Transcription
What's cracking YouTube? Jamil here, and I have something incredible to share with you today. There is a strategy that I have been doing for the last year and a half that is, in my opinion, the Holy Grail of real estate strategies.
Now, why I think it's so dope: you guys know me as the nation's number one wholesaler. Well, one of the things about wholesaling that is difficult for people is the fact that it can be inconsistent, right? When you are a wholesaler, you never really know where your next kill is going to come from. And so, it takes a long time to build some consistency up. And unless you're spending a ton of money on marketing or you have a big team like I do, creating consistency can be a real problem for wholesalers. And so, that's why so many people have started wholesaling, they make some money, and they run out of money, and then they go back to their W2s.
Well, in this video, you're going to learn the new Holy Grail strategy that my sister and I have been doing for the last year and a half. And in five short deals, five deals, you could get yourself to a consistent $10,000 a month in income. That's right, guys. Five short deals, $10,000 a month in income. I'm sure that is piquing your interest. And so, make sure you watch till the end because I'm going to show you guys how you can participate in some of these deals with my sister and I. So, like this video, subscribe to the channel, and let's get to it.
All right, so the cat's out of the bag. Yes, the strategy is co-living. But you've probably heard people talking about co-living, and there are some folks who do it, but they're not doing it right. In fact, there's probably dozens of people out there who are saying, "Oh, co-living is great. It's a great exit strategy. A great place for me to get more cash flow for my deals." They are having a hard time cash flowing. Creative finance uses co-living to make cash flow because it creates so much more money than midterm rentals or short-term rentals or long-term rentals. But really dialing in your co-living strategy can not only just create a little bit more money, it can create a lot more money.
Now, because we've done this now for a year and a half, and we've gotten pretty dang good at it, we've found that there are five fundamentals to keep in mind when you are doing co-living properties for your real estate business. So, I'm going to dive into those five fundamentals right now.
Now, those fundamentals are what we call the 5 Fs. They are: Find, Finance, Fix, Fill, and Future-proof your business. So, let's start talking about finding the deal.
Now, of course, finding the co-living deal is really a huge thing because you need to make sure that you're getting it at the right price so that you can refinance on that property and make infinite returns. So, the deeper you buy this property, the better your deal is going to be. But the really cool thing about co-living is that it doesn't need to be the same kind of numbers you get with fixing and flipping. You're not trying to steal these houses. You don't need to get them at seriously low values. In fact, I have done a co-living deal where I purposely overpaid for a house by like $50,000. I paid 50 grand more than I should have paid for this house, and I wanted to see what would really happen once I worked out this framework. Well, paying the extra 50 grand didn't matter because once I did the deal, I was able to pull all of my cash out of that deal, including an extra $20,000, and I'm making infinite returns of $2,500 a month on that house. Sounds pretty dang good, right?
So, number one, finding the deal. So, you can talk to wholesalers as a great resource to finding some good co-living deals. But wholesalers don't necessarily know the types of properties that you are looking for in co-living, right? Wholesalers are just going to try to sell you any fix or flip, and they're really not going to understand the fundamentals on where these properties need to be. What we found is these really do well in C- and D-class neighborhoods and anywhere that's close to workforce. Now, there's a ton more little features that we can get into if we had a ton of time. But really, just paying attention to the fact that you need to be in working-class neighborhoods, C and D class is great, and be close to workforce is really important because a lot of the people who are living in these co-living houses, they are taking public transportation, and they're typically pretty much blue-collar workers. So, you want to be as close to their place of business as possible, right? Makes sense. They want to be able to hop onto a bus, hop onto a train, and get to work and then get home in a pretty reasonable amount of time.
So, finding the deal, a great resource again is wholesalers. Another incredible resource is the MLS. Yes, that three-letter word that wholesalers are like, "Oh, MLS is gross." It's it's not. Actually, the MLS is amazing. I've made millions of dollars wholesaling MLS deals. But when you're talking co-living, oh my goodness, it is like a honey pot for co-living homes because any of these stale listings that are just sitting there that are in C and D class neighborhoods that have specifics like close to transportation, close to workforce, these kinds of things. Well, now you can really go in and negotiate. And even if the house is on a major road, that's not a problem, right? When you're finding a house for a fix and flip property, being on a major road is problematic because someone's going to live there for, you know, the next 10 years, and they're going to raise a family there and have pets. And typically, the reason why people don't want to live near traffic is: A) noise, B) dead cats. Your cat runs out the door, your dog runs out the door, they get squished by a car. They're like, "Oh my God, now my little kid's sad because that dog's dead, right?" That's why they don't want to live near traffic. But when you're talking co-living, living near traffic is cool because there's a bus right outside, there's a bus stop right over there, and I can get to my bus stop much quicker. So, there's little nuances that you can use and keep in the back of your pocket to help you go out and do more co-living deals.
And so, for me, wholesalers, MLS, and then of course, finding your own using some of my most favorite strategies like agent outreach or direct to seller. You can do that as well. I don't really like direct to seller, but you can go direct to seller and agent outreach. Great methods to find some awesome co-living deals.
Now, the second F is financing these deals, right? You might be wondering, what kind of financing am I going to try to do on these? Am I going to go conventional financing? Am I going to go hard money? Typically, what we found is when you're acquiring a co-living deal, you want to use hard money, right? For me, hard money lenders have been super great. You can get incredibly competitive rates out there right now because there's so much business to be done. And so, for our acquisitions, we're using hard money lenders. Now, I have some great resources for you guys for hard money lenders that we will have as a part of our co-living community. So, if you do decide you want to work with my sister and I a little bit closer, we can make some incredible introductions for you there. But again, hard money lending is going to be your number one way to finance these deals.
Now, you might ask yourself, "Well, Jamil, how am I going to get the down payment to close on the hard money loan?" Well, again, you don't need to have any of your own money. See, the first co-living deals that we did, we raised the capital from private money partners. And I can teach you exactly how to do that because when you go to a private money partner and you show them infinite returns, and at the low end, 20%, 25%, 28%, I mean, these guys are going to start salivating at the mouth. You just have to be able to show them the potential. And because these types of properties have occupancy rates of like 98%, 99%, it's almost foolproof for that investor. So, it's a great place for them to park their cash, get depreciation, appreciation, mortgage paydown, and cash flow, baby. So, yes, financing these deals is really easy to do once you understand the fundamentals.
Now, the next thing you want to do is fix the property. But this isn't just regular fixing up. You want to make these properties done in a way that's going to entice people to stay in the homes. See, one of the biggest problems that people might think co-living have is high turnover. And if you're trying to put people into a house where it's like five bedrooms and two bathrooms, or four bedrooms and two bathrooms, we got a bunch of people sharing a bath. Those people living in those rooms are going to be just racing to get the heck out of that house because nobody wants to sit on some warm toilet seat. You know why that toilet seat's warm? Because somebody was just there. So, of course, you want to have a situation where everybody's got their own bathrooms. Now, not only is that important, but like climate control and how the kitchen is laid out.
Now, one of the things that we figured out is how to take some three-bedroom, two-bath houses with a garage and reformulate the floor plan to really make sense. So, if again, you decide you want to work with my sister and I, part of what we do in our new co-living community is we will provide for you guys a customized floor plan. Like a real draftsman is going to be making your floor plan dependent on your project house, which is pretty damn cool. You want to take time and you want to make sure that when you're fixing these houses, you're not just doing the bare minimum. You're not just trying to get some bodies in there so that you can start generating some money because turnover sucks. It really does. And it's costly, and it's wasteful of time and energy. If you really do this right, you can have people staying longer than you would in long-term rentals. I've got a co-living property right now where somebody moved in nearly 18 months ago, and if I ask them when they want to leave, they say, "Never." Never. They don't want to go because it makes so much sense for them to stay there. It's incredibly economical for them to be there, and we've made that place so dang comfortable for that renter. Right now, they're just sitting happy, they're stacking money, and when they get into a better financial situation, they'll be able to move out to their like forever home. But a great transition place for them. And if you make it super comfortable and you think ahead of what the needs of that person's going to be, then you don't have to worry about high turnover rates in your co-living property.
Number four, filling the home. This can be really difficult if you don't know the right places to look. Now, of course, you can go to Padsplit, and I'm a huge fan of Padsplit. Padsplit has helped me on a number of my co-living properties. But they cost money, and that might not be something that you want to do if you've got some extra time, right? You might want to fill these yourself. And so, there's some incredible resources for you to go to find this type of housing. We've got relationships that again, as a part of our community, we introduce you to. But just for you right now on YouTube, you can go to Zillow, and they have a section that allows you to rent by the room. Yeah, Zillow now lets you do co-living on their platform. So, you can rent by the room on Zillow. There's Roomster, there is Friendster, there are all of these platforms that are out there right now that are for roommates, that are for people who want to live in a co-living environment. And this shared housing isn't going anywhere. The reality is, is right now, these people are needing affordable housing. Affordable housing is the number one problem in the United States. And so, by solving this problem, you're not only going to get long-term tenants, but you're going to be providing affordable housing for these guys in the long run.
All right, now we are to the last F, and that is future-proofing your business. Now, what do I mean by future-proofing your business? Well, you got to get your money out of that house so you can take that cash and do it again. This strategy is so dope that if you had like $70 to $100 grand, or if you raised $70 to $100 grand, or if you had a partner who brought $70 to $100 grand to the table, you could keep flipping that $70 to $100,000 bucks every six months. Now, again, remember, the average cash flow on one of the co-living homes that we do, the way that we do it right now, is $2,500 per per month net net. That's after I pay the mortgage, after I pay the utilities, after I pay the cable and internet, after I pay the property manager, after I pay everybody, I'm putting $2,500 a month in my jeans.
Now, here's what's cool. If you're watching this right now, ask yourself, what do you need to make per month consistently to survive? Does that answer $10,000? Well, how many of that would you need then? A handful, five homes, right? Is that answer $20,000 bucks? Because like, you're a baller, well, then that's two handfuls, 10 houses. And if you could refinance that money and pull it out and do it every six months, that means you could do two deals a year. And that means within a few years, without really having to quit your W2 or have to do wholesaling full-time or any of the shenanigans that like require you to like fully invest your whole heart and soul into real estate investing, you could create for yourself an annuity of $10,000 a month by doing a couple of these deals a year, which really isn't that much brain damage. Like, now we're actually talking passive cash flow that can create financial freedom. And for me, that right there is hands down the best thing. Because again, wholesaling can be inconsistent. You're not always going to get a deal. You're not always going to get that check, and you're going to have some lean months. This has been the solution for so many people. So many wholesalers have gone in, made some money on a few deals, and then lost all that money to the industry by hiring VAs, by buying lists, skip tracing, doing all the things, paying for pay-per-click, and they flush $50, $60, $70,000 that they make from one deal right down the toilet. Well, what if they had taken that money, put it into a co-living house, and done that twice a year? Think about it. They could have gotten to $10,000 a month in a matter of two and a half, three years tops.
So, future-proofing this business is the following: Hey, go slow. We're not trying to race to freedom here. A couple of deals a year is really all you need to do. The next piece is making sure that you got a lender that is looking at this from a cash flow perspective. Now, as part of our Housing Alchemy Community, that's the name. As part of our Housing Alchemy Community, my sister and I are going to be introducing you to lenders that will do not only sales approaches on the appraisals when they're giving you the final refinanced value, but they'll also do it on income, which is pretty dang cool, right? So, again, future-proofing this business and future-proofing your life to make sure that you can stay a real estate investor making passive cash flow of $2,500 a month on five houses will give you that financial freedom that you've been looking for.
Now, I did promise that I was going to tell you how you could work with Rahima and I to get your hands on these types of deals and make an incredible return in just a little bit of effort. So, in the description, there is going to be a link, and you can click that link, and you can talk to my team. Now, this might not be for everybody. If you are not interested in financial freedom, or you're not interested in rentals, or you're not interested in the strategy, all good. But if you are really that person who maybe you like your W2, maybe you don't want to quit it, or maybe you just want to do it safely, maybe you're like, "Hey man, I tried wholesaling, but it looked like I had to work my whole day to do it if I was going to be successful and consistent," and I just couldn't give myself to the industry like that. I get it. It's hard to do that, right? So, if that's you, and you've tried your hands at creative finance or wholesaling and all these other strategies, but just because it requires so much time and effort from you, you kind of quit. Well, this might be the strategy for you.
So, again, in the description, there's going to be a link. You can click it, and that'll give you an opportunity to talk to my team. My team's going to let you know if this is the right fit for you. It's not for everybody, but it is for those people that have consistency in their blood and are looking to do this in a more reasonable time frame and create financial freedom for their legacy.
Now, if this was valuable to you, do me a favor. Like this video, subscribe to the channel, and send this to a friend who you want to see get financial freedom. And I will see you guys in the next video. Later.