Real Estate Investing Mindset With Eric Pittmann

FO 8 | No Money Down Investing

FO 8 | No Money Down Investing

 

No Money Down Investing is a valuable technique that ensures the safety of your investment in a market that has a tendency to be risky. Learn how to virtually invest from the comfort of your home with no money down! Eric Pittmann, a full-time Executive Coach at Vistage Worldwide, joins host Paul Lizell as they get into the mindset that investors need to have in order to be successful. Eric talks about creative financing and using private lending to secure deals using none of his own money. No money down investing is not easy to secure, but he explains how “asking” the right questions can give you the “yes” you are looking for. As Paul and Eric go over how important cash flow is to any real estate investor and a must-have in your tool belt, Eric also explains how easy it is to invest virtually from across the country and how technology has made it simple to invest without ever seeing a property in person.

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Real Estate Investing Mindset With Eric Pittmann

Private Lending For Rentals And Flips

My guest is Eric Pittmann. He someone I’ve known several years and is a pretty good friend of mine. He moved out to San Diego a few years ago after being a wholesaler in the Philadelphia market for years. He’s an Executive Coach for a company called Vistage Worldwide, a company that helps CEOs grow their business. He’s also a passive and active real estate investor. He’s investing virtually in the Pennsylvania market from his home in San Diego. In this episode, Eric attends to the ask and the importance of the ask. If you don’t know how to ask, the answer is always no. He talks about the mindset that investors need to have in order to be successful, grows their business and the importance of passive income and cashflow. We talk about private money, creative financing and how he’s buying most properties with no money down. We talk about the state of the market, the direction that the market is, different parts of the country and what other markets are like. We talk about how virtual investing is the future of real estate. Sit back and enjoy, read on as you’re going to learn a lot of nuggets of wisdom coming from Eric.

With us in this episode is a good friend of mine. He is somebody I’ve known for over a decade. His name is Eric Pittmann. Eric, how are you doing?

I’m doing great, Paul. Thank you so much for having me.

We’re going to jump right into this here. I don’t want to waste anybody’s time. Let’s get into your background. How did you get into real estate investing? Any trials and tribulations you had throughout the process? Give us the A to Z of where you started and where you are now.

I was born and raised in Philadelphia. I come from a family of a factory worker and a stay-at-home mom. We have a close family environment. I never grew up with any amount of wealth or money. We weren’t poor growing up but at the same time, things were simple. My dad worked at a factory, my mom was a stay-at-home mom and we had a nice little life together. I had one younger brother. I grew up in the city. I got into real estate by getting my real estate license at the age of nineteen. For me, that was my first glimpse into this whole world of real estate, selling these houses and making decent commissions. I was fascinated with it. What helped me get into the investing side of real estate was a book that probably a lot of people have heard of before called Rich Dad Poor Dad.

It’s everybody’s beginning. Everybody learns from that one.

When I read that book, Paul, it was a game-changer. A light bulb went off. I said, “This is what the rich people do. They invest in real estate and they own businesses that everyone else doesn’t do.” Immediately I said, “I have to go buy rental properties or I have to go invest for cashflow or do something.” That was a game-changer for me. At the age of 22 years old, I went and I bought my first rental property with my dad. To date, I’m working on my 55th real estate investment transaction. There are a lot of bumps and bruises along the way but at the same time, they’re all learning experiences to get where I’m at now.

That’s great that you started with your dad there too. That’s a good family bonding thing. You learn from it. The trials and tribulations and working with family is one thing.

My dad’s pretty easy going. I remember back in the days when I got started, my dad and me, we’d go to the monthly REIA meetings. We would go to the networking groups and we would always go out there together. It’s great memories.

As a matter of fact, I think that’s where we first met at an REIA meeting, over at a DIG meeting in the suburbs of Philly.

We met at DIG, probably at an REIA meeting. The connections and the people you meet at the REIA meetings are key.

FO 8 | No Money Down Investing

No Money Down Investing: Real estate is very much a people industry. If you’re able to work with people well and get them in agreement, this business is going to be ten times easier for you.

 

That’s why everyone out there, if you don’t belong to an REIA, make sure you join an REIA. You’re going find the seasoned investors out there who’ve been doing deals. Especially there’s a lot of guys who like the wholesale. I went to the Christmas DIG meeting and I looked around and I’ve been a DIG member since 2001. There’s the same group of about 10 to 15 people there. What everyone has in common, they’re all buying whole guys. Those guys have their same group of fifteen, which blew my mind. It made me change my strategy and go to more buy and hold. The rentals have always been a pain my butt in the past. I decided I’m going to switch that. I know you’ve done the same thing, Eric. I think you pivoted to that as well. If you want to get into that a little bit ahead and talk about what your strategy is right now.

The allure of flipping houses to make big checks is a huge draw in the beginning. I can make $20,000, $50,000, $100,000 flipping a house. That’s always going to be attractive. I realized after wholesaling lots of properties and flipping some houses that I’m like, “This is great, but I only got paid once.” I think flipping should be part of your strategy to generate capital that hopefully you can take and reinvest into more cashflowing real estate. This transition happened to me probably more when I moved out to San Diego. I took a little break from real estate investing for a while, got married and started out here. I was itching to get back in. I said, “This time around it’s going to be 100% focused on cashflow or how I can increase my cashflow.” This could be from rental properties, it could be from notes. There are many ways that you can generate passive income. I focused on the cashflow going forward. That’s my primary strategy now.

It’s called mailbox money or it used to be called mailbox money back in the day. I remember walking down to my mailbox, whether it’s an owner financed property I had or rental property I had looking for a check. Now with technology, apps like Venmo, I no longer have to go to my mailbox. It comes right into my bank right now.

I have the app. I have some of my tenants pay me through Venmo and it’s the instant transfer. It goes right into your account and it doesn’t get any easier than that. It’s all done right on my iPhone.

It’s easy and there are other ways you can do it too. I have an account with Cozy. Cozy allows people to basically auto-debit out of their account each month. Let’s say you have rent due on the 1st, the 5th or the 15th, it auto-debits. The drawback is unlike Venmo, it takes about 3 to 5 days to get to your account from their account to Cozy to your account. You have a little delay there but still easy, still great and still no cost to you as a landlord, which is tremendous.

It’s prudent as an investor to set the expectation with tenants and anybody you work with upfront. If you have a rental property and you just go in and say, “This is how you pay your rent via Venmo,” then you don’t have to worry about the other stuff or them losing checks in the mail or stuff. I’m doing that upfront and setting the expectation helps.

You hit the nail on the head. What changed everything for me for rentals from before when I first started doing it to now was that approach. Before, I wanted to get a tenant in there and I didn’t give them any information and I wondered why they went bad. Now, what I do is I draw out a list, “Here’s what you need to do, here’s what your responsibilities are. You’re responsible for this. You’ve got to mow the yard. You’ve got to shovel the snow.” I don’t want any questions on anything. You’re taking away any of those issues that can come up. As a result, I don’t have people going bad on me like I used to. I’m also better at screening people, which obviously it’s one of the most important things to do out there.

Text messaging is great too. I had one of my tenants tell me, “I don’t think I was supposed to pay a late fee last month. I wanted to check in on that.” I scrolled through my text history and they send me a picture of the receipt from Western Union when they sent the rent and it was out of the five-day grace period. It was right there and then it completely shuts down any back and forth or any of this stuff. At the end of the day, you want a smooth transaction.

You totally do. You try to create goodwill with them too. Every once in a blue moon you might waive it for somebody, but you don’t want to make a habit of that because then they’ll always end up paying late. That’s the way it goes. I want to go over one other important thing. I think the mindset you need to have as an investor. Your mindset and approach to whether you want to be a wholesaler, fix and flipper or a buy and hold guy. I know you’re a big mindset guy. You’ve read all kinds of books, you’ve probably read five times the amount of books on the mindset that I have. Tell me what’s worked for you and what books that you recommend for people too?

I think Emotional Intelligence 2.0 is a great book because this is a people business. Real estate is very much a people industry. I know there are spreadsheets and there are numbers and all that stuff, but if you’re able to work with people well and get them in agreement, this business is going to be ten times easier for you, which I always put a focus on. I said, “I might not be the best guy at an Excel spreadsheet, but I’m sure as heck going to get somebody to like me. I’m going to build rapport and I’m going to put together a deal.” That was always my mindset was anything is possible.

Always put together a good ask. Make it a win-win and get out there and talk to people and see what works. Click To Tweet

Another good book was The Magic of Thinking Big by David Schwartz. It’s books that have those titles of focusing on what’s possible, Paul. If you’re looking at the actual mechanics or what to do behind that is the number one thing hands down is asking for it. If there’s something that you want, ask for it. If there’s something that you absolutely need, what you might want to ask for more than that so you can work your way and give yourself some room to go back to that. I’m going to say this to the readers. Asking has the best odds on Earth. I’m going to tell you why. Because if you ask for something, if you don’t get it, you still already have what you had and you don’t lose anything. Always put together a good ask. Make it a win-win and get out there and talk to people and see what works. Because I’ve asked a lot more, I’ve got a lot more turned down than has gone through. The key is always asking and getting the conversation going.

I could tell you from knowing your work and how when we’re at an event or we were at a DIG meeting, how you would go up to people, introduce yourself. No fear. You may have an internal fear but it didn’t show when you talk to people. When you first came up to me, talking to me, there was no fear. I’m like, “This guy is down to earth.” You’re a Midwesterner. A nice, laid back, easy-going guy with no pressure. I never felt like you were asking anything of me and that’s how you approach things. Even though we ended up doing some business together, you never came out and asked me. It ended up happening that way, which is awesome.

Even though I’m from Philly, an East Coaster, I always made a point to focus on the other person, ask about them, build rapport because it’s a people business. If you’re building relationships, deals are always going to come and go. Having the relationships and we’ve known each other for years already and all the other people that I still know in Philly that are doing real estate. I’m always going to have those connections and relationships. Deals will come and go but that’s the goal of this industry.

It’s going to lead me right into the next topic right here. You build relationships and sometimes these relationships take 5 or 10 years and you end up finding a private lender. Somebody is like, “Eric, I’ve got extra money. I’d like to loan it to you.” Get into that. Tell me how you’ve been raising private money, how things may have developed or changed and if you’ve had any long-term relationships with some of these private lenders. Give me as little bit of background on that.

First, I’m going to say that I think private money and private lending is probably one of the most under-utilized strategies in real estate investing. There are many folks out there that are looking for a better return on their money. I’m not going to knock stocks and bonds and all that, mutual funds, that whole industry. I don’t know anything about it, but I know that everyone is always looking for a better return than that. The private lending, I always approach it from the standpoint of credibility. You want to build rapport and credibility with people as soon as possible. Whether your credibility is your experience, you’ve done many deals and you provide proof or the credibility is your character and your background. If you’re new, your credibility, you might just be knowing the numbers well, knowing the comps of property and having together a nice little sheet that describes your deal.

Doing that simple thing of maybe having a prospective sheet or here are the numbers of the deal. Here’s the estimated profit. Having that is more than most people do to pitch a private lender deal. Here’s a thing. This is where the genuineness has to come in. At the end of the day, the deal has to be a good deal. You have to be able to do it yourself or you would have your mom, your dad invest in it. If it’s not a good deal, don’t even try to pitch it to a private lender or anyone else because let’s say something goes wrong or it doesn’t work out, you’ve lost credibility and your reputation. That’s a big piece of it.

It’s important. People, students come up to me and ask all the time like, “What if I can’t find a lender on this deal?” I’m like, “If you’ve got a deal, the money will come.” If you’ve got a deal and you can’t find money, I might want to invest with you. It’s all about the deal.

I would imagine that of all the students you coach and train and teach that all the good deals, mostly probably 95% of them will get funded for the fact that it’s a good deal.

It’s all about the numbers. If the numbers work, people lend. Into the private lending thing there, I always had the mindset before and this was the wrong mindset. I had a financial background. I worked for the banks for years and I sold stocks and bonds and all that. I understand that industry, but I always came to mindset people are going to look in for a certain rate of return from their stocks. Why are they going to go to real estate? I’m like, “Dummy.” It finally hit me years ago. It’s secured. Common stocks aren’t secure. You’re secured by real estate. If they lent you $125,000, it’s a $200,000 after-repair value and you started to rehab, couldn’t finish it, they take it over. They sell that asset, they get their money back. If they finish fixing it, they’re going to get more than their money back. It’s a no-brainer. A lot of these hard money lenders out there, one people go bad because they know they’re making more money off that deal than they were. We’re just lending it. That’s going to lead us right into the next question here. Go over some of the deals that you have. I know you have a deal that you’re working on now that you had a money partner with and you’ve got good equity build up in there and that you’re looking to sell at this point. You want to get into some of your deals, as many deals you want to get into our work with.

I’ll keep it simple. My latest deals since I’ve lived in San Diego have all been remote and they have all been with 100% private financing.

FO 8 | No Money Down Investing

No Money Down Investing: The allure of flipping houses to make big checks is a huge draw in the beginning, but it gets tiring over time.

 

100%, he’s not using his money.

That’s an infinite return by my calculation if you’re able to. I also had to make it juicy for the private lender. If they’re taking on more risk, I had to make it a juicy deal for them and present it that, “This is why it’s a good deal.” Back in Philly, I did a lot of wholesaling and flipping but now that I’m in San Diego, I came here and like everyone else, I had sticker shock. I’m like, “A single-family house was $750,000? That’s only 1,500 square feet.” I tried to do some deals around here for a little while and I’m like, “There’s so much competition.” Where do I know people are aware are still some markets that I know of or I have some connections? Back in Pennsylvania, a little town called Scranton, some of you might know it. It’s about an hour or so north of Philadelphia.

I connected with a wholesaler and for a while I was always looking for wholesalers to reach out to because I didn’t do the marketing anymore. I said, “Where can I find deals?” When you call realtors, let me reach out to the wholesalers, whatever. I got on some lists and 1.5 years ago, a wholesaler called me and she said, “I have a three-unit apartment building, three-unit triplex available. Are you interested?” I said, “Yes,” but they were asking a bit much at the time and was more than I wanted to pay. I went back a couple of times. I said, “Would they take this? Can you guys accept this?”

After a couple of back and forth, I got the price down by $35,000, which is fantastic. I said, “Hands down. I have a phenomenal deal here.” The monthly income was $1,800 and the purchase price of the building was $45,000. I said, “Without a doubt hands down a deal.” Now I have this deal on the line. I said, “What do I do? I’ve got to go get financing for it.” I’ve been going consistently to all of my local real estate investment clubs here in San Diego, building relationships and credibility. I presented this deal to someone else in the club and I had my sheet all ahead with my one-pager of the description of the deal. I printed out a bunch of copies and at the buy-sell trade segment, “Does anybody have a deal?” I stood up and said, “I have this. I’m going to put some papers back here.” I talked to a couple of people and someone was interested.

I said, “This is the deal. This is everything.” They’ve never been to Pennsylvania. They asked me about it, I said, “I have boots on the ground and I know people.” They said, “I’m willing to finance the deal.” They originally asked for me to put up some capital and I was a little bit short on cash at the time with some other deals going on. This is where the ask comes in. “I’ll tell you what, if you finance 100% of this deal, I’ll give you 8% interest only on the note and then we’ll split the cashflow.” The cashflow is every month. At that point, this party was interested, but they still would say, “Maybe.” I said, “Here’s the final bow. When we sell the property someday, I’ll split the profits with you, equity split.” Finally, it was 100% yes. I’ve got to go-ahead from them. They put up 100% of the acquisition and the closing costs and all the repair and maintenance. There were a couple of things that we needed to do in the property and there we go. I had a deal. 100% financed. The private lender was happy and you might think, “Eric, you gave up a big portion of your profits.”

Keep in mind that I had zero into the deal. Whether I was making a dollar a month or not, I still had a deal that I was the part-owner on that I was getting paid every day. For me, I was like, “This is a no-brainer.” This is an out-of-state long-distance deal, which is incredibly easy to do nowadays, by the way. Paul, I’ve never even seen this property in Scranton. I’ve never even been there. I’ve had contractors go there. I’ve had contact with everybody from here, from California, but I’d never even been to the property. I don’t even know if it exists, but I get paid from it every month. The takeaways from this deal here is number one, I found a great deal and number two is I had to ask. I wouldn’t have had that deal if I didn’t ask it and creatively tweaked a little bit by saying, “What about this,” and going back and forth. That’s also the negotiation back and forth piece. It’s the power of the ask. Now, it’s cashflowing property and everything’s going well.

Are you selling this one? Are you keeping it for a little while? What are your long-term goals with it?

My realtor in the area said it’s worth significantly more now that we did some updates to the property and we increased the rents. At this point, I think we’re going to go ahead and sell it so I can cash out the private lender and get the equity and roll it into another deal.

That’s great because that would be a longer-term capital gain for you too, which is a nice benefit here. You’ve got that short-term cashflow from it and you’re also going to get an equity split here. You’re going to get some nice cash walking away that you can use on your next deal to purchase. You’re in a great situation there. They’re happy they’re getting a great return on this one. You look at it, that 1% rule, people generally look for 1% of what your gross rents are compared to what you purchase for the property. This one, what you did here, $1,800, this is a 4% rule. This is a whale. You don’t find these often. I’m sure you put some money on insurance.

I look at the scale of rental properties, this will be like a lower B, C-level property when it comes to categorizing it. At the end of the day, folks need places to live and the property is pretty clean and it’s a good place, a good investment.

Real estate is most definitely a people's business. Focus on the other person, and build rapport. Click To Tweet

It is a good place. Scranton’s starting to come back. It was an old coal city and they’ve got business and industry. There’s a lot of people move in there from New York, New Jersey to escape the high taxes and the high cost of living there. It’s becoming a much more desirable place to live. It’s near the Poconos. I do a lot of investing in the Poconos. I have a place in Wilkes-Barre that I’m listed for sale that’s right down the road from Scranton. I invest heavily in that area as well. Like you are, 90%-plus of my properties I never see and you don’t need to see it. That’s the joy now. What we can do investing now, we couldn’t do many years ago. Technology has changed everything.

There are deals like this all over the country. I’m in San Diego, I love living here. Obviously, to buy investments in San Diego, you’ve got to raise a lot more capital. There are bigger deals. A lot of investors, they go out of state and nowadays it’s completely doable.

It totally is and in these types of markets too. This is a little nugget out there to investors whether you’re experienced or a new investor, especially the new investor in this one. Don’t just look at the major markets like Philadelphia or St. Louis and a big city like that because you’re not going to get this 4% return that you’re going to find when you go to these outlying areas. I’ll categorize properties or areas. You have a tier-one city, a tier-two, a tier-three, a tier-four, tier-five, etc. The farther you go out, the better deal you’ll find and a better cashflow you’re going to find and less competition you’re going to have on those properties out there. If you’re looking to invest and you’re a newbie and you live somewhere that’s outside, invest in that area. You don’t want to get into the major markets out there necessarily.

Those markets are the ancillary markets and around those major areas, I think there’s a lot of value in them. I believe it. They’re all over the country.

They are all over the country and you follow where the industry is moving, where it’s growing. You look at Dallas and it is growing exponentially. Start looking outside of the Dallas area. What are the next towns that are going to grow and blow up? You’re going to have big valuation changes. You’re going to have increases over the next 5, 10, 15 years. Those are good places to purchase properties and hold them for a little while, get some current cashflow and then sell them cash out down the road.

The real estate market follows jobs. If there is a hardy job market, it’s a safe bet to say, “There are going to be some good investments around here.”

Any other deals you’re working on the Scranton area up there? Are you looking in any other markets? Are you focusing on that market in general?

I do. I have another tip for you. I was approached by another wholesaler and they say, “I have this deal. It’s a flip. Are you interested?” I bought the other deal off them as well. I said, “Let me take a look at the numbers.” I did my quick analysis. I said, “The property had so much water damage, total rehab.” Our estimate is about $65,000 in rehab. It’s a big old house. I think it’s 2,800 square feet, five-bedroom, three-bath and it needs a ton of work. Their original price they asked was way up there. I said, “No way,” and I threw out a ridiculously tiny number like, “I’ll buy it for $10,000. Call me back if that works.” They called me back and said, “I got a new price for you. Can you do $13,000?” I said, “Absolutely, but I need to find another money partner in this deal.” I reached out and it just so happens that one of the contractors that I work within that area. He said, “I’m interested. How do you do this deal?” I said, “We can do a JV.”

He’s like, “Do you want me to put up half or whatever?” Similar to the previous deal, I said, “Here’s what I’m going to ask. Here’s what I’m going to offer and see if you’re interested. You put up 100% of the acquisition and the renovation. You rehab the property. You’re a contractor and we both have vested interest in it. We split the profits on the backend.” He said, “Maybe, I’ll have to think about it.” I had to sweeten the deal a little bit more. I said, “How about this,” the holding cost of the money. I’ll pay you 8% holding costs on the money and then that also come out at the end, my profit to you.” That sealed the deal and I can do all the paperwork, I can handle the realtors and the sale and everything, and then he can just focus on the renovation and do his job. It was a good agreement and we’re both happy.

It’s another deal with no money down. For people out there who are new in investing and wanting to get into investing and don’t have any money, go outside the box like Eric’s doing here.

FO 8 | No Money Down Investing

No Money Down Investing: Private lending is one of the most under-utilized skills in real estate investing.

 

You just have to ask. If there are people like contractors or people there doing it or even if you don’t know, just ask, “I’ve got this deal here, would you be interested?” Without the ask, it’s hard.

That was a double ask because you had asked them to lower the price and what you told them what you’d be able to pay for it. It came back to work. It’s an ask on a couple of different ends there, which worked.

I thought this deal was dead. I think they were originally asking $80,000 for this property. I said, “For all this water damage? No way.” When they came back to me and they said, “We have this newer price,” I said, “Now it makes sense. Now it’s a good deal.” That one will be renovated and on the market. That’s good.

That leads right into another question here. I was going to ask you about buy and hold, fix and flip, wholesaling. You’re doing both buy and hold and now you’re doing a fix and flip. You’re putting no money down, which you can’t be at. That is tremendous. Have you wholesaled any deals recently or are you just doing those first two strategies at this point?

I haven’t wholesale anything in a long time because the wholesaling game is all about marketing and out there and making lots of offers not to do that. For me, I don’t have the time. I work a full-time day job, which I enjoy. I love what I do. I coach professionally during the day. For me, real estate is a wealth-building strategy that I do on the side that compliments everything. I’m able to do it nights and weekends and here and there and that’s the wealth builder right there. The day job pays the bills, but real estate investing is what builds wealth.

That’s their long-term growth. There are more millionaires made from real estate than there is in any other industry. It’s unbelievable.

I’m just a regular guy. I go to work like everybody every day. I decided to take some of that free time, nights and weekends and invested in my future.

Getting to your day job really quick. Some of the readers might want to know what you do. I know you’re in coaching, correct?

I’m an executive coach, so I coach CEOs.

What’s that like? Anybody in particular that the readers might know?

Being genuinely interested in other people and building relationships is the most powerful investment you can make. Click To Tweet

I’m not too sure if the audience would know anybody. These are small and medium-sized businesses under $100 million in revenue. I help them launch and create their own peer advisory groups. It’s a rewarding career. Imagine a whole bunch of CEOs helping each other out in a peer advisory group. I coach the leader of the group to launch that. It’s a specific skillset but I enjoy it. I love what I do every day.

I belong to a real estate mastermind group and all of us get together. Every quarter, we go over the troubles we’re having, what’s working and all that stuff. That is probably somewhat a few long lines with that but a lot of these guys talk about the issues that they’re having and how to resolve it and if anybody else has run into those issues as well.

Going back to the REIAs, if there are any newbies out there or anybody who hasn’t joined a real estate investment club, here’s the best thing you can do. A good investment of your time would be to consistently go and show up and learn and network at these events and do what I did. I volunteered to be on the board and I kept on asking one of the leaders of the club. I would say, “Is there anything I can do to help?” It started out as doing some tech help with setting up a projector and something like that. Eventually, I was asked to come on the board. Now I work with the leadership on the board for the real estate investment clubs. It turned out to be a fantastic ROI on my time. I would encourage the readers to volunteer, help out and ask how you can help. Those karma points will definitely build-up for you.

They definitely built up big time. I’ve been coaching travel baseball for years and the relationships you build there, some of these people I’ve done business with too in real estate. It comes out naturally. After years, they finally ask what I’m doing. One of the guys I coach with, you know probably pretty well, Raymond Lameer who’s working with DIG now. He and I coached together for years. We didn’t even know what each other did. We never talked business one iota. We talk about coaching baseball. It was hysterical. His wife is involved in the note buying business and she does a tremendous job with that. Raymond does his own thing with buy and holds and fix and flips. The coaching though, volunteer. If you’ve got kids that are playing sports, whatever it is, if you have that level of expertise in it, volunteer. Good things will always come to that. You’re giving your time, you’re not getting paid for it, but you are getting karma points, as Eric said. You will definitely get those. Do it with the best intentions and good things will come.

Being genuinely interested in other people and building relationships is the most powerful investment you can make.

I want to get into another question that’s related to the economy here. I think we’re past the peak of this real estate market and we’re either plateauing or potentially in some markets we see a slight decline, especially those higher tax markets. Where do you think we are in this market and what investment strategies would you recommend to our readers?

I definitely think we’re either in a plateau or slightly dipping down a little bit. I know the national supply of housing is definitely trying up. That’s dwindling. The building of new homes can’t keep up with the demand and that’s across the nation. Other than that, back to the cashflow. That’s what I believe in. When you have a replenishing source of income month after month, that’s one of the most powerful things you can do. Everybody might have a different strategy. They might be more attracted to the flip or wholesaling or anything like that but take a look at your own financial plan. What is it you want to accomplish? Write down your goals, put them in writing. Write down the income you want to make.

I look at it as three stages. There are stability, success and significance. You want to get yourself in stability with a lot of the basics covered. The debts are paid off and steady income. Success comes in when you start acquiring more real estate. You’re building up more equity in your deals. Finally, significance. This could happen in different stages of your life. When you got the point, you’re making great money. It’s coming in and you want to give back. You want to coach or train or mentor other new real estate investors getting into the business. I think it’s a combination of things and it is unique to the person, but write down what you want. If you’re a person that has always struggled with cashflow, write down, “My goal is to have $3,000 a month in passive income cashflow,” or whatever the goal is.

Basically, you’re saying to build up your financial goals, figure out what you need and go from there. The passive income thing helped me with the deal flow down a little bit. I had some months that weren’t as good as other months and rental income, the owner financing income, I was still fine because I had that coming in. That passive income still supports me, still pays the bills, pays for everything I needed to do. When the fix and flip is done or when a wholesale deal is done and then you’ve got an inflow of cashflow and then you’re buying another rental.

The readers have to decide what works for you and what your own goals are. Don’t compare yourself to anyone else. Somebody might want $100 million and someone just might want a couple million in the bank or whatever. Decide to work on what works for you. Along with that is simplicity. Simplicity is the ultimate form of intelligence. Keep things simple for yourself. If you’re not a fancy spreadsheet person, write it down on paper or keep it simple. Play to your strengths.

FO 8 | No Money Down Investing

No Money Down Investing: In order to engage in private lending, you have to make your deal juicy enough for the lender.

 

You’ve got to look at a million different things too. Like you may have business goals that are lofty, but you also have family goals that you want to do. If you push those business goals, that’s going to affect your family goals in a negative way, which could result in bad relationships with a spouse, with the kids, other family members. It’s important to find that balance. You may have this goal in business, but you also got to understand what your goal is in your personal life. You’ve got to take care of your personal life, which will make it easier to build in your business life as well. A lot of people forget that. I always forgot that when I wasn’t going just to get that balance because you won’t get that time back. You’re not going to get that time back. Time is our most valuable asset.

The greatest asset on Earth is the time.

I wish I get to buy more time.

I think we all do. I know with real estate, we can definitely make more time in the future. It’s allowed me to look for investment on earth.

It allows you to live a lifestyle. For me, working for myself, it allows me to be flexible with my kids’ schedules, with sporting events or picking them up. If my wife needs to do something in the morning, I can drop off my daughter to school. The boys are older, so they are there on a bus or driving themselves. It’s great to have that flexibility.

You’ve got to create it because no one else will do it for you.

Eric, I don’t want to take up any more time. You’ve given so much. I appreciate you being a guest and I’m probably going to be asking you down the road here again to be a guest here because I want to see you. I want to do some follow-up and see how things are going for you and see what has changed. Some of the readers might want to reach out to you. Who knows? There might be some private investors out there looking to invest with you here too. Is there a good way to reach you?

You can find me on LinkedIn, Facebook and all the social media. You can shoot me a text. My cell is (215) 200-7665. Maybe text me, give me a call. I’d love to meet anybody if they have any questions, maybe I can help them out. My skillset is finding and negotiating good deals. That’s what I love to do. My passion is in the real estate investment space. If anybody has any questions, feel free to reach out.

Feel free to reach out to Eric. You will not find a more genuine human being out there, I can tell you that. One of the greatest people I’ve ever known, hands down. I appreciate your time here and good luck to you in the future. I’m sure we’re going to talk again here shortly.

Paul, I love what you’re doing and most success. Keep it up. You’re doing great.

Thanks, Eric. I appreciate it big time.

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About Eric Pittmann

FO 8 | No Money Down InvestingEric Pittmann is a full-time Executive Coach with Vistage Worldwide, a company that helps CEO’s grow their companies. He was also a full-time Investment coach at Fortune Builders, a real estate investing company with thousands of students all across the country. Eric has his own podcast, “The Real Estate and Passive Investing Show.” Eric was born and raised in Philadelphia, PA where he got into real estate at age 19 as a Realtor and progressed into an investor at age 22 when he and his father purchased their first rental property together. He then got into wholesaling in the Philadelphia area and had a great deal of success but wanted to make a change and decided to move to San Diego, CA for a fresh start. Building passive income is his goal and real estate investing is his desired method to achieve that goal.