How to Use Home Equity to Retire Early and HOA Headaches

David:
This is the BiggerPockets Podcast, show 849. What’s going on everyone? It’s David Greene, your host of the BiggerPockets Real Estate Podcast, the number one real estate podcast in the world every week, bringing you up-to-date information, how-tos and stories of successful investors that include how they did it and how you can to. Today’s episode is a Seeing Greene show and I brought in some support. Rob Abasolo joins me today as we answer your questions, our loyal listener base and we walk through what to do in different real estate conundrums. Today’s show we are going to cover a flip gone wrong with HELOC interest eating at a bank account, what happens when HELOCs turn against you, why we would sell a particular deal that’s doing well because it’s in an HOA.
And we also had one listener submit a question that was so good, we were incredibly intrigued that we had to bring them in to talk to them personally to get more information and give as solid of real estate investing and financial advice as we possibly could. You’re going to love today’s show. The topics are relevant for everybody that’s trying to invest and make it work in today’s market, which is the trickiest market that I’ve ever seen. Rob, what were some things that you think people need to keep an eye out for in today’s show?

Rob:
This is a good one, man. This keeps us on our toes. As investors I feel like we always understand the core concepts and fundamentals of investing, so it is always nice to answer some of these questions that are hyper-specific and hyper nuanced, because it forces us to think outside of the boilerplate investing advice sometimes and a little bit more like, okay, if we were going to apply this stuff, here’s what exactly what we do from a tactical standpoint day by day in our operations.

David:
In the real estate education space, which is where we are, it’s been ridiculously easy to give advice in the last decade. It was like, here’s how you calculate a property. It’s like, here’s how you analyze a property to calculate cash to cash return. Now go buy it. The market is becoming so challenging that you’re starting to separate the men from the boys, the women from the girls. It’s getting trickier. And so in today’s show we’re actually going to break down some of the nuances that people need to be looking at when they’re investing to make sure that they don’t lose money. Now, if you would like to be featured on a Seeing Greene episode, we would love to have you. Head over to biggerpockets.com/david. The link is in the description, so pause this, send me your question and jump back in to listen to today’s amazing show.
Before we get into our first question, I’ve got a quick tip for all of you. Learn and take action. If you like what I talk about or what Rob says and you want to explore new real estate topics, head over to the biggerpockets.com/store website and get up to 60% off for cyber money on so many great books and use the code, books 849, for an additional 10% off. So today’s episode is 849. If you use the code books 849, you can get 10% off of the already discounted books in the store. I’ve got several of them and which to pick up. Pillars just made the Wall Street Journal bestseller list.

Rob:
Nice. Congrats.

David:
Thank you. So if you don’t want to miss out, join the movement. That is the three pillared approach to building wealth. Pick that one up as well as some other BiggerPockets incredible additions. All right, Anthony is a longtime investor in California and Hawaii, much like me, and he joins us in the recording studio to talk about what to do once you’ve built up some equity. Anthony, it’s great to have you.

Anthony:
So let me give you just a brief, I guess, I hope it’s brief background. I started real estate investing in 2009/10. I’ve done hard money loans, did the fix up rehab, cashed out a lot, not a lot, not a bunch, but put a little cap money in my pocket, which was able to get me to the next property and the next property. I’ve done that a few times to be quite honest in crappy markets. But it’s gotten me to the point today where I’ve done that, traded up through 1031 tax exchange and was able to get into better properties. Here in Hawaii now I’m sitting on some nice real estate. One property is worth quite a bit. It’s hard to put a number on it, but if you look at comps just on whatever, Zillow or whatnot, I’m putting one property at somewhere around two million, owe 290,000 on it, tons of equity.
I have another piece of property in a small community in Southern California, I bought for 48K, worth about 250 now. I own those by myself. My wife and I own our primary residence, which we purchased for 595, probably worth about 1.4 to 1.5 now. And we purchased a vacant lot attached to our primary home for 195, probably worth 875 now. I’m sitting on a ton of equity. Yay. Yeah, and hey and look, and I’m making good cashflow on my rental. It’s grossing about 10,820 a month once you break it all down, I’m roughly cash flowing 6K a month-ish. But I’m using that cashflow to support our life here because it’s a single income household. I’m only making about 82K a year with my job. That’s not a lot in Hawaii. I’m going down a limb here, but I’m going to say that’s not much over poverty line here in Hawaii, because everything costs double. A two by four here costs $6.25. I don’t know what it costs on the mainland, but I feel everything-

Rob:
$2.25. $3.

Anthony:
Yeah, right. Everything I do out here costs me double. I do all my own rehabs as I mentioned earlier, tradesmen. I do all my work while having a full-time job. So when I was rehabbing that one property, man, I was working around the clock, literally just the only time I’d see my lady was I’d be in the shower and she’d serve me lunch while I was showering, getting ready to go to work. And I did that for two years. But look at where I am. So I’m super happy. I got a lot of equity, feeling great about that, but I’m equity debt up to here and don’t care. I’m trying to get HELOC, man, just throwing up bricks, man. I’m not getting any traction there. I just went with a lender just recently last week, matter of fact yesterday called him back, finally got him on the phone after three calls.
They’re like, we’re not going to do the HELOC in second position on a rental property, but we got a HE loan. I’m like, that’s great. It does me no good. I need the credit card effect. I don’t have any deals. I’m not going to take a loan and just start paying for it monthly with nothing in the pipeline. So really where I’m stuck is tons of equity. I’m 53. I’m pretty bused up. I’ve been doing a lot of work for a long time and my body hurts and I want to try to find a different path to continue investing in real estate and I really need to go after more cashflow. I want to retire, but I want to retire to make a W2 an option, but I want to focus more on real estate. If I just buy one house a year, fix it up, add to the portfolio, add more cashflow, I’m super happy about that.
One additive piece of information, we are in the process of changing the lot lines between the upper lot and the lower lot and then we’re going to sell that 1031 into a community in California where we should be hitting about 2000 to 2,400 bucks a month cashflow based on my calculations so far. So that’s going to be a great boost, but I’m just trying to find the path forward and I’m having a hard time as I’ve analyzed probably 30 or 40 deals in the last month and I keep coming up with donuts.

Rob:
Okay. So the main crux of it is you’ve got a lot of equity and you can’t really use it. Right? That’s the main problem. And if you could tap into that equity, you would use the equity?

Anthony:
100%. I’d basically be my own hard moneylender or private moneylender, however, whatever you want to use. I’d go and buy it, fix it up, refi out, take the money back out, do it over again.

Rob:
Okay. And then do you have any capital to put towards anything?

Anthony:
Liquid not a bunch. I just built a bunch of retaining walls. I just spent a lot of cash over the last year, maybe 150K fixing up the properties and so I’m probably sitting on about 90 ish K.

Rob:
And then the only way you can really get cash is by the lot line adjustment where you’re going to sell a lot off and then that will be your watt of cash that you’re then going to go and invest in a southern California community?

Anthony:
That’s correct.

Rob:
Okay. Is there any opportunity, just out of curiosity, to go with a new construction lender that can use your land as equity towards the down payment basically, or use the equity in your land towards the down payment and then build on that piece of land?

Anthony:
That is an option, but we’ve been here in Hawaii 11 years and my wife has not really had a job because of what she does. She’s a doctor of traditional Chinese and medicine acupuncturist and they don’t recognize her license here, so its been single income, so I’ve been floating the bill for her and her mom. So at one point we were Airbnbing and crushing it from 2016 to right up into the pandemic, but Hawaii abolished that. They’re super not into it. Get it, understand. So that was good. That was awesome. And I want to get back to the mainland and do that. She was amazing. She was a super host, she was fantastic at it. Between the two of us, we really crushed in that. I can’t wait to get back into that, because it’s cool meeting new people from everywhere and it’s a business and it’s a lot of work, but I’m a donkey and an ox, so it’s all good.

Rob:
Great, great. Okay. But what’s the reason for not maybe turning over the stone on building a new construction on that lot? Is it because you can’t STR it?

Anthony:
No, she wants off the island. She wants to go back to where she can have dignity of income, she can have her own life. Here it’s kind of one-sided, I’m working around the clock and she’s not. It’s super imbalanced. And to be fair to her, she’s spent 11 years of her life here with me supporting me and building this small empire we have, but I’ve got to give her, I got to be fair.

Rob:
Got it, got it. Okay, so you want off the island and that’s why you’re okay with selling that one lot.

Anthony:
We are open to selling the house, but I’m like we’re going to have good cashflow. Let’s not do that. Because once we move out, I did a light numbers, once we move out and rent this out because basically it’s a duplex upstairs, downstairs, we should be looking at roughly a cashflow of 2100 bucks a month. So between the property, potentially we’ll 1031 and two on the mainland, we’re looking at 5K a month in cashflow. That’s gross cashflow. That’s not accounting for some of the fix up and this and that, but still 5K a month, for most people that’s a monthly income from a W2.

David:
And that’s in addition to the 6K that you’re getting currently?

Anthony:
Correct.

Rob:
Does that put you at 11?

Anthony:
Yeah. I’m trying to get to 15, trying to 15 or 18. If I broke down all my numbers, basic household expenses, travel expenses and reinvestment expenses, if I hit 15 to 16K a month, I can basically retire and write my own story.

Rob:
So we are going to have some cash and we’re trying to make four to $5,000 extra thousand dollars a month?

Anthony:
Correct.

Rob:
And then how much cash will we have to do that outside? Is it the 90 or is it the 90 plus the lot sale money?

Anthony:
With the lot money, I would like to, that’s 1031 and with my cash on hand, I would like to get into a new acquisition if possible.

Rob:
So how much will that be total?

Anthony:
Well, let’s say we can get 875 for the lot after fees and expenses, whatever we got 825, 800,000 leftover, so we’re close to 890, let’s call it 890. Simple math.

Rob:
It’s a good problem to have. You’re like, I’m trying to make $4,000, but I only have $900,000. It’s like, okay, well at least you don’t have 5,000, you have 900,000. If you could just even squeak out, what? A 10% return, you’re looking at, what is that? Nine grand a month? Am I mouthing that out correctly?

David:
No, that’ll be a little bit, that’d be a 12% return.

Rob:
But 80, 8500 or something like that, right?

Anthony:
Yeah.

Rob:
So it almost feels like you could just, how close are you all to retirement? How many years away?

Anthony:
As stated I’m 53 and I’m pretty beat up, so I’m ready right now. But like I said, retirement would continue with real estate.

Rob:
Well, because it feels like typically I’d say if you were on the front end of the journey, it’s like aggressive, aggressive, short-term rentals as you transition to the second half of the journey. That’s where I feel like going more the long-term route’s not a bad call. It just takes a lot of acquisitions to do that. However you have the capital to do something like that. I might consider moving into some kind of, I know you like short-term rentals, so maybe you could consider a small multifamily that brings everything together. I’m a big fan of this model. I’m trying to crack this right now with a couple of deals that I’m working through, but small multifamilies that basically let me short-term rent a couple, medium term rent a couple, long-term rent a couple.
That way I’m not taking on the complete risk of turning it all into a short-term rental and I’m not sacrificing a ton of cashflow by making it all a long-term rental and I’m getting a diversified set of income from that. So is that something that would be interesting to you is maybe getting into the multifamily space on a small level?

Anthony:
I forgot to mention, so I’ve probably, like I said, I ran about 30 or 40 single family analysis. I’ve also probably done about 10 multifamily. I’m looking for anything from four units to 60 units, whatever. I’ve been looking at everything because I have-

David:
That’s where my mind went. I think you need to get out into a better asset class. I think you need to get into the multifamily space especially because I think you’re going to be seeing some opportunity there in the next couple of years. We’re already starting to see opportunity there. Rates are really high and you’ve got cash, so these high rates aren’t going to hurt you as much as your competition. Everyone else competing with these assets, they’re trying to go and put 20% down. They’re trying to stretch that 20% as far as they possibly can, and it has to cashflow and it has to get a high cash on cash return and it has to be in an area that isn’t going to cause them a headache. All these requirements to what you’re trying to find in an asset, it’s really hard to find, everyone complains, real estate sucks.
Well, you’re going to be going in there $900,000. If let’s say you buy a $1.5 million asset, you got to borrow 600 grand. Yeah, those high rates suck, but they suck a lot less for you at 600 grand than somebody else would if they had to borrow 1.3 or 1.2, something like that to buy the same asset. Or even you buy something cash. You could go in there and buy something for $900,000 that nobody else, and maybe it’s worth a little bit more than that, but they can’t find a buyer, because where rates are, it doesn’t work for another competitor, right? I’d love to see you sell something out there that’s got a lot of equity and no cashflow and exchange it for something that’s meant to cashflow like commercial property.

Rob:
I don’t even know if you’d need to go multifamily with that strategy. Whatever you want, but I think yeah, if you were open to that idea of just 1030, look, most real estate investors would be very angry at this advice, but if you did pay cash for a $900,000 property, you could totally make $5,000 a month on a short-term rental. If you just went and bought a cabin in the Smoky Mountains, a lot of cabins out there will gross 80 to $120,000 if it’s like a four or five bedroom. And I think you could probably lock one down if it was an all cash offer. Granted you’re going to work for it. You still have to run the business and everything like that. That would be one option. The other thing I was going to say is you said you’re tired, right?
If you just invested in some fund or syndication that oftentimes a lot of these right now are offering an 8% pref on the money that you’re investing, 8% on 895 is like $71,000, which is about 5,900 bucks a month. That would also get you to that and it would be 100% passive. Obviously you’d have to do your due diligence and you probably don’t want to put it all into one fund, put it into different to diversify, but that would be a way to just completely be passive and not even have to worry about working for it. So it just depends on do you want it to be completely passive or do you want to work for it and make a little bit more money?

Anthony:
One thing I should have added, so I apologize, but I’m 100% on board with the multifamily, because my wife and I own that lower lot together. She really has her heart set on eventually getting to this community we would buy in. So that money’s earmarked for a very specific location, so we’re going to use that money for her wishes, to where we’re going to eventually end up. And as far as the syndication thing is, I’ve looked into it a little bit, and with real estate, with the hard asset, the property itself, I can analyze it, I can figure it out, and I know I’m the captain of the boat and I’m not going to let myself down. I feel with the syndication I have to vet the property and the people.
I was listening to the BP, BiggerPockets podcast, no, maybe it was On the Market maybe and there was that syndication lost like 3,200 units and I’m like, yeah, that would really suck. So who wants to be part of that? I’m a little too conservative maybe. Right now I’m sitting around waiting to do something. I’m buying T-bills for like 5.5%, right? I’m like, oh, that’s cool. I’m into that. No toilets, no roofs, and the variable, that latent threat of someone messing me up. I think I’d rather just me staying charge. I know I’m not going to screw myself.

David:
That’s what I like about multifamily. You buy a 25 unit complex somewhere if you have to finance, you just don’t finance as much of it. You definitely don’t finance 80%, you do much less. You have enough revenue coming off that you can put a management system in place where somebody else is the frontline that absorbs all the garbage and then you just tell them how you want them to handle the problems and then they go execute it. Similar to a short-term rental, you could do something similar to that. It’s the asset you put your money in, Anthony, that’s going to make the difference in the quality of life, not the ROI. Don’t go chasing after the most growth you can get. That worked great to get you to this point. You’re actually the poster child of what I tell everyone they should be doing, is stop focusing on cashflow when you’re a young able-bodied person that can work.
Focus on equity growth when that’s the case. And then when you get to the point of life where you’re like, I don’t want to work as much like what you’re saying, take all that equity, convert it into cashflow, and now you’ve got the perfect transition here. So even though you may feel frustrated you’ve got all this equity in Hawaii and you can’t cashflow with it, you are actually the person that did everything right. You’re sitting on an incredible gold mine of several million dollars of equity and you don’t need to live in your primary residence. You’re thinking about leaving Hawaii. My brother, just like don’t put all three million into one deal and make mistakes and learn the hard way. Okay? Gently go out there and tip your toe into the water and see what it’s like before you put all of the money in there, but put this into assets that are meant to cashflow.
Single family homes, though they do cashflow and they can cashflow, were never meant to cashflow. We have to find the perfect scenario in order to get that to happen, which was pretty easy the last 10 years, getting a lot harder right now. We’re also probably heading into some economic recession where I don’t think residential values are going to plummet, but I do think that it’s going to be harder to find tenants. It’s going to be harder to get people to pay their rents. It’s going to be harder to find opportunities. I think the world, at least in our country, is about to hit a crunch. We’re going to feel it like we haven’t had to feel it before.
So think about the location. You want to be buying somewhere where there’s going to be steady jobs, where they’re not as likely to get laid off and if you don’t have any leverage, you’ll survive the storm that other people don’t. And if you keep some of that powder dry, you’ll just start seeing more and more deals are going to start popping up. People running into financial problem, people can’t make their debt service payments. People that have too much vacancy and they can’t float it. And I think that you’ll be able to start gobbling some of these things up. We don’t talk about it, but when rates are high, having a whole lot of cash is a really good thing.

Anthony:
Yes sir. I appreciate that poster child thing, man, because half the time I feel like a boob. I’m like, man, I’ve been doing this 14 years and I still feel like an idiot.

David:
Brother, there’s someone that could be making 20 grand a month in cashflow and that comes out to a little bit less than a quarter million dollars in a year, right? It would take that same person like 13, 14 years to get to where you are right now, and that’s assuming that your equity never grows. And that’s a 20 grand a month of cashflow that most people would give their right arm to be able to be in that position. You did it the way that you’re supposed to. You delayed gratification. You bought in the right location, you forsaked the immediate gratification of cashflow that everybody wants. You didn’t quit your job, you kept working, you grinded. Now you’ve got this big, big reward that you just have to make sure that you space it out in the right way, that you put it in the right places. Don’t just get like, ah, I got to do something and get nervous and run out there and buy something that you don’t understand anything about.
I like Rob’s advice. Buy a cabin in the Smoky Mountains. Your cash on cash return could be low, but so is your risk. And if it’s paid for in cash, the cash flow will give you the life that you want, and that’s what this is about. It’s about building a life you want, not having your ego get pumped up because you get to tell someone you have a 40% cash on cash return, even if that turns out to be like $800 a month. It doesn’t really do much to change your life. I’m stoked to hear this story.

Rob:
You’re a millionaire and you’re going to sell your property and have-

David:
Multimillionaire.

Rob:
… multimillionaire. You’re going to have 900K to make a lot of decisions that will make you even more money. So you’re good. You just need to sit with it a bit, talk it out with your partner and I think you’re going to be just fine.

Anthony:
Man, thanks you guys.

David:
I would tell people to follow the Anthony method, that’s how much I like what you did. Because everybody else is doing the opposite of you, man. They’re like, I don’t want to work. Work’s hard. I just want cashflow so I don’t have to work anymore. So they go buy this $40,000 duplex in a terrible area thinking that if they just buy five of them, they can quit at 26 and never have to work, and they just get themselves into a hole that’s horrible. It makes their life, it’s like running with weights, as they try to get out of it. And you said, no, I’m okay with work, I’m going to put my money where it’s going to grow the most, which was in an area with constricted supply, scarce resources, and growing demand, Hawaii.
Now it did exactly what it’s supposed to do. It grew exponential rates. You grew the equity that you had more control over. Now go transition that into cashflow. That’s a better method in general for growing wealth than the crypto method, which is like, no, just buy a bunch of crypto, hit a pump, cash out, and then never work again for the rest of your life. It usually doesn’t work out when people take that approach.

Anthony:
I must’ve been dropped on my head because a lot of times I wake up looking for more work. I don’t know what it is. My boy’s going to come over today and we’re going to do some work on the house. I’m like, hey man, let’s do some more stuff.

David:
I love it, man. If you could bottle that up and you could put it in an energy drink and sell it, I would invest in that product, right? We definitely don’t need less people that want to work hard. The more someone can love work the better position they’re going to be. And that doesn’t mean be a slave to your job, of course, right? You’re doing work that you feel good about that makes you feel better about yourself, that you enjoy and that adds value to the world as well as to your own portfolio. So Anthony, for people that want to reach out, maybe they’ve got some ideas that we didn’t cover. Where can they find you?

Anthony:
Really just BiggerPockets. Anthony Isgro, my last name, I-S-G-R-O. I just got on Instagram, but I don’t have a picture. I’m not doing anything. I barely got on Facebook. I’m a hermit a little bit too, so BiggerPockets.

David:
All right, find Anthony Isgro, his profile on biggerpockets.com. All right, thanks a lot, Anthony. Appreciate you, man.

Anthony:
Blessings. Thanks you guys.

David:
All right. And thank you to Anthony for that killer question about how to solve the problem of deploying the equity that he’s built up over time. I love that type of stuff. That’s where we get to really dig into the meat of what real estate investors should be thinking about at a high level. So Anthony, congratulations on your problem in air quotes and thank you for submitting your question. And I want you to submit your questions as well, everyone biggerpockets.com/david, and you can be featured on the Seeing Greene episode. Now, Anthony’s situation was so inspiring that I actually asked Rob to wait for a second, jumped on a plane, headed to Hawaii myself, and I am now coming to you all live from Maui, because I had to see for myself what’s going on. So Rob, I apologize.

Rob:
Yeah, it’s been a little frustrating. I’ve been waiting here in this spot for 12 hours. You said don’t move, don’t go eat, don’t go use the restroom. I’ll be right back. And as a true, loyal friend, I’ve been here, man, my back hurts. I thought it would be a little faster.

David:
Well, that’s the level of dedication that it takes to be a BiggerPockets podcast co-host. So it’s not meant for everyone, Rob. You are one of the elite of the elite. Go ahead and stretch out your back as I transition us into the next part of the show. At this stage, we like to read the comments that y’all have left in the YouTube section for the show. So if you’re listening to this now and you’d like to be featured on Seeing Greene, just head over to YouTube and leave us a comment. We’re going to read them. Our first comment comes from Florian Uyu, who says a cashflow conundrum debate with examples would be very helpful. Thank you for letting us learn from your analytical thinking process, complete with four different emojis. This was a very well-thought-out answer, which is probably why we are reading it. So thank you.
We are considering Rob and I having a debate either with each other or maybe on the same side against somebody else about how important cashflow really is when you’re trying to build wealth through real estate investing, who it’s important for, who maybe doesn’t need to worry about it as much and what role it should play.

Rob:
I think we have a question coming up on this very same thing, so stay tuned after the comments and we’ll get into this, a little bit more than the cashflow conundrum.

David:
That is going to be the name. I’m debating over cashflow chaos, cashflow critic, cashflow conundrum. There’s a lot of alliteration here, but the idea would be a book that explains all the ways you make money in real estate of which natural cashflow is only one. So thank you for the shout out there.

Rob:
Cashflow critic is pretty good actually. I like that. That’d be a good podcast name, the cashflow critic.

David:
Here’s the problem though, is the minute that people hear that, they never read the article, they just see the headline, right? So now I become known as the guy who says, I hate cashflow, but I don’t. I like cashflow just as much as everybody else. I just think that there’s more to life than just it. Much like Moana who wanted to get off of the island and see what else the world had to offer. It’s not that she hated Maui, she just wanted to see what else was out there.

Rob:
Have you really seen Moana, by the way?

David:
No, I haven’t, but I’ve heard the song.

Rob:
I’ve seen it 1,000 times without watching it. My daughter has watched it so many times and it’s white noise for me, but I like the songs. I’ve never seen it in its entirety, so maybe you and I can watch it sometime together, after Interstellar.

David:
If you hang out with Brandon Turner enough, you absorb every single Disney movie that there is in the world. He just sings, as a grown man he sings those songs in front of other people with no shame. Really embarrasses me all the time, but that’s mostly how I’ve heard it. All right, our next comment here. Hi David and Rob, I’ve been watching BP for over a year, but David, it was your challenge to get into real estate in 2023 that lit a fire within me. I signed up for BP Pro and I ran analysis of a little over 100 properties in three to days. Finally found two properties that not only has a small cash on cash return of 5%, but is expected to increase in value near a new medical center being built that’s walking distance away. I’m focused on taxes, depreciation, et cetera, more than just cash on cash.
Thank you for this great and fun discussion and all you guys do. Every time I hear both you and Rob, I become less fearful and I feel more empowered. It’s like you guys are virtual coaches. By the way, David, Rob may be funny, but you have bigger guns, man.

Rob:
Okay. I read this comment, I was like, oh, that’s so nice. And then they said, but David, you have big guns. And I’m like, did you write this? Did you write this David?

David:
Yeah, that would’ve been nice, but we both know I can’t. I’m not this articulate. What I do love is that he said that you may be funny, but he didn’t say you are funnier, right? So not only did he say that I have bigger guns, he didn’t even say that you were funnier than me. So who is this here?

Rob:
Well, and just to bring it back a little bit, they said, I may be funny, Rob may be funny, the jury is still out.

David:
This person knew how to get included on Seeing Greene. This is from myndfulness, spelled with a Y, not an I. Myndfulness, you have an open invitation to comment as often as you possibly can and we will prioritize your comments. Thank you for recognizing who the alpha of the show is here.

Rob:
Wait, wait, I have a follow-up, I can’t believe I’m just remembering this now, do you remember on the last Seeing Greene, someone was like, thank you so much BiggerPockets for all the things you do, and David, you’re just such a good-looking guy, I can’t believe you’re single, or something like that. And then I was like, is this real? There’s no way that this is real. Cassandra, who are you? That episode came out and she sent me a message on DM. She DMed me and she’s like, I don’t don’t know if remember her name was Cassandra, but she was like, hey, this is Cassandra from that Seeing Greene episode that left the nice comment about David, yes, I am real, LOL. And I was like.

David:
Wow. Props to Cassandra for actually existing first off. We didn’t think that was real, not that there’s anything wrong with it, but my audience base tends to be basically 100% men. I’ve never gotten a compliment from a female in all of my years on the BiggerPockets podcast. I am on a roll right now. What can I say? I got a good fortune cookie. Somebody blessed me. I don’t know what it was, but thank you all for Seeing Greene and Rob, for you being here to witness it.

Rob:
Hey, congratulations my friend.

David:
And if your name wasn’t Cassandra, we apologize. Alexandra. There we go. Look at our production staff. Isn’t it nice to have the privilege of producers that just pop in here with, it’s like Jamie on the Joe Rogan podcast right there with whatever we need. All right, our next comment comes from Nori Carolyn who says you’ve got a gift for making engaging content. Well, wow, the compliments keep flowing. I appreciate that, Nori. I agree that I do have a gift and I like to open it and give it to myself sometimes. Rob, you’ve got a gift for making engaging content as well, which is why you’re here on the show. She might’ve actually been talking to you for all we know, right? I’m assuming that that compliment was meant towards me.

Rob:
That’s right. Hey, there’s two of us now. Thank you very much Nori.

David:
And from King Louis I, thank you for this. Was wondering how the HELOC approach would work at this moment in time. I really appreciate this conversation. Now I love that comment too. I believe he’s referring to when we were discussing uses of a HELOC and it’s typically described as the only use is that you use it for the down payment on your next property. And that’s because over the years we’ve given that as a hypothetical example of when you buy a property that you create equity, the equity can be taken out to buy the next property. We call it the snowball method or we’ve often said if you get one good deal, it will buy your future deals. One of the ways we’ve described that was using a HELOC to buy your next property, but in today’s market that may not always work because cashflow can be so hard to find.
The debt to income ratios are very tight. We described using a HELOC to improve a property, which Rob is something that you’ve been doing quite a bit of in your own portfolio as well as our property. I think this is something that people should take note of. Don’t just ask how to get the next property, but if it’s a short-term rental, maybe ask how to improve what you’ve already got.

Rob:
Right. Right. And just for everyone at home that doesn’t know, a HELOC is a home equity line of credit. So it’s like a line of credit against the equity that you’ve built in your house.

David:
That is right, and we will be discussing more uses for a HELOC shortly. All right, one more review and then we’re going to jump back into your questions. This one comes from AS McNerney. They say, great content. Signed up for BiggerPockets in 2014, searching for another income stream. Never got active in the forums but have always enjoyed reading and looking at real estate. I ended up working my down payment generator and getting my finances in order. Found the podcast about a year ago and it helped me towards a path I always wanted to get into but never took action. I bought my first rental in January. Consuming content every day from the podcast is incredibly inspiring and highly educational. Keep it up. Thank you very much for that Apple review. We love your YouTube comments, but we also love the reviews that you leave us wherever you listen to your podcast.
So if you wouldn’t mind going to Apple Podcasts or Spotify or wherever you listen to your podcast and leaving us a review, we will love you forever. And Rob personally promised me that he would start working out his biceps if we got more reviews. So if you’d like to see that, which I think that I definitely would and many of you other people would probably agree, go leave us a review. All right, we love and appreciate your engagement. Please continue to like, comment, subscribe on YouTube as well and submit your questions at biggerpockets.com/david, to be featured on the show. Speaking of those questions, our next one comes from Francesco Ponticelli.

Francesco:
Hi David. My name is Francesco from Miami, Florida. Quick question for you. I have five properties here in Miami area, two of which are condos in the prime area, that is the Bricker, the marathon of Miami. One property I bought 340,000 in 2019. I put 50K on it and now it’s worth 650. I have a very low interest rate on that property. Insurance is skyrocketing, that is inflating the HOA. They doubled in the last four years and they are going to increase 30% more next year. Rent are flat, so I’m near the breakeven points. What do you suggest to do? One, keep the property hoping on the equity even if there is a risk of a negative cash flow, sell it and look for other alternative investment that is not a condo in Florida or wait and keep the money and look for investment out of state? Because in Florida it’s hot. Waiting for your comment. Thank you.

David:
All right, thank you Francesco. Very nice video. And you’re actually in a good situation. You have good or better options here, not just good or bad. Francesco also left us a little bit of a written supplement here. So what he says in his writings is that given the current market, I’m torn, number one, do I keep the property and bank on equity in the longterm but risk possible negative cashflow? Because as he said, the HOAs are adjusting and they’re becoming more expensive. Number two, sell it, then wait for a local gem to invest in. In the last two years I haven’t been able to buy anything in the Miami area priced below 500,000 with a positive ROI. Or number three sell and venture out of state where you still have positive return on income, cashflow and equity growth. Maybe if I go further north. All right Rob, I’m going to turn this over to you in a second, but I find it very funny that we often assume every market is better than our own.
When I was in LA meeting with Meet Kevin, ironically, he was investing in a city called Oakley that is like six minutes away from where I record the podcast. I’ve never even considered buying there. I’m going to other areas. He did a bunch of research and ended up on this city that’s right in my neighborhood that I didn’t think anyone had even heard of. And I just thought it was funny that I’m driving six hours south to find a person who’s actually investing in my own backyard. And I think Francesco might be in a similar situation here. He’s thinking my own market doesn’t cashflow, should I go somewhere else, when so much of the world is investing in his market, which ironically is what’s creating the difficulty in finding the cashflow. So I’ll weigh in here with my two cents, but before I do, what are your thoughts?

Rob:
Okay, so let me get some clarity here, because I thought he was thinking about, maybe I misheard this question. We can edit this out if it’s not. But I thought he was thinking about doing a refi and pulling equity out, but since he’d have a higher interest rate, his mortgage would go up. Was that not correct?

David:
He said that in the video. It wasn’t included in these three questions here. So you can weigh that in on an option.

Rob:
Okay. So I’m pretty much always going to be against negative cashflow. I don’t think you should ever refi into something that gives you negative cashflow. So he’s wondering should he bank on the equity in the longterm but risk negative cash flow. So we think that his HOA fees are going to go up. I don’t like it. I don’t really ever like to tell someone to sell a property either, but I really don’t want someone losing money every single month. I don’t know why I’m like that, but I feel like it should at least break even. Breaking even to me is like a win and losing money is not.

David:
Well I think he said he’s nearing the breakeven point, but he’s concerned if the HOAs keep going up he could actually go the other way.

Rob:
I would probably just keep it until the HOA fees went up and then once they went up I’d probably sell it. I don’t think I would ever really want to keep something that’s losing money every month. Unless he can really absorb it. But I don’t know, not for me. What do you think?

David:
This question really highlights that real estate investing is moving from a checkers era into a chess era. It was very simple. Save money, buy property, run it through a calculator to find the highest ROI you can, buy in the best area you can and wait, that’s what I’m using as a checkers example. Now you’ve got all these variables, it’s much more like chess. You’re like, well my rate is low so if I sell and buy somewhere else I’m going to get a higher rate which will hurt cashflow, but if I keep it, the HOA can keep going up. So that could hurt me. Would that hurt me more than the rate increase if I buy somewhere else? And oh by the way, I’m in an area that’s still appreciating a lot, so if I sell to get more cashflow, I could miss out on the appreciation.
But is there a market where it’s getting appreciation and cashflow and your mind just spins through all of these options and it becomes really confident.

Rob:
And they’re all hard.

David:
Yes, none of them are an obvious answer. Which is, you mentioned the book that I’m working on right now. That’s why I’m writing it. Because we need a framework to look at questions like this from. It becomes confusing when you’re thinking my job is to get as much cashflow as I can. Well that’s very simple. Find the market with the highest cash on cash return and buy there. But as you start to weigh in all these other factors like future appreciation, future rent increases, HOA increases if you buy into the wrong market, the cash benefits of buying real estate if you work in certain ways. Now it just becomes less simple. So here’s some of the first thoughts that I was having. I will always prioritize the location or the area over the other intangibles in a deal.
So I really like South Florida. I really like Miami. When Francesco is saying I can’t find anything that cashflow is under 500,000. There is a reason for that. The reason is there’s so much demand to get in on that market that they’re bidding the prices out of the range where cashflow can work. But the reason that they’re doing that is so many people are recognizing you’re going to get a lot of appreciation. So if you look at a scale with cashflow on one side and appreciation on the other side, the appreciation in South Florida is so heavy that it’s outweighing the need for cashflow. So investors are buying there, which means that you can just keep going up in price range until your competition thins and you will hit a point where you can find properties that other people are not necessarily fighting to get.
You just have to be a little bit more nuanced when you get there because you have to be creative at finding a way to make it cashflow. It’s not going to cashflow on its own. It’s something you’re going to have to do to it to get it to cashflow. So that’s one option. Overall I don’t like that he bought into an area with an HOA. For investors, it’s not terrible, but here’s the problem. When you run the numbers, you can just include the HOA as an expense, which is how people have been told to do this for a long time. But people aren’t explained you lose control when you buy into an area with an HOA. You can’t stop them from raising that expense. You can’t stop them from hitting you with a special assessment.
So if you’re not aware, when you buy into an area that has shared common areas or shared parts of the building and there’s an HOA in place, if there’s a flood, if there’s a storm, if there’s a tree that falls on the building, if the pool leaks and they have to replace it, they can come to everyone in the complex and say, you all got to kick in $6,000 so that we can take an accumulation of 700 grand and fix this problem that we have with our plumbing or our electrical or our roof or whatever the problem may be, and you have to pay it. That can destroy cashflow and you can’t account for that in your underwriting. You don’t know what’s going to happen. Now, what you should do when buying an HOA is make sure that the HOA itself is properly funded, that they’re not low on cash, but that can even be tricky. Real estate agents themselves don’t always know how to figure that out.
So long story short, try to avoid buying in an HOA if you can. It’s tempting because the prices are usually lower and it’s easier to get in there. The problem is it’s easier to get in, but it’s harder to get out. It’s harder to make cashflow.

Rob:
Okay, so here’s my thought. I guess I would probably wait it out until the HOA fees go up, don’t sell if you don’t have to. And I’m not even sure selling right now would even be all that easy, but I would say probably keep it until you’re in the negative cashflow. His other option he gave us was sell it then wait for a local gem to invest in. And then he said in the last two years I haven’t been able to buy anything in Miami in the three to $500,000 range with a positive ROI. I really don’t really like this, I don’t like this idea of sell it and then wait for a gem to pop up. That’s way too lackadaisical. It’s not going to. I can tell you right now, you have to make the good deal. You and Brandon, you always say. I would say, and also from a capital gain standpoint, he’s going to make 300K on this property, so he’s going to pay capital gains on it. So he can’t wait.
He’s forced to 1031 into a property unless he wants to pay a pretty decent tax bill on that. What about this? We haven’t talked about this. I know this is going to make a lot of people at home very mad, but he says that he can’t find anything in the three to $500,000 range with a positive ROI, but he is going to make $300,000 on this sale. So what if he just put a larger down payment on a three to $500,000 property to get his payment down so that he could actually cashflow every month? In my mind it’s the same thing because he’s currently breakeven right now, but if he could go find something else and just put a really large down payment on and make more money with it, then I would feel like that’s ultimately he’s going to make more money that way. Does that make sense?

David:
He’s going to make more money in the cashflow arena.

Rob:
Cashflow. Right.

David:
But he could lose money in equity growth because South Florida just we don’t know what’s going to happen, but all the metrics are leaning towards that being an area of incredible growth in the future, because they’re so business friendly and the climate’s great and it’s like the trending place to be. I was just out there a couple of weeks ago recording a podcast to promote pillars and I was amazed at how much growth had been there just in the year before. It looked like San Francesco in San Francesco’s prime, which is the opposite, right? People have left San Francesco and now they’re moving out that way. The reason I’m going to, in this case like you Rob, I’m going to advise I do think he should sell, is that there is no way of controlling what the HOA is going to do in the future.
And HOAs are not always corrupt, but they are notorious for having management that is not the most scrupulous people. They can mismanage funds, they can take salaries for themselves. People that are listening to this that have had the experience probably know what I’m talking about. I don’t like putting so many eggs in a basket that I don’t control. I’d much rather see him have a single family home. If he could sell it and buy something else in South Florida that could function as a short-term rental and it’s just a single family home without HOAs that he has more control over, I’d love it. If he has to sell and move that money into a different area, I would prefer that and missing out on potential equity growth to at least have the safety that you’re not going to have your HOAs double over and over and over.
Because if you think about how most people raise prices, it happens with inflation. So the cost of the materials, the cost of the things that the HOA needs to run go up, they’re just going to pass that expense off to the people who live there and they’re under no pressure to keep expenses low. There’s no competition within HOAs. It’s not like, well, if we get too expensive, they’re going to kick us out and start another one. It’s incredibly difficult to do that.

Rob:
Yeah, I agree. The HOA board, it’s not like they’re qualified, they’re not necessarily qualified people, isn’t it just like the people of the complex all come together and nominate people and stuff? It’s not like you’re like a certified HOA person.

David:
You contract with the company to run and do the duties of an HOA, but the people in the complex can vote on them. It’s just no one’s going to put a ton of time into studying. Well, who are the people that we want to bring in? And once they get brought in, they just go make themselves comfortable. This is what you have to pay us and this is what we’re going to get. It’s not a capitalistic environment. I’ve often said when I retire from real estate sales, I’m just going to start an HOA, because it’s like the easiest thing ever.

Rob:
My wife’s complex back in the day, I think the president of the HOA was one of the owners of the houses.

David:
It’s small enough. Yes.

Rob:
Yeah, it was. It was a small enough complex. So when it’s small enough, it’s just ran by a lot of the residents who appoint the people. And it’s like, who’s really, I don’t know, I could see how unqualified people run it.

David:
Who’s going to be the president of the Boy Scouts? Well, let’s look at all the kids that are in the Boy Scouts and pick the parent who ties the best knot. But once it gets to a bigger size or it’s in an expensive area like Miami, they then contract with a company that provides HOA services.

Rob:
That makes sense.

David:
Tough spot to be in here, Francesco. Good news is you’ve done well already. You’ve had quite a bit of growth in the property that you bought, which has given you equity. And as I always say, equity gives you options. I think Rob and I are both on the side of, you should sell this thing while the market is up and put your money into somewhere that you have more control. Rob, any markets that you like that he should look into?

Rob:
If he’s in Florida, I was going to say he should stay in Florida, but I think with all the insurance stuff going out there, I would probably say not Florida. I’m hearing a lot of people rag on the Florida insurance situation, so right around that area, oh gosh, I don’t even want to say it, but Shenandoah, this is something that me and Avery Carl keep joking about because she keeps talking about Shenandoah. I’m like, don’t ruin this market for all of us. I think that’s a pretty good market to invest in. But that would be really more on the short-term side. On the long-term side, I can’t really speak to the East coast per se.

David:
I don’t think anyone knows where you can buy long-term rentals right now and just know you’re going to get cashflow. It used to be like, hey, this is the new place. Well I don’t want to go there. Okay, well don’t get cashflow. All right, fine. I’ll go there. Now it’s like all the investors have flooded the market and there’s so much demand for cashflow that I don’t know anywhere that traditional rentals are cash flowing, which is why so many people have moved into short term or medium term or creative ideas here. All right, Francesco, thank you very much for your question and giving Rob and I the opportunity to explain how HOAs work as well as the checkers/chess situation with real estate investing.
Our next question comes from Meredith in Austin. Meredith says that I did a successful first flip in Austin in 2017, and then I flipped another house in Austin this past summer using a HELOC and a hard money loan. On the second flip in this miserable downmarket, it took forever to sell and I ended up losing over 60K. Wow, glad that she’s sharing. That sucks, but there’s not a whole lot of people that are admitting when they lose money. So props to you, Meredith. I paid back my hard money loan at closing and only about half of my HELOC, so she took out a HELOC for part of the money and she was only able to pay half of it back because she didn’t have enough money, which left her with a balance. So my HELOC is hemorrhaging interest every month and I have this massive loss I can use against future capital gains and I’m trying to figure out what to do.
I’ve already decided to try a cheaper and less volatile market. I’m reading your Long-Distance investing book, David, but I wonder whether you would advise that I try another flip or two despite my huge failure in this one or try a BRRRR instead and cash out to pay back my HELOC. Is that even possible? My remaining HELOC balance is around 60K and that’s all the liquidity I have available for the next deal. Rob, what say you?

Rob:
All right, let me read this last part. I’ve already decided to try cheaper, less volatile market, but I wonder whether you would advise that I try another flip or two or try to BRRRR instead and cash out to pay back my HELOC. All right. This is a hard one. Well, first and foremost, Meredith, I feel you. I’ve got two flips in Austin that turned out to be total dogs. One of them is actually fine because I ended up turning it into what’s going to be a super crazy Airbnb. It’s going to be like a bachelorette themed Airbnb. So David, I want you to go and stay there and give me your thoughts. But the other one was a flip that we bought in Austin that was a screaming good deal when we got. It was like 400K and we were going to make like $100,000 profit on this and we’re like, heck yeah, we did it.
And then quickly after running through the bid and all the changes that happened in Austin, literally within two or three months we went from making $100,000 profit to breaking even or losing 10 or 20,000 bucks. And so that’s where we’re at right now. And we had already started the renovation, gutted everything, and so we were trying to think what’s the highest and best use for this property? And we were like, well, maybe we can demo it, build a duplex. And dude, we went back and forth on this for the last two months and then finally I had the bright idea. I was like, well, you know what? It’s already gutted. What if we just sold it for all the money that we’re into it? And so we bought it for 400K, we put about $7,000 into it, paid about another five or 6,000 in holding costs.
We’re all in like 415. Listed it for 450, got a full price offer. Someone’s going to buy our gutted house. And it’s like, oh my goodness, I can’t believe I pulled this off. But I’m going to say this, we were going to have to invest 100K to flip this house to break even. And I was like, holy crap, I don’t want to spend $100,000 only to maybe break even. So I was like, I’d rather just spend no money and lose $10,000 now. So I say all this Meredith, to just let you understand that even someone like myself, I haven’t done a ton of flips, this isn’t really what I do, but it was a really good deal at the time and the Austin market did turn very quickly for a lot of people out there. I think a lot of people in Austin are hurting.
So definitely would advise you to break out of Austin, which sounds like you’re willing to do. Should you try to BRRRR and build up so much equity that you cash out and pay back your HELOC? Is that even possible? Man, I don’t know dude, that’s a hard one. It’s like she didn’t succeed on her first one, but she could definitely use her mistakes on that to have a successful second or third flip or BRRRR. I just don’t really like getting into more debt to pay back the debt that you currently have.

David:
It feels like when you lose money gambling and you’re like, well, I need to go make more to pay back my losses.

Rob:
I need to double up real fast. Exactly. But that’s real estate and people lose money on flips all the time and people oftentimes have to flip another property to offset that loss. I interviewed James Dainard about it, just for some of my Insta Reels, and he was telling me about a deal that he lost money on, and I was like, what’d you do? And he is like, I flipped another house to pay for it. So I do think it’s relatively common. With that said, I don’t know if I want to advise it.

David:
Here’s why I think you’re hesitant. I’ve been thinking through it as you’re talking. James Dainard is a professional house flipper.

Rob:
Exactly.

David:
He’s dialed in. That guy is good. He can sit there and he can talk about construction. He knows the cost of capital. He does this. How many houses do you think James has flipped? Well over 100.

Rob:
Hundreds. Hundreds.

David:
Okay. And he’s immersed in real estate every day. He’s got a brokerage. That guy just never stops. I like James business ethic quite a bit. Meredith here is learning how to be a real estate investor. Now what’s confusing I think is oftentimes real estate influencers describe flipping as a strategy that makes it sound like it’s just like every other strategy. You could flip a house, you could buy and hold, just pick one and go for it. But the reality is flipping requires a very specific set of skills, much like Liam Neeson in Taken. And if you don’t have those skills, you can lose a lot of money as Meredith saw. Now, in the last eight years or so, very few people lost money flipping because the market itself was so favorable. You could do so many things wrong, but you just happened to gain $50,000 of equity while you made all those mistakes.
And so you sold the house and you still made a little bit of money and the mistakes you made were less expensive. They were less dangerous. It is the opposite now. As you saw Rob as an experienced investor, you bought a property. A few mistakes were made I’m sure, the market turned on you. The next thing you know what looked like $100,000 of profit evaporated like that, and you were lucky to get out from underneath it. I don’t want to tell more people to rush into that mess and say, yeah, just try to do it again. In general, what I’m saying here is that if you’re going to flip houses in today’s market, you should be more of a professional flipper. You know construction really well, maybe you own a construction company or the deal is so fat and juicy, you walked into a good one.
I had one time a friend who fell behind on her mortgage and she was a couple of weeks away from literal foreclosure, and she came to me and she’s like, David, I don’t want this to hammer my credit. Can you buy this house? And so I basically gave her what she, I paid off the loan and I gave her 20 grand to get out from underneath it. That deal was super, super juicy. So if you mess up on it, you’ve got a lot of wiggle room there. That’s not the same as going on the MLS competing with other buyers trying to get the house and trying to squeeze it out to make it work. I don’t think, Meredith, from what you’ve told us, that I would recommend you try to flip another house. Unless it’s too good of a deal to pass up. I’d much rather see you focus on something that’s a little more safe and wait out this market till we get some stability here and we don’t wonder if the market’s going to tank or if people aren’t going to buy homes.
One metric that I think everyone should be looking at right now is the days on market. It’s easy when you look at a flip to say, here’s a comp, it’s sold for X, I’m going to pay Y, and the construction and holding costs are Z. Let me just do the math with those numbers. But if you’ve got 15 houses available for sale and one or two pending, no one’s going to pay that price that you saw in the comp. It’s very misleading. You need to be looking at what is the supply in your market, how much demand is there for that and how long are houses sitting on the market before they sell? And don’t try to flip in a market where there’s already a lot of existing supply and not a ton of demand. Is that something that you’ve been noticing as well, Rob?

Rob:
Yeah. Yeah. Okay. I’ve thought about this while you were saying that. I think we had to really talk this one out to give some advice. James doesn’t really miss, and I guess that’s the difference. You’re saying he’s an experienced flipper, and if he does miss, like he talked about on that one deal, he’s got eight other deals that are going to make up for it because he is good at this. I don’t think Meredith can afford to miss again. And that’s why I don’t want you to go out and try to do it again until we clean up your HELOC and you may just have to pay that down the old-fashioned way. You might have to get, not to be too Dave Ramsey here, but a side hustle, another job. Figure that out.
I certainly don’t want to discourage anyone from continuing the real estate train because I think it is something that anybody can do, but if she’s feeling the pain from one that’s already hurting, I just would hate for this to happen again. So I don’t know. I would feel like waiting it out and nicking down her HELOC as much as possible. And then when rates allow for it refi out of the HELOC in a couple years, I think that’s my apprehensive answer to that. We don’t always have good ones, but that’s mine. I don’t know. How do you feel about that?

David:
I think it would be irresponsible to tell people, yeah, just rush in there and figure it out. If you’re sitting on $3 million of money to play with, you got a big fat stack of poker chips, you can learn how to play poker with live money. But in this case, I don’t think that that’s great advice. If Meredith was saying she has some kind of an advantage, my dad owns a construction company or I have an in where I’m getting deals at better rates than other people, that would be a different scenario. But I’m not getting that vibe from the question here. So based on that, I think Meredith, you should be a little bit more hesitant. Don’t stop investing in real estate. Don’t stop looking at deals, but don’t be thinking, I have to make that 60 grand back. Where’s my opportunity to make it back? Because now you’re assuming that the deal’s going to work out. You could have end up in $120,000 of debt just the same as $60,000.
There’s a line from the movie Rounders with Matt Damon and Edward Norton, really good poker movie, where they say, you can only lose what you put in the pot, right? You can’t lose money if you don’t actually put it into the market. Now, is it true you can’t gain money? Yes, that that is true. But once you’re already in debt, you need to be extra careful with what you do with the chips that you have remaining. And real estate is not a magic pill that’s going to save you from things. So Rob, I think you gave great financial advice there. You can only lose the money that you put into the pot. So be very careful in today’s market. If you’ve got a great hand, play it, but don’t feel pressured to play a hand that’s not great. Eventually the market will turn around and you’ll have plenty of opportunities.
Rob, thank you for joining me today. I thought solid advice here and it was a lot of fun as well as supporting me with your Disney knowledge.

Rob:
That’s true. Well, these are fun because they are so specific, niche and situational that there isn’t always a clear cut answer. There’s just like you can hear a couple of pros bat around things that they would do or how they would consider it, and you just use that to inform your strategy, right? There’s no right or wrong. There’s just what’s right for you. So don’t take anything we say too hard or too personally. Everything that we say pretty much comes from a place of like, all right, we want to try to be as helpful as possible, but recognize that sometimes there isn’t a beautiful resolution that’s super obvious at the beginning. You have to work through it a little bit first.

David:
That’s right. I really hope that we were able to help some of you brave souls who took action to ask questions. And I look forward to answering more of your questions in future episodes. Today’s show, we covered quite a few topics, including what to do when you’re strapped on cash, but have a lot of equity. If you should buy in an HOA or if you shouldn’t, as well as how HOAs work. When flips go wrong and HELOCs don’t work out the way you thought and had to pivot in a hard situation to make sure you don’t lose more money. Don’t forget to check the show notes for how to get connected with Rob and I on social media and let us know what you thought of today’s show.
Now, get out there, look at some more deals, find the very best ones, and take action when you find them. This is David Greene for Rob. No one knows how far he’ll go. Abasolo signing off.