JLM Blog | Episode 9: Leveraging Opportunities and Real Estate Fundamentals

Real Estate News, Updates, and Tips

Multifamily Real Estate Agency San Diego 

Podcast Episode by Jason Lee – Premiered  September 2, 2021

What You’ll Learn in the Podcast:

● Israel’s interesting start in real estate and why he chose to start his career in the smaller market of Bakersfield.

● A look into the opportunitIes available in CA for transitioning your garage into a rental or living space (ADUs).

● Why Israel is investing in Detriot and why you should look into it as well.

● Advice for those looking to invest in another stateand a new market.

● The paramount importance of creating the right team and fostering good relationships when investing in real estate.

● The mistakes to avoid when picking a contractor to work with.

● Why invest in real estate as opposed to other investment opportunities.

 Summary and Highlights:

In this podcast episode hosted by Jason Lee, he interviews Israel Oble, a real estate expert of about ten years and owner of a construction company in San Diego. Their primary focus is multi-family renovations from the exterior to the interior of units. They also started entering the accessory dwelling unit (ADU) space. These are small spaces converted into decent, livable homes.

He started back in 2017 after finishing grad school and was looking for an alternative source of income. He recognized that real estate investment would be the force that would take him financial freedom. He first thought of acquiring properties in California, which required high profit but low returns. Eventually, he had an idea to look into Michigan real estate. He was able to team up with a good contractor and start building their portfolio. He has also established a San Diego real estate agency.

Starting Small

Building ADU spaces make the most out of a small space and generate additional income. Some San Diego real estate agencies, can lease garages that have been converted into ADUs for $1500 to $1800 a month. This initiative helps owners the mortgage. San Diego is perfect for people who want to build an ADU within their property potentially. It’s significant to be familiar with the zoning and what your city laws are.

 

Urban Planning and Development

According to Isreal, Detroit has always been on his radar as it was once one of the greatest American cities of all time. After years of suffering through recessions and bankruptcy, the city has made a significant comeback providing jobs and diversity that have brought new business ideas that generates a good economy.

The city has raised the quality of life of the people in the neighborhood, crime rates are decreasing, and school districts are improving. This development has ushered in a domino effect of investors becoming interested in renovating the abandoned, damaged homes to make them habitable again. It is not recovering and thriving.

 

For a greater cause

For Isreal, it’s not only about real estate investments. It’s a bigger mission to provide a decent home for lower-income families as he grew up in lower-income apartments as a child. Because of this, he has also decided to do a house giveaway. His team is looking to find a hard working family who has struggled due to the economy and will fully renovate and furnish a house in Detroit.

 

How to Invest in Real Estate

Real estate is a business that will always be in demand and has a very high success rate. However, a critical piece of advice given by Israel is that if you want to start buying or investing in real estate, he recommends finding a qualified property manager, a trusted contractor, and an inspector to check the quality of the property. It would help if you were creating a team to start networking with investors in the local area. Being a first-time investor can be daunting, but you’ll get the hang of it once you start figuring it out. It’s essential to anticipate the risks and understand that businesses take a while to kick off.

    Episode 9: Leveraging Opportunities and Real Estate Fundamentals

    Watch the Podcast | Read the Transcript

    Transcript

    [Intro] 00:01Welcome to the multi-family millionaire podcast. The show that interviews multi-millionaire real estate investors and top producers in the real estate industry. If you’re looking to create passive income and achieve financial freedom so that you can do what you want whenever you want, you’re in the right place. Our goal is to simplify and make real estate investing easy for you. For more information, you can find us at www.JLM.realestate.

     

    00:30

    Jason Lee: All right, everyone so today multi-family millionaire with Jason Lee, I’m joined today with Israel Oble. He’s my good friend, colleague, and a very good contractor in town. And I just wanted to introduce him. How’s it going to Israel?

     

    00:43

    Israel Oble: Really good Jason, how’s it going man?

     

    00:46

    Jason Lee: I’m doing great. I’m doing fantastic. Just wanted to start with kind of telling the audience about a little bit about who you are and what you do and how you got started in real estate.

     

    00:56

    Israel Oble: So yeah, I’m Israel and I’ve been in the multi-family game for about 10 years now. I own a construction company here in town in San Diego, and we primarily focus on multi-family renovations from the exterior to the interior of units. We also started getting into the whole ADU space. So that’s a big opportunity right now, especially with a current legislation on ADU and yeah, man side of that, I do have a couple of smaller apartment buildings myself in the San Joaquin valley. And I also invest out-of-state in Michigan, the Metro Detroit area to be in particular.

     

    01:39

    Jason Lee: Awesome. And then how’d you first get started in real estate?

     

    01:42

    Israel Oble: So, I first started back in 2017, you know, after grad school, I really was looking for another source of income. And at the time, just my W2 wasn’t, you know, getting the type of money that I wanted. I figured through reading books and listening to a podcast you know, real estate investment was going to be that vehicle to get me to that financial freedom started off with a small fourplex out in Bakersfield and having the construction experience that I have, you know, I had my crews go out there renovate it. We forced appreciation to it. We brought solid tenants to the table and yeah, from then on, I just kind of took on all the headaches of you know, what a landlord comes across and slowly but surely, I just started building my portfolio from there.

     My wife also bought a fourplex in Bakersfield and before you know it, I had other friends that wanted to get into this space, and they were interested in buying properties where we eventually started JVing. After a while California started getting a little bit more expensive <laugh>. So, I asked myself, you know, where do you get those higher returns?

    Where can I start, you know, really plugging in my money and that’s were out-of-state investments. That was the idea. And I looked into Michigan to buy my first out-of-state rental. It was an SFR, it was at a killer price. I bought it for approximately 9,500 and it’s a little bit harder believe, but I bought it straight from auction and it needed extensive renovation and you know, luckily, I was able to partner up and have a good contractor on the ground as well. And we just kind of started building our portfolio slowly from there.

     

    03:33

    Jason Lee: Nice. So why did you pick Bakersfield as your first market to start? Why didn’t you start kind of where, where you were more local in LA or San Diego?

     

    03:42

    Israel Oble: That’s a really good question. So, I was actually living in Northridge at the time because I had attended [03:47 inaudible] Northridge at that time, you know, as a college student, I had extensive loans through my undergrad and grad school. My salary wasn’t the highest at the time. I was working a little bit on and off doing both leasing and I was also a college advisor at the time. I was starting to seek out markets where my price range and the cash flow made sense. So, you know, Bakersfield was one of the first options. I also came across good PMs and just started building those relationships and I just kind of stuck to that market.

     

    04:22
    Jason Lee: Got it. So, it sounds like you wanted to start in a market where you didn’t have too much cash, but you could still get in and cash flow from day one. Whereas certain markets like LA or San Diego, it’s very tough to get into in cash flow day one, you got to put a lot of money into it, the down payment’s probably bigger. So, you kind of got your career started in a smaller market to kind of work your way up, Sounds like.

     

    04:43

    Israel Oble: Yeah, and that was the way I started and from then on property values have gone up drastically, which is amazing. You know, Bakersfield in particular, it separated in different regions and there’s a Cal state university in the area and there’s just major developments happening in the downtown region as well. And I just kind of found my niche and just kind of stuck to Bakersfield.

    But now presently, I am still looking for opportunities in San Diego, especially with the whole ADU space, being able to have that opportunity to force that appreciation. These are awesome opportunities where you can essentially flip a property or hold as a long-term investment, especially because, you know, San Diego is an amazing economy, a lot of tourism. Yeah, man, we’re looking for a good plot of land. Hopefully an acre or so where we can essentially build out a few units.

     

    05:34

    Jason Lee: Got it. So, two questions for you. Number one is we’ll start here for someone who’s never heard of what an AU is who is in, you know, California. Can you explain in elementary terms what an AU is and how you can benefit from building one or converting a garage into an ADU?

     

    05:50

    Israel Oble: Yeah, absolutely. So, an ADU is an accessory dwelling unit. It’s basically you’re able to build a tiny house, but it kind of, you know, tiny, it’s going to mean a little bit different for people <laugh>, you can build something from, you know, 300 square feet up to 1300 square feet. If the lamp permits and the zoning on that particular area permits, you to do so.

    Garage conversions, you can build a unit like a studio or a one bedroom, and that’s making the most out of the current space that someone has, or if the opportunity to build is there, that’s additional income in your pocket that you can be getting.

    And at the market rents that San Diego currently is at, I mean, there’s some places where I see people doing garage conversions and they’re getting, you know, anywhere from like 1500 to 1800, you know, a month. And that’s based on square footage, obviously anywhere from like 400 square feet to 1700 square feet, which is pretty awesome. That’s also a supplement to help out with the mortgage If someone is, you know, purchasing the property with the mortgage versus all cash. It’s an opportunity right now that’s being offered in California that I suggest a lot of people to take advantage of.

     

    07:01

    Jason Lee: A hundred percent. I mean, San Diego is very ADU friendly, especially for anyone who’s looking to potentially build an ADU in your house or your multi-family investment property. It’s important to know like the zoning and what the city allows, how big your lot is, what the city will permit you to do that. But the number one thing is just to find a good architect and a contractor like yourself and make sure to know exactly what you can do and how many ADUs can build. Cause I have a client right now, who’s buying a 40-unit property in bankers hill, and he can make, he can build four ADUs in the back and turn it into eight units.

    So, double the property value, which is pretty crazy. That property’s being sold for about 1.6 million. If he builds those four ADU, he’ll be about 3.4 million, probably somewhere around there. And the AU costs will probably be like anywhere from, you know, three to 400,000 to build those. So, I think it’s a pretty good return if you do it right.

    And Israel’s also building an ADU for me right now, one of my properties and the story on that is basically, it’s an oversized two car garage and it’s about 650 square feet. And I I’m getting it permitted with my architect to turn it into a two-bedroom, one bath unit. And then Israel and his team are in about a month probably going to turn that into a rental making about 2,500 a month, which will increase my property value by at least 300,000. So, it’s definitely a big opportunity, especially cause the costs are much lower than the price per unit. I mean I think Israel all in with the permits and everything will cost about 70 to thousand, so it’s definitely worth it. So, thanks for sharing that, Israel.

     Kind of switching gears. The other question I wanted to ask you was you mentioned that you are also investing in Detroit. What kind of led you to go, you know, way out of state into Michigan? Very curious about that.

     

    08:45

    Israel Oble: Yeah. So, during my undergrad I studied sociology like criminal justice criminology, for grad school I studied public administration with an emphasis in urban planning and development. And Detroit has always been on my radar. You know, it was once one of the greatest American cities of all time. It was just amazing to see how the city through multiple recessions, bankruptcy lost a good amount of population. And just recently the city has made a huge comeback. The employment sector has definitely diversified.

    You have a lot of millennials in the city bringing in new businesses, new ideas, the job sector, you know, you have a lot of tech jobs coming in, Microsoft, Google, LinkedIn, they’re all in town. You have, you know, top accounting firms like Ernest and young down there and you have a brand-new basketball stadium. The little Caesars arena is out there. I just started seeing all this investment happening around the city and Dan Gilbert, the owner of the Cleveland Cavaliers and the CEO and owner of Quicken loans, He invested billions of dollars in this sector.

    It’s just amazing the renovations that have been occurring with that property values, A lot of outside investment. For me, it’s more of a passion and a mission, you know, fixing up a house. Not only you’re making money off of that, but you’re improving the quality of life. It goes back to like the broken window theory where you fix a window. And all of a sudden, you’re bringing up the quality of life in a neighborhood. Crime goes down, school districts get better and slowly but surely that broken window, all of a sudden turn into a fully renovated house.

    And the pattern is a domino. You know, the blocks in return have more investors coming in and fixing up houses. And all of a sudden, you know, property values for a neighborhood go up. I’ve had neighbors that have thanked me for rehabbing a house. And that in itself like has been an awesome issue that I see and that’s something that I want to continue doing.

    And I’m also looking to give away a house to a family in need. So that’s something that I’m working with my investment group. We currently have a total of 10 single family residences out there. We’re just kind of looking to build our next mission is to shop around for 25 units to 75-unit apartment building. And we’ve had all the systems in place. You know, I’ve had experience overseeing management for over 2000 apartment units in San Diego and inland empire.

    I’ve seen the turnaround, the small changes that you can make to bring up a community, you know, from fixing up the interiors, adding the latest finishes brand, new cabinets, kitchen, LVP, recess, lighting, new paint jobs to fixing up the exteriors like doing, you know, brand new stucco wood lats. It really does make a difference. And residents want to go into a community feeling safe. With that, you definitely bring residents that care for the community as well and more are more heavily involved in, in governments.

    And you know, they attend neighborhood watch meetings just to keep up the place. So, it’s a whole domino effect. The way I see it, it’s not just real estate investing for me. It’s there’s a bigger mission, especially because I grew up in like lower income apartments as a child. I definitely saw the turnaround of how management companies really influenced the day-to-day decisions of many households.

     

    12:24

    Jason Lee: Wow. Okay. A lot of things to unpack with that answer, but let’s start with this. So back to your house giveaway. Tell me more about that. What are you looking to do? How does someone who is in need get that house from you? What can they do? What’s going on with that?

     

    12:40

    Israel Oble: <Laugh> all right. So, the whole game plan with this is we’re looking to find a hard-working family that has struggled a bit, you know, due to this economy and we want to fully renovate a house and that’s currently in progress. So, we purchased a house through the Detroit land bank and literally installed everything brand new from electrical to water new furnace currently working on the roof and doing some exterior renovations. And once we identify a family working through a nonprofit it’s, then that we’re going to be seeing what their best recommendations are in terms of a family that’s gone through a situation they’re going to be interviewing them. And we’re still trying to structure the process, but overall, beyond that, we’re going to be paying for other stuff and just to make sure they upkeep the property and maintain it stable.

     

    13:35

    Jason Lee: That’s awesome. That’s really cool. In the Detroit area, have you seen it gentrify since you’ve gotten started? Have you seen like a big change from, like you said, kind of classy neighborhoods kind of moved to class B and a little better as these investors came in and put a lot of money into properties and such as big owners, such as I think said the Cleveland cavalier owner put a lot of money into real estate there? So, have you seen that change in the last couple years?

     

    14:00

    Israel Oble: Yeah, absolutely. I’ve seen, you know, parks like north park. That’s been coming up new developments coming into town brush park area court town, which is by Southwest Detroit. Southwest Detroit is like a predominantly like Latino neighborhood. So, it’s a very diverse place. You have a little bit of everything. It’s like a huge you know, melting pot. It’s amazing. There’s a lot of diversity and that’s what I love about Detroit.

    With that, with all these new developments coming in and redevelopments of, you know, houses that affects neighboring neighborhoods and neighboring places and everything that’s happening in downtown is starting to spill into the suburbs, which is pretty awesome. And then outside of Detroit, you have like little, smaller municipalities, you know, other cities, you have areas like Royal Oak, Ferndale, Dearborn that are surrounding Detroit. And a lot of those areas that are where investors are buying primarily affects all those surrounding areas too.

    So, it’s pretty amazing. There’s definitely a need for housing. First time I had marketed a house I literally had over 50 people inquire, you know, I had a, I needed assistance from some of my leasing staff to really follow up with everyone and to screen people <laugh> yeah, it was it was an eye opener. It made me realize that people need housing. They need, you know, good functioning housing. And that’s what Detroit is currently lacking, currently lacking in certain areas.

     

    15:36

    Jason Lee: Interesting. That’s all really good stuff. Switching gears, a little bit, if someone like you wanted to get out of wherever they’re living, listening to this and maybe invest in a different market because it’s less expensive or they used to live there, or they like the market better than where they are right now, because they know it more. What’s one piece of advice you’d give them that’s very important if they want to start buying or investing in a different market that’s outta state or different city.

     

    16:03

    Israel Oble: Yeah. Yeah. That’s outta state. I would definitely recommend for them to find a really good property manager, a trusted contractor, and just start building a team, start connecting with investors in that area locally. So, they can advise you on a day-to-day activity. You know, even if you have to pay them a little bit here and there, or if you have to pay for a mentor in that area, that’s already actively investing. It’s definitely worth it compared to the tens of thousands of dollars that you could be putting into the deal and redeveloping cause the construction part is what can make or break a deal, especially when you’re out of state and you don’t have direct eyes on it. 

    Another thing that I strongly advise for them to do is hire a good inspector or actually go out there yourself to buy a property, especially if you’re going to be buying big, like something in the 4, 8, you know, 20-unit range. You want to go out there personally, do your own due diligence, inspect, walk the units, and consult with professionals and to see what you’re getting yourself into.

    Also explore the local area, you know, drive around, or have someone do a little bit of research for you to see what current developments are happening, what businesses are currently invested in that market. It’s going to take a little bit of leap of faith. You know, it’s scary off the top, someone as a first-time investor wanting to plug in outta state. But once you take that leap of faith, you start figuring it out, but just make calculated risks. Is that what I that’s something I suggest people have that team in place prior. If you guys have any questions on that, you can always reach out to me as well.
    17:38

    Jason Lee: Yeah, that’s huge. I think the most important thing before getting into a new market is knowledge, right? Especially multi-family I tell my clients is very street by street. For example, if you’re looking to buy a property in central San Diego, if you’re on north of Alcom Boulevard versus south of Alcon Boulevard, two totally different markets and it’s just one block away from each other. So just like any other market like San Diego, I feel like other areas will be the same where the property you buy is very street by street.

    So, I think it’s very important to, like you said, make the right relationships such as hiring the right team. Most importantly, a good property manager who handles your asset full time. A good contractor, good broker, good loan officer that can do your loans and kind of just diving into it.

    But I think a lot of people who go outta state just don’t do enough due diligence and don’t look at enough deals and underwrite enough deals to know what a good deal is in that market. And that’s kind of where I’ve heard the horror stories of people losing money outta state. But I feel like if you like yourself, do your due diligence, make the right relationships, which is the most important part. I think anyone will do well in anywhere in the US or in the world. So, I think it’s the same principles for any city.

     

    18:46

    Israel Oble: No. Yeah, I definitely agree with you on that. You’re going to need an, a player in every category that you just mentioned. So, you know, partnering up with someone like a top producing broker like yourself, good solid PM manager on the ground. I mean, I’ve seen it all, man.  You know, my family’s been in this property management industry and construction for 30 plus years and we have seen everything, man. And we have also seen a lot of landlords make a really great living and ultimately building that generational wealth that we are currently seeing like some of these owners now passing on some of these assets to their children, which is powerful because they’re keeping up with operations now. And they’re working with property managers to keep everything up afloat. It’s just a powerful tool, man.

     

    19:38

    Jason Lee: Yeah, that answer actually leads me to a really good question for you. Yeah, if a newer investor is looking for their go to property manager or their go to contractor, what advice would you give to vet that person out properly so that they don’t just to make sure that they’re not, you know, teaming up the wrong person, because there are some people who might screw you over in this industry. It’s just the truth. How would you go about finding an honest contractor or property manager that’ll do a good job for you?

     

    20:04

    Israel Oble: Absolutely. I would start with interviewing a few contractors, interviewing a few good property managers. You know, it’s really funny. I joke around sometimes when I meet contractors, I’m always like, hey, I forgot my measuring tape, do you have one? <Laugh> they have one, you know, for sure they’re legit. I’m just kidding though. That’s a joke, man. <Laugh>

     

    20:24

    Jason Lee: That’s good. That’s good.

     

    20:26

    Israel Oble: But yeah, I carry a measuring tape in all of my trucks in all my cars, man. So that’s a good one to know, but talk to them, have that conversation, you know, take them out to lunch, pick their brain, ask them what their current projects are. Ask them to see if you can see one of their projects in person or maybe if they showcased if they could showcase some work. Like I post a lot of my stuff on Instagram where I’ve been able to get a lot of my business and Instagram enables me to post pictures and videos of the work that I do versus other platforms. So that has been really effective on my marketing, but you know, talk to contractors, pick their brain.

     I always love to see a contractor that is an investor because there you will know that they know how a landlord thinks. They know that, you know, maybe they don’t want to spend as much money on turning a unit because the ARV is just not there. Or they understand a rental market. As far as a property manager, talk to them to see what assets they’re currently managing.

    Like I’m happy to show my clients the stuff that I’ve managed before. And I explain to them the whole process, you know, how I’ve been able to turn class C property into a B plus property. I’ll explain to them all the exterior renovations, the tenant based the processes, the accounting system, where we’ve utilized, you know, Yardy, the screening where we’ve utilized onsite and the whole system of staffing and maintenance as well as, you know, maintenance requests. There’s a lot that goes onto that ball game, but check their assets, see what property managers are currently managing. And also, just question them on, you know, fees, et cetera. It’s about building those relationships for sure.

     

    22:07

    Jason Lee: Yeah. I mean a personal story of mine is for contractors picking the right one is I recently bought a property in Imperial beach. I was a four-unit property needed a ton of work, it’s got a rehab, it got a fully vacated. And when I did that, I actually interviewed three different contractors. This is before we met, but two of them gave me bids for about 200,000 and then one was for like 150. And then the last guy I interviewed; he gave me a bid for like 110,000. So, some of these people, these contractors will give you very inflated numbers because they might not think like you don’t know the numbers or you don’t know what you’re doing. So, you just got to be very careful because some of these contractors are like to screw over some of their clients.

    So, finding an honest one, like Israel’s very important. A guy I found was pretty good for Imperial beach, but the fact that someone tried to charge me $200,000 for a four-unit rehab, just the interior and basic exterior was pretty crazy to me. And then someone else’s bid was almost a 100K less. So, I think the most important part is just vetting out a couple, at least three contractors and having a bid on your property. For the property management side. I think you hit the nail on the head is you got to see what they’re managing, what their assets are, how their properties look.

    Another huge thing that I do is I personally talk to the owners of the properties that they manage and see how their experiences with them. I also kind of look at how their operations is. I go to their office, I kind of check out some stuff what’s going on, how their employees are they happy? Are they in a good system? But yeah, I mean, that was a really good answer, Israel. So, I appreciate you sharing that. Switching gears, a little bit. What has been your biggest mistake in real estate investing and how did you learn from that mistake?

     

    23:44

    Israel Oble: It’s funny you that man, so for me was choosing the right people to work on my projects <Laugh>. And with that it’s the out state, the out-of-state part where I vetted out the wrong contractors, going back to what you said, even as an experienced builder, myself, working with the wrong contractor really makes or breaks an outta state investment.

    You know what they’re quoting me, the work that they’ve done. I had a bad experience where someone was working on one of my houses and they couldn’t even pull permits. And I had asked them multiple times, they had already done the work and here they were asking me for [24:22 inaudible] amount of money where I’m like, dude, like I told you to pull permits on this. It’s really hard to vet out folks, even me as an experience builder, just building those relationships.

    It hasn’t always been peaches and cream, you know, but after building some experience, you start building a team. I obviously do a lot of due diligence in finding the right people, especially if I’m hiring them out for different trades, whether that be electrical, plumbing, because everyone is a specialist in their trade. So, like when you hire a GC, definitely within that, there’s going to be so many arms.

    And so, the GCs themselves are not going to be experts all the time. You know, they might sub out someone that does electrical, but has been in electrical for like decades. So, get those formations. And I always see the general contractor as the, the guy who’s running the orchestra, just moving pieces and they have to have a high-level skillset and being able to manage time, meet project deadlines and move people around as well as update clients, if you know any issues occur.

    That’s a huge piece. Just having that communication with the owner and just being very Frank and honest, man. I always tell people, you have to find a contractor that has good ethics and I’ve always been taught that, you know, ethics comes first beyond anything. Yeah, man, shop around, get a feel for the contractors. Yeah man, I think I did a little bit over explanation on that question. <Laugh>

     

    25:52

    Jason Lee: No worries. No worries. It was all good stuff. So as a contractor, you know, yourself, what are some of the biggest challenges you face as a contractor? And if someone who might be listening is looking to maybe be a contractor themselves, how can they get into that space and kind of learn on how to do it?

     

    26:08

    Israel Oble: Definitely just being able to work under someone that’s experience, who’s done tons of projects, you know, getting that experience and building that their own reputation as well to essentially one day open up their own company. That’s a big piece in California. You know, you’d be surprised there’s a lot of states, that’s not California, but a lot of states that only require like a year of experience or no experience at all, and then you can be a certified builder, but you know, California has stricter standards on that.

     You know, with my company, we have a lot of contractors in every single trade, which is awesome because we have specialists in different items, but you know, there’s always new talent that we’re looking for. So yeah, man, just if you’re trying to get into this space, I always advise multi-family investors as well, learn the construction portion of it and pick someone’s brain on this stuff all the time, because it’s going to be a maker break in this industry as well. Especially if you’re buying like classy properties that are going to need extended renovation.

    So, find yourself a good partner. And that’s how I’ve been able to break into multiple investment properties myself. I’ve been able to partner up with other folks that, you know, bring into capital where my team brings into construction and the property management aspect of things.

     

    27:25

    Jason Lee: That’s really good. So going back to the part about being an investor and knowing, you know, how to build, I think it’s very important. When I first got into the multi-family investing space, When I was just a broker, I really had no idea how much things cost to, you know, replace a window, or fix the foundation, do the plumbing, electrical kitchen, et cetera.

    And I feel like I’ve had to learn the hard way just by doing it through experience. But I feel like if I would’ve consulted with someone just like you to kind of see what the costs are and what the costs of labor materials is and what it would cost me to do each project it’s much easier to underwrite a property and see exactly how much you’ll make once you dive deep into the investment and actually buy the property.

    So, I feel like I went the other way around. I kind of like bought my first property and then figured it out from there, but that’s kind of how my brain works. I just figure things out as I go and make mistakes. But I think the best advice for anyone that’s just starting is you got to really know your numbers when it comes to rehabbing, if you’re looking to, you know, flip property or, or buy property and force appreciation and sell for a bigger price in the next three to five years or anything like that.

    So that’s really good. So why would you, for someone that might be newer to investing that hasn’t really bought their first property yet, why would you advise them to invest in a multifamily property or real estate in general, opposed to other assets such as stocks or mutual funds or bonds?

     

    28:47

    Israel Oble: Well, you know, I personally have like all my money in Bitcoin. No, I’m just kidding. <Laugh> no, that’s a joke, man. It’s crazy how these markets have fluctuated and with like investments like cryptocurrency, you know, a lot of people talk about that being the new money, but we’ve seen how crazy this thing has crashed back and forth, you know, real estate, some of these buildings that I own, they’re going to be there long after I pass away. And my son and my wife are going to be able to hold onto these assets and that generational wealth factor comes into play again. There’s so many tax advantages to owning real estate as well. I just love it.

    I love to see something, you know, I love to actually see that it’s tangible.  You know, versus checking my phone every single day, my iPhone, just seeing how the stock market is doing and freaking out over my investments where like, as you had mentioned earlier, before forcing, being able to force appreciation onto your property, that’s powerful. Especially right now, if you buy like a house in SoCal and it has a garage, there’s an opportunity for you to convert that into an additional dwelling unit or a garage conversion. And essentially, you’re getting a duplex or even like buying a 10 unit out here in San Diego and just being able to renovate the whole interior and bring up the rents and you’re forcing value onto it, man, it’s powerful. And I foresee, you know, San Diego still being a strong market, despite all these downturns, it’s going to continue going up, man. It’s prime property, prime location.

     

    30:20

    Jason Lee: Definitely. The biggest thing for me that you mentioned is that you can actually see real estate. You can touch it, feel it, you can see it. So, I think that’s the biggest thing for stocks. It’s just like a number on a screen. And I personally don’t prefer that I prefer actually having more control over my asset, but the thing I really love about real estate is that you can negotiate anything. You can’t call the owner of apple and say, hey, I want to buy your stock at a discount. But in real estate you can call the owner and literally say, I want to buy your property for this price. It might be worth a million, but you could get a deal at 800,000. You never know they’re motivated to sell. So, I think that’s the biggest thing in building wealth with real estate.

    And also, there’s no other asset class that gives you appreciation cash flow, just passive income, huge tax benefits, and also principle pay down. We were paying down your loan and building equity. So, I think because those factors, I think everyone should own real estate. They want to not work the rest of their life. And it’s just kind of why I started the show. I think it’s just huge for people to know that, but for you, what is your favorite part about investing in real estate? Like what kind of gets you excited and motivated when you are looking at a property and like, wow, like I want to buy that deal because you know, blank really curious.

     

    31:31
    Israel Oble: You know, it goes back to generational wealth, man. Me personally, you know, I have an eight-month-old baby and I want to continue growing my family, just having that you know, financial freedom of having these cash flow and producing assets as additional income to my business and my current business ventures. The fact that I’m able to pass this on to my family long after I’m gone, that’s pretty powerful, man. You know, that’s how people build wealth in this country.

    And I’m super passionate about construction. For me as a kid, my dad would take me on construction jobs, and I would be digging trenches literally in Rancho Santa Fe. <Laugh> never knowing that it was one of the, the wealthiest places, you know, in this country. Ironically, I just slowly started loving it despite you know, that it wasn’t necessarily my first career. But I essentially went back to construction. There’s just a whole passion driven business behind building something, getting hands on. Now in my line of work, being able to, you know, create jobs for people.

     

    32:34

    Jason Lee: It’s huge, man. You’re good at what you do. So, keep it up. I mean, I can tell you’re very passionate about real estate and construction. So, keep doing what you’re doing. Kind of closing things out here. What is the best piece of advice you’d give to a newer investor or someone looking get in the space?

     

    32:47

    Israel Oble: You know, funny just how you mentioned it, once you get in it, it forces you, once you get into an investment property, it forces you to want to just start doing it, start figuring it out. You know, you’re going to figure it out once you get an investment property. I know a lot of people in this space, I have a lot of friends that own apartment buildings in San Diego, where at first, they just kind of bought the property and just along the way, they just started talking to the right people and it just kind of planned out, you know success is just kind of just showing up and doing it. It might take, you know, high risk, but then again, just make sure it’s calculated risk for certain stuff.

    But real estate, it’s always going to be your best bet, man. So, I mean, I absolutely love it and I just tell people to just do it, you know, <laugh> just get into it and you’ll figure it out along the way and don’t be that person that’s going to regret like, oh man, I wish I would’ve bought this property 10 years ago, five years ago. I regret not buying sooner. That’s one of my biggest regrets. Right now, we’re stretching about 50 doors, and I only want to be able to pursue and build more.

     

    33:54

    Jason Lee: Yeah, it’s a great answer. I think a lot of people get stuck in analysis paralysis where they’re costly just looking at properties, but like they never build the courage to make that first jump and buy their first property. Yeah. And think after you buy that first property, you kind of, all those fears go away. You kind of get used to how things work and how you have to plan the next thing. Of course, you’re going to make mistakes, but you’re going to learn from mistakes, and you’ll never make them again. So, it’s the biggest piece of advice I would give too.

    Another big thing you mentioned is I think that if you’re looking to get into real estate, you got to have the right mindset. If you’re doing it for, you know, for a reason that doesn’t get you motivated, you’re not going to like it because if you don’t actually like real estate and you don’t believe in the asset, you’re going to probably end up eventually weaning outta the business.

    But to piggyback on what you were saying. I mean, everyone, I talk to all my clients that I’ve worked with. Everyone says, I wish I bought more X number of years ago. I wish I bought more no matter where the market is, people, the best investors always tell me is there’s always a deal and real estate will always come back. So, if you just keep buying properties your life and you look at a long-term vision, you can’t lose. I mean, there’s, I promise there’s not one person you’ll ever meet in your life that says, oh man, I’m so mad I bought that property 20 years ago. They still own it because it’s probably doubled or tripled in value. So, it’s really good advice. So, Israel closing things out, where can the audience learn more about you and who you are?

     

    35:16

    Israel Oble: Yeah, absolutely. So, you can reach me at my website AIR, which is like Adam, Ida, Robert. So www.air-propertiesllc.com. You can also reach me at my Instagram, multi-family lion. So, @multi-familylion, I like to post a lot of my work there. I do a lot of daily stories, so you can see that I’m not a guru. <Laugh> like I’m actually posting real construction stuff. You can also find me on my LinkedIn, just my first name, Israel, last name Oble and, or my email Israel@oblepropertygroup.com.

     

    35:50

    Jason Lee: Awesome. Well, hey, thank you so much for your time, Israel and yeah, Hope to see you soon.

     

    35:55

    Israel Oble: Thank you, man. It was a blast dude.
    35:57

    Thank you for joining us on the multifamily millionaire podcast. The show that interviews, multimillionaire real estate investors and top producers in the real estate industry, we’re here to help you create passive income and achieve financial freedom so that you can do what you want whenever you want. We’ll catch you next time on the multifamily millionaire.

    [End of Transcript]

     

     

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