family legacy.
The Opportunity Hidden Inside an Ordinary House
Residential Assisted Living Changes the Picture
The concept sounds surprisingly simple. A residential assisted living home is typically a single-family residence serving a relatively small number of seniors in a residential environment while providing the care they need.
Instead of hundreds of residents navigating the halls of a massive facility, residential assisted living can create something smaller, more personal, and more familiar.
For an investor, however, Isabelle makes it clear that this is not simply a matter of buying a house and putting seniors inside it. It is a legitimate operating business with staffing, licensing, management, marketing, financial planning, and very specific property requirements.
That distinction matters because the opportunity extends beyond owning the property. The business operating inside that property can become another source of value.
There Is More Than One Door Into the Business
Isabelle explains that investors generally have several different ways to enter residential assisted living.
They can lease a property that has already been prepared for this type of operation. They can purchase an existing assisted living home and its operating business. They can convert a traditional single-family residence. Or they can purchase land and build a property specifically for assisted living.
Each path comes with different levels of capital, construction experience, risk, and operational complexity.
For someone who has never completed a major renovation or ground-up development, buying or leasing an existing operation may feel far more approachable. Someone comfortable with construction may see greater possibilities in converting or building a property.
There is no single path that works for everyone. The important lesson is that investors do not need to force themselves into one strategy simply because that is how someone else entered the industry.
The House Is Important, but the Market Comes First
Demographics Can Make or Break the Investment
One of Isabelle’s strongest lessons has little to do with countertops, bedrooms, bathrooms, or architectural style.
The surrounding demographics matter enormously.
She explains that the ideal market generally includes an older, more affluent population with homeowners and college graduates. Interestingly, the target demographic is not simply the senior who may eventually live inside the home.
The adult children frequently influence where their parents receive care.
That means convenience becomes incredibly important. Families often want their loved ones close enough to visit without turning every visit into a major trip across town.
A beautiful assisted living home in the wrong market can therefore struggle, while a well-positioned property in the right demographic area can have a much stronger foundation.
Designing the Property Around the Resident
Once the market makes sense, the physical property comes into focus.
Isabelle looks for large floor plans, generous square footage, multiple bedrooms, and enough bathrooms to comfortably support residents. Renovation is often part of the process, so a property that already offers substantial space can make the conversion easier.
Privacy is another major consideration.
Although regulations may allow shared bedrooms in some situations, Isabelle has found that private-pay residents often prefer private rooms and a more upscale residential experience.
The lesson is straightforward. The property should not merely satisfy regulations. It should be somewhere a family genuinely feels good about choosing for someone they love.
The Owner Does Not Have to Become the Caregiver
Owning the Business Is Different From Working Every Shift
One misconception can stop investors before they even explore this opportunity. They imagine that owning an assisted living business means personally cooking meals, cleaning rooms, providing care, and living at the property.
Isabelle says that does not have to be the model.
The investor can remain in the owner’s role while trained caregivers and administrators handle the daily operations.
The owner focuses on the same responsibilities that owners of other businesses should focus on. That includes reviewing financial performance, monitoring key performance indicators, meeting with leadership, evaluating marketing, and making strategic decisions.
Isabelle says her own homes are approximately 45 minutes from where she lives and that her physical visits can be extremely limited. Much of her involvement happens through virtual meetings with the administrator overseeing operations.
Build the Business Around the Life You Want
This philosophy reaches far beyond assisted living.
Isabelle challenges the belief that owning a business automatically means being trapped inside that business every day.
“If you own a business, you have to work in it. You have to be hands-on. And I’m kind of out here being like, no, you don’t.”
She has seen students own homes in multiple states while maintaining the freedom to live elsewhere and structure their lives differently.
“You do not have to be hands-on. You get to do whatever you want in every single business.”
The freedom, however, does not appear by accident.
It is created through systems.
“If you build it around you, guess what? It’s around you, baby.”
That may be one of the most valuable ideas in the entire conversation. Entrepreneurs frequently build businesses that eventually control them. Isabelle encourages investors to decide deliberately what role they want to play and then build the systems, team, and leadership structure that support that role.
The Numbers Have to Work Before the Dream Can Work
Undercapitalization Can Destroy a Great Opportunity
Residential assisted living can produce compelling numbers, but Isabelle repeatedly warns against allowing excitement to replace financial discipline.
One of the biggest mistakes she sees is undercapitalization.
An investor may need money for the property, renovations, carrying costs, furniture, fixtures, equipment, operational expenses, and personal income during the period before the business reaches sustainable cash flow.
If those needs are underestimated, the investor can find themselves returning to lenders or partners asking for additional money halfway through the project.
That can damage confidence in both the project and the person running it.
Do Not Fall in Love With the Property
This is where Isabelle delivers one of the simplest and most important investment lessons of the episode.
“It is not emotional. It is a literal numbers decision.”
“If the math is math and great, if it is not run away.”
Investors can fall in love with a house, a neighborhood, a renovation concept, or the story they have created about what a project could become.
But enthusiasm cannot rescue bad numbers.
Successful investors need enough discipline to walk away when the financial assumptions do not support the opportunity.
Isabelle would rather build more time and money into the plan and finish ahead of expectations than begin with unrealistic projections and spend the rest of the project trying to recover.
A Business Born From Family Becomes a Family Legacy
From One Home to Investments Across the Country
The family’s original assisted living home was purchased with the intention of moving Isabelle’s grandmother into it. Sadly, her grandmother passed away before that could happen.
But the experience had already changed the family’s direction.
Isabelle joined her father in the business, and they continued building from there. What began with one family problem grew into additional properties, investments across the country, educational programs, an industry association, a conference, books, and a podcast devoted to assisted living.
Her father passed away in 2021, making the idea of legacy even more meaningful.
Because the businesses and systems had been built properly, Isabelle was able to continue what the family had created even though his passing was sudden.
That experience gives the word wealth a much deeper meaning.
Wealth is not simply the amount of money generated by an investment. It can also mean creating something strong enough to survive beyond the person who originally built it.
The Opportunity Can Become Much Bigger Than One Property
Investors Can Build for Cash Flow or Build for Scale
Residential assisted living does not have to become a massive portfolio.
Some investors may simply want one or two homes that create strong cash flow, provide ownership of valuable property, and potentially offer a future care solution for their own family members.
Others may see something dramatically larger.
Isabelle shares the example of a student working toward a portfolio of 100 homes with the goal of eventually packaging the operation for a large institutional buyer.
She also speaks with family offices interested in the space, but those buyers may prefer portfolios of dozens of homes rather than individual properties.
That creates multiple possible end games.
An investor can build a small portfolio designed for income and long-term ownership, or build toward enough scale to eventually create a substantial acquisition opportunity.
America Is Running Toward a Senior Housing Problem
Demand Is Growing Faster Than the Available Supply
Behind the investment opportunity is something much more serious.
America is aging.
Isabelle describes an enormous population of seniors moving toward an age where care and assistance will become increasingly necessary. At the same time, the country faces shortages in available beds, qualified caregivers, and the capital required to build enough new capacity.
“This is going to be a mega crisis in our country, not only because there’s not enough beds, but there’s not enough staff and there’s not enough money to even fix this.”
Basic economics then becomes difficult to ignore.
If demand continues rising while supply remains constrained, the cost of care can continue climbing.
“When the supply is low and the demand is off the chart, the price, the cost of care just goes tick, tick, tick, tick, tick.”
Isabelle says the cost of care has already risen dramatically over the past two decades and expects affordability to become an even greater concern as demand accelerates.
That makes residential assisted living more than an investment discussion. It is also a conversation about how families will care for aging parents, spouses, relatives, and eventually themselves.
The Beginner Does Not Have to Start Small
Stop Assuming Success Has Prerequisites
One of Isabelle’s most inspirational messages comes near the end of the conversation.
New investors often assume there is a mandatory ladder they must climb. They think they need to begin with smaller transactions, master several strategies, spend years gaining experience, and only then earn the right to pursue larger opportunities.
Isabelle rejects that thinking.
“Why jump right to the top?”
The extra zeros can feel intimidating, but intimidation does not automatically mean the opportunity is beyond someone’s ability.
“Do not let your brain stop you from your success.”
“Do not feel like you need to work your way up.”
That does not mean jumping blindly into an unfamiliar industry. Isabelle strongly emphasizes education, preparation, proper capitalization, and understanding the numbers.
But preparation and fear are not the same thing.
There is a powerful difference between learning because an opportunity deserves serious preparation and delaying because someone has convinced themselves they are not yet worthy of pursuing it.
Success Gets Easier When Everything Does Not Depend on You
Finding the Right Who Instead of Asking How
Isabelle points listeners toward the book Who Not How, a message that closely matches the way she approaches business ownership.
Entrepreneurs often ask themselves how they are going to accomplish every task. How will they manage the employees? How will they handle marketing? How will they oversee operations? How will they solve every problem?
A better question may be who can help accomplish those things.
That shift allows an owner to stop becoming the answer to every problem inside the company.
“As soon as you can really break free from that, you can really change your life.”
That idea connects almost everything Isabelle discusses throughout the episode. Find the right property. Understand the right numbers. Hire the right caregivers. Empower the right administrator. Build the right systems. Surround the opportunity with the right people.
Then let the business become bigger than one person’s available hours.
The Bigger Opportunity Is Building a Life With Choices
Wealth Becomes Powerful When It Serves Something Greater
Isabelle Guarino’s story begins with a grandmother who needed care, a family searching for a better answer, and a father willing to look at the problem differently.
What followed became a business, an investment strategy, an educational mission, and a family legacy.
But the deeper lesson reaches far beyond residential assisted living.
A challenge can become an opportunity when someone is willing to question the choices everyone else accepts. A business can create freedom when it is intentionally designed around systems rather than constant owner involvement. An investor can pursue bigger opportunities when education replaces fear. And financial success can become far more meaningful when it also solves a genuine human problem.
“Find an opportunity that calls to you, that you’re excited about, that interests you and go for it, go get educated and go for it.”
That may be the real invitation behind Isabelle’s story.
Think bigger. Learn deeply. Respect the numbers. Build intentionally. And never assume that the opportunity capable of changing a family’s life has to look like the opportunities everyone else is already chasing.
Stay tuned for more inspiring stories on The REI Agent podcast, your go-to source for insights, inspiration, and strategies from top agents and investors who are living their best lives through real estate.
For more content and episodes, visit reiagent.com.
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Mentioned References
Transcript
[Mattias]
Welcome back to the RAI Agent. My guest today is Isabellele Guarino, CEO of the Residential Assisted Living Academy and one of the most recognized voices in a niche that most real estate investors have never seriously considered. Isabelle carries on the legacy of her father, Gene Guarino, who pioneered the concept of doing good and doing well in the senior housing space.
She is a two-time bestselling author and has been named a top influencer in senior housing. With America’s aging population creating one of the most durable long-term demand stories in real estate, Isabelle makes the case that residential assisted living is not just a feel-good investment, it’s genuinely a compelling asset class. Isabelle, welcome to the RAI Agent podcast.
[Isabelle Guarino]
Thanks for having me on the show. Excited to be here.
[Mattias]
Yeah, I mentioned this a little bit early before we got on here that this is a really interesting topic because I think that with interest rates being higher, a lot of people are having to consider other things than just the straightforward long-term rentals to make ends meet. I’ve had a lot of fun talking to various people, sober living communities, like a rent by the room kind of thing, all sorts of different ways people are making things work. I think talking to the sober living community person, it was clear that it worked better financially for him to do this, but there was also a deep passion behind it, and it was really serving the people that was probably the most rewarding part of it.
I think that there’s probably a lot of overlap here. Tell us a little bit about how you got started. This obviously has been a family thing, but yeah, tell us a little kind of the origin story and kind of how you got started in this space.
[Isabelle Guarino]
Yeah, my father had been a real estate investor pretty much my whole life, doing everything from fix and flip wholesale, multifamily, everything. And when my grandmother fell and broke her hip and the doctor called and said, hey, she can’t go home alone. She needs 24-7 care.
We kind of faced the situation that many people do where it’s like, what do you mean? One of us has to quit our job and go take care of her full time, or we get in-home care, which is insanely expensive, or we put her into a facility and it just felt like these options are not good enough. And so because my dad had that background in real estate, he started looking for alternative solutions and he kind of stumbled into residential assisted living.
So a single family home, six to 16 seniors in a residential environment, but you’re getting the same care and probably better care than in a larger facility. And so he purchased his first existing one with the intent to move my grandmother in because he’s like, whoa, whoa, whoa, whoa, I’m not going to pay five, six grand a month for her to live in one of these when we could own it. She can live for free and we can cashflow 10 grand a month.
So it really kind of started as a personal need. And then my father just having that financial foresight to understand that this is either going to cost us or we can be in control of the situation. And it really just bloomed like crazy from there.
[Mattias]
I like your dad. That’s a classic entrepreneur, real estate investor, the way to look at it.
[Isabelle Guarino]
Yep. Whenever there’s a problem, there’s a solution where we can make money.
[Mattias]
It’s like house hacking, but for your mom. Yeah, no, that’s great. And it is true.
It’s a huge demand. Obviously we’re getting the baby boomers in needing more and more facilities to house them. So it’s a huge need.
Walk us through kind of what a good property that would be. You’re not building these new. Are you converting existing structures or what does that look like?
[Isabelle Guarino]
There’s kind of four ways to get started because now I’m in this space, but also for the last 13 years, we’ve been teaching other people how to do it. So I’ve learned a lot along the way, but you can lease a home to use for this. You can buy an existing residential assisted living.
So buying the real estate, buying the business you’re up and running cash flowing day one, you can convert a single family or you can buy land in custom build. But if you are converting the single family, I know you’re asking like, what are you really looking for? The major thing you’re looking for is the surrounding demographics that will make or break one of these deals.
So we need to be in an area where the majority population is 50 years old and older, making two times the median income homeowners and college grads. And that is not the senior moving in that is their adult child. And we need to be in that affluent and older area because they don’t want to drive 45 minutes outside of town because it’s cheaper.
They want to drive five minutes on their way home from work. So you really need to be in their area. And then logistically, it’s just a large floor plan, as much square footage as you can.
A lot of bedrooms and bathrooms, you’re going to be doing a renovation anyways to add more, but the easier it is that you don’t have to do as much. So like 300 to 500 square feet per resident is a good rule of thumb.
[Mattias]
Okay. Okay. That’s good to know.
And typically, are you seeing people? I think I’ve heard maybe other shared rooms. And then there’s also like is it both or what does it typically look like for how many people can be in a five bedroom house or whatever?
[Isabelle Guarino]
Yeah. So typically these seniors who are in private pay residential assisted living, they don’t want to share. They want a luxury upscale home.
So you’re going to take that maybe six bed, five bath and convert it to be a 10, 10. Bathrooms are okay to share. They don’t all need their own bathrooms, but even if you converted it to a 10, five, still you are doing some renovation to a property to get it where you want it to be.
So even though the state allows you to share and you will find these homes with shared bedrooms, you’re going to get a lot lower rates. And it’s just more work for you to really market and sell that bed because people do not want to share at this point in life.
[Mattias]
That makes sense. I don’t blame them. Let’s go back to college.
[Isabelle Guarino]
And when we’re older, we do not like sharing and in the middle, we might not like it either, but we just zip our lips about it.
[Mattias]
Yeah. Yeah. Now what about stairs?
I mean, like, is that something that I would imagine most large homes are going to have stairs?
[Isabelle Guarino]
Yeah. If there are stairs, you’re going to need to add in a residential elevator, which might run you anywhere from 50 to 150. Right.
But it’s a one time investment that maybe opens up an entire second level that now is going to bring you in a whole lot more income. So it can be worth it if the property, you know, if you cannot find any ranch style homes in your market. But I have never been into a market where there’s not one ranch style home.
There’s definitely always one around.
[Mattias]
Yeah. Yeah, for sure. It’s just the ones that are large enough to really accommodate.
That’s seems like a pretty, pretty large ranch. Right. I mean, and most of them would have basements to then.
Right. I mean, so depends on your market.
[Isabelle Guarino]
You know, we teach this in all 50 states. So I have students everywhere. Some do, some don’t.
It just really depends on your market. But if you’re taking that large luxury home, you’re doing that renovation anyways to really make it what you want. So we’re never going to find traditionally a 1010 on the market, but you can always find something that’s 6500 square feet and convert it to be whatever you want it to be.
[Mattias]
Yeah. OK. Yeah, that makes sense.
Yeah. So what do you find a lot of? Is it pretty even as far as when people are wanting to get started in the space as to how they start, which direction of the four that you mentioned, or is that kind of depend like do you see people gravitate towards more one more than the other?
[Isabelle Guarino]
There’s a lot of it depends on that. If you’re going to buy an existing care home, right, there’s markets that have a lot more than others. For example, here in Arizona, where I am, there’s 3000 group homes in the one county I’m sitting in.
So there’s plenty for sale. I could probably find you five listings in the next 10 minutes if you wanted to, versus you go to, you know, New Hampshire, there’s three of these in the entire state. So it’s going to be a lot harder to find an existing one for sale.
So that one is kind of market specific when it comes to leasing a home for this, right? Someone else bought the property, renovated it for assisted living, and they’re leasing it to you. Who’s going to run this in the home?
That’s really where people kind of enter who say, I don’t have money and I don’t have the real estate know how to buy and reno. So I really want someone who kind of fills in that blank for me. Now, when it comes to converting a single family or custom building, that’s really just on your comfortability with renovations.
Some people have never done a ground up custom building that freaks them out. And so they’re like, no way I can, you know, add bedrooms and bathrooms to something that exists, but doing a full build, that’s a lot. So it’s really kind of personal preference, market preference, and then your financial preference.
[Mattias]
I could see too, you know, there being people that like, I could see myself, for example, if I had a large home, I was like, what am I going to do with this thing? Like, maybe I found one that to flip. And I could almost see, okay, well, what if I do the renovations for this and offer it to lease to somebody who wants to run the business?
I don’t know if I really want to do the business. That’s kind of like maybe another even angle here, right?
[Isabelle Guarino]
Absolutely.
[Mattias]
Yeah. I mean, walk us through a little bit of the operating the business side here, because it certainly isn’t the same as having a long-term tenant, traditional rental.
[Isabelle Guarino]
Yeah. On the operation side. So you, the real estate investor, owner, operator of the business, you’re not living in the home, working in the home, being a caregiver, you’re not a doctor or a nurse, none of that, right?
You literally own this business. And so what do other business owners do? Well, they do weekly meetings with their teams to make sure that things are afloat.
They’re checking in on KPIs and marketing efforts. They’re making sure that the PNLs look right. That’s exactly what you’re doing in this space.
So how we show people to enter into this is to create that business, hire the staff, create your policies and procedures and your KPIs, and then really run and manage it as a true business. So my homes are about 45 minutes from where I live here. I visit them maybe twice a year, and I spend about five hours a week virtually on Zoom with my administrator, really running the business.
And so that’s what we show people how to do. Now, just because the owner’s hands-off doesn’t mean it’s a hands-off business. It’s a very hands-on business, but that’s what the licensed caregivers are doing with the seniors, cooking, cleaning, caregiving, and laundry service.
The licensed administrator in the real estate world, it’s kind of like our PM or property manager. They run all of the hiring, firing, training, onboarding of your staff, as well as your marketing to fill those beds with the seniors. So they’re doing kind of all of the day-to-day op so that you can kind of stay in that owner’s box, working on, not in the business.
[Mattias]
Yeah, I like that. That’s really interesting. I mean, so that’s definitely not the way you’ve run it.
And I would imagine there are some people that are going to be maybe a little bit more involved. Do you have an administrator that runs all of them kind of for you that you meet with? Is that- Yeah.
[Isabelle Guarino]
And most people, you are correct, 80% of this industry is hands-on. We are kind of the new age, the new wave of people saying, you don’t have to do that. There’s another way.
I promise it’s better and it’s different. And people kind of hate me in our industry for that because for a long time, they’ve been saying that’s impossible. That’s impossible.
If you own a business, you have to work in it. You have to be hands-on. And I’m kind of out here being like, no, you don’t.
I’m doing it and thousands of my students are literally living in other states. I’ve got students who live in RVs and have homes in six different states. You do not have to be hands-on.
You get to do whatever you want in every single business. If you build it around you, guess what? It’s around you, baby.
But if you don’t want to be in the day-to-day, then you just build systems and follow the systems. That’s it. It’s just like everything else.
[Mattias]
Yeah. I love that. I think one of the ideas that concepts that I write about in my book and talk about on the show is Robert Kiyosaki.
I think he might’ve been the one that created it, but he at least talks about the cashflow quadrant. So you’ve got being employed, you’ve got going into the self-employed world. So agents getting into that self-employed world is often a huge, huge thing.
It’s really difficult to break out and feel like you’re just completely self-reliant and that can be a big challenge. But I’m encouraging us to also start working on the investment side of things and the business-owning side of things, which is on the right side of the quadrant. And when you’re investing, you’re leveraging money.
You’re leveraging money to create more money. And obviously we understand that in stocks and that kind of stuff and real estate. But in the business world, you’re leveraging other people.
And I think that this is kind of a cool, unique way of checking both those boxes in real estate. And that’s where you can really truly start carving out that freedom that a lot of people want to feel, that financial freedom. And that’s awesome that it’s possible in this business.
[Isabelle Guarino]
Absolutely. Truly, truly it is.
[Mattias]
Yeah. So what would be some things that somebody considering this type of investment should really know? I mean, is there like a, don’t do this unless you understand this?
Is there anything like that?
[Isabelle Guarino]
Yeah. I mean, there’s a reason why we teach and educate in this space. It’s because there’s a lot to learn before you get in.
It’s definitely not something that’s like, let me just take a whack at it. Like, no, you really should learn everything, single thing you need before you get started. But I will say one of the biggest mistakes people make upfront in this business and any business is under capitalization.
So for us, you know, you’re going to need the money for the real estate, the renovation, the carrying costs, cause you’re not cash flowing day one, your furniture fixtures and equipment, and you need to get paid throughout this entire project. You can’t just go no paycheck the entire time. So an SBA loan seven, a or five Oh four will cover that entire cost.
And so that’s a beautiful way to get started, but you really need to know and understand how to run those numbers and make sure that you don’t have to go back to your lenders or your investors to say, whoops, I miscalculated and I need more. That’s like the kiss of death in any, you know, investing opportunity. So you have to, have to, have to really understand the numbers.
You know, a lot of investments, people try to make it an emotional decision, fall in love with the house. They fall in love with an idea. It is not emotional.
It is a literal numbers decision. If the math is math and great, if it is not run away, like it has to be about the math, that’s it. Right.
So under capitalization upfront is one of the biggest mistakes that people make in this industry by far.
[Mattias]
Yeah. I would imagine that there, especially with renovations and new construction, there would be also a lot of, it’s going to take longer than you expect or longer than they say it’s going to take right.
[Isabelle Guarino]
Always twice the price and twice as long. You never know. So it’s better to just bake it in and go back to your investors or lender and be like, look, I can pay you back earlier.
I can pay you back more than we projected than to ever have to go back and have to ask for more.
[Mattias]
Yeah. Yeah. Totally.
That makes sense. Yeah. So when, when did you purchase your first one?
I know that it’s been a family business, but like, did you break away from your dad doing it and buy one on your own or what would that look like?
[Isabelle Guarino]
So that first one was with the intent to move my grandmother in. She passed before we could move her in, but we kind of fell in love with this industry. And I started working with my dad right after that.
It was, I was out of college. I had a couple of jobs, but he really needed support. So I came by his side.
We then purchased two more that we renovated to become RALs. And now we’ve invested in over 47 across the country. My father passed in 2021.
And we had started this business probably 2013 ish. So it’s been a minute, but in 2021, when he passed, I kind of took over all those businesses as well as, you know, our, we, we run the nation’s largest association on this entire topic, the nation’s one and only conference on this topic. We have our academy, uh, you know, I’ve written books on it.
I host the number one assisted living podcast in the nation. So we’ve kind of really blown it up over the years. So I have those three, we’ve got all these investments and then we’ve taught thousands of people how to do this over the years, but it’s always stayed a core family business because that’s what it’s about at the end of the day.
It is about that family legacy and being able to pass this from generation to generation, which is unheard of in a lot of other family businesses. So I’m really proud that we’ve been able to have that transition, um, with, with little to no handoff, you know, he passed suddenly. So there was no conversation about what happens, you know, who gets this, who gets that, but everything transitioned seamlessly.
Praise God.
[Mattias]
Yeah. Well, sorry to hear about the losses. Um, but that is a beautiful like family legacy that I think, you know, people aspire to have for sure.
Um, what, what, what does it look like to, to sell? I mean, you mentioned that you could find, you know, five in your area pretty easily. Um, what does it look like to sell this typically?
And then, cause I mean, I think part of the investment thing is, you know, we’re building up equity. How do we value this? Is it valued like, um, you know, a commercial thing would be with cap rates or is it, um, you know, yeah.
So tell us a little bit about that.
[Isabelle Guarino]
Yeah. You do have to be a commercial agent to buy and sell these basically, but we actually have a course on that showing agents how to buy and sell these because it is a huge opportunity for them to 10 X their cashflow. So the business is valued as two to five times the EBITDA, the earnings before taxes, depreciation, and amortization, and the real estate’s worth what it’s worth, right?
You’ve done renovations to it. It’s going to look a little different, but it will never be sold as a single family. Again, it will always be sold as hopefully an existing residential assisted living worst case as a home.
That’s going to be used for some form of group housing. If the person ran the business to the ground, then the business has no value, but that home would be kind of marketed as a group housing opportunity. So yeah, but that business side is where really the cashflow starts to come in for the agents because this isn’t just, you know, a $2 million home.
It’s a $2 million home plus the business and they get to sell it kind of packaged together. And so that’s where that opportunity for income really grows for a lot of agents right now.
[Mattias]
Yeah. And it’s also kind of, you know, you have two ways of appreciating your asset if you’re the owner, right? I mean, so you can, you know, obviously the real estate over time will go up in value, historically it has at least.
And then you have the business. So like if you’re operating the business, you know, like well, then you’re going to see better results from it. I would imagine then as well, like if somebody was interested in buying multiple, I know that in various businesses, like if you achieve X amount of business a year, like you’re the amount that your business is worth multiplies at different rates.
Like if somebody were to buy, you know, multiple of these and want to sell them as like a package that that could possibly be a thing that they could work towards as well. Right?
[Isabelle Guarino]
Yes. Yes. And it definitely brings in a whole lot more income.
We have a student who got started with us, I think in 2019 and they’re on home number 26. Their goal is to have a hundred package it up and sell it to the hedge funds. And I often am speaking with family offices who, you know, they would love to get investing in this space, but onesie twosie is just not enough.
They do want to see the packs of 50, the packs of a hundred where they can just boom, make that large, you lots of ways to kind of do this, whether you want to build up a portfolio and have a huge sellout, or maybe you just want to have one or two of these to cashflow well for you, hold the real estate and have a place for your own loved one. If they ever need care and assistance. I mean, reality is we’re all getting older or we know someone who is right.
And you know, we’re all going to need care and assistance, at least 70% of us. Well, so if the odds are that 70% of your mom, your dad, you know, your partner’s mom, partner’s dad, you, your partner are going to need this. Probably one of you, at least if not more of you are going to need this and you’re either paying for it or you could own the place where they could go for free.
So to me, I’m like, everyone should have one in their portfolio, no matter what. But if you really want to go crazy, there’s a lot of opportunity down that path as well.
[Mattias]
Yeah. Yeah. That’s interesting.
You’re getting my brain, my brain turning. Yeah. I mean, like it’s, it’s true.
Like, I mean, I think, you know, we all, and it’s also, I would imagine there’s not, it’s not just elderly. Right. I mean, there’s other people that need to have, like, if there’s like a paralyzed accident, like there could be younger people that would need assisted living as well.
Right. Is that also in this umbrella?
[Isabelle Guarino]
Yeah. So group housing is the umbrella. And then there’s probably 500 types of group housing.
Like you mentioned in the beginning, clean and sober pads, shared living. A lot of times there’s like, you know, when people come out of prison, they need somewhere to go battered women, foster kids who’ve aged out of the system. I mean, there’s a million ways Parkinson’s disease rehab center.
I mean, there’s so many, we focus on one thing and one thing only senior housing, residential assisted living, because the numbers are so in our favor, not that they’re not in all these other categories. They definitely are, but you know, we’re currently 1.3 million beds short and we’ve got 76 million seniors coming into this market. The wave kind of hits the shore of the silver tsunami hits the shore in the next four years.
So there’s not enough money in the world to be able to build these beds fast enough for this coming need. This is going to be a mega crisis in our country, not only because there’s not enough beds, but there’s not enough staff and there’s not enough money to even fix this. So what’s going to happen?
Well, when the supply is low and the demand is off the chart, the price, the cost of care just goes tick, tick, tick, tick, tick. It’s already gone up over 84% over the last 20 years. And it’s projected to just skyrocket over these next 20 years.
So it’s going to become whoever can pay can stay and everyone else is going to have to figure out another solution because caregivers is going to be one of the hottest things that people are looking for, wanting the best of the best. And let’s be real. Young Americans are not thrilled about becoming caregivers to elderly people.
And right now, 80% of the industry of caregivers are immigrants from other countries. And you know, everyone can believe whatever they want to believe politically. That’s not, I’m not here to argue anything, but if we don’t have that funnel coming in legally, of course, but we need that funnel coming in to help us with this mega problem that we have.
And so there’s really kind of a lot of economic things that play in this industry that make it a really fun one to watch. And also a fun one for me to be positioned for, because I’m in that perfect position where it’s got the brand, got the reputation, I’m ready to go. Now, people who want to get in in 15 years, you’re going to be one in a million.
Everyone and their mom’s going to want to get in. Right now, we’re kind of one of the only people talking about this, bringing it out, but I’m pretty sure you’ll have lots of guests talking about this in the future.
[Mattias]
Yeah. I mean, like you just outlined again, why you said everybody should have one. Like if you have parents and that kind of thing that need to have care in the future, yeah, it’s going to be more and more challenging.
That’s a really good point. What other golden nuggets do you have for our listeners today?
[Isabelle Guarino]
You know, I would say that if you’re listening and you are new to real estate investing, don’t feel like, oh, I need to start at the bottom. I need to learn fix and flip. I need to learn wholesale and then this, and then that, and then I can get to these bigger, better cash opportunities.
Why? Jump right to the top. There’s people who will teach you right at the top what to do, how to get involved.
It’s just a couple extra zeros. There’s literally no difference between you and everyone else who I teach how to do this opportunity. Do not let your brain stop you from your success.
Do not feel like you need to work your way up. No, no, no. Find an opportunity that calls to you, that you’re excited about, that interests you and go for it.
Go get educated and go for it.
[Mattias]
I love it. I love it. Now, what about a favorite book?
Anything that’s fundamental that everybody should read or just one that you’re currently enjoying?
[Isabelle Guarino]
You know, there’s so many amazing books. I look to the sides of me because that’s where my bookshelves are. But the one that I’m really liking right now is Who Not How.
I’m sure you’ve read that one. So great. And especially for agents listening, because a lot of times we do think it falls on us.
We think it falls on, you know, we have to make it happen. And it’s like, nope. As soon as you can really break free from that, you can really change your life.
And so I recommend everybody reads Who Not How.
[Mattias]
Absolutely. Yeah. I mean, it’s talking about that like in a business quadrant as well, right?
I mean, like that’s a classic. So absolutely. And then you wrote a book, right?
What’s that? And how can people find you on websites and social media?
[Isabelle Guarino]
Yeah, a couple books, but my newest one is Assisted Living Revolution. It’s kind of like a chicken soup for the soul fiction book about assisted living and families who are going through those situations and kind of the choices that they make and what happens to them when a loved one needs assisted living. It’s a really great book based on the thousands of stories that I’ve heard over the years of people going through this exact situation.
So Assisted Living Revolution, that book and so many other resources are available at ral101.com. You can schedule a call with me or my team. There’s webinars, books, all sorts of stuff.
So, ral101.com. And you can follow us on social media @ralacademy on any platform that you like.
[Mattias]
Awesome. Well, thank you so much for being on the podcast. It was a lot of fun talking to you and it’s really eye opening.
And I think you’re right. I think we’ll be hearing much more about this industry.
[Isabelle Guarino]
Thanks for having me.
