If you don’t have any money and wonder if you can become financially independent through real estate investing, listen to Bryan’s story. You will be inspired.
When Bryan first decided to be financially independent he was actually depressed and didn’t believe he could do it. He had a job and income but no money. Learn how Bryan got control of his financial situation then bought his first property and how empowering that was.
In only three years Bryan now has 5 properties and $2,700/mo passive income which has freed him up to pursue his entrepreneur interests.
Damon: All right. Well let’s get started. Bryan, I really appreciate you taking some time today to talk with me. Bryan Batson, here, is my guest today, and he is a successful real estate investor in single family properties. And I’m really looking forward to learning, Bryan, what your story is, and why you’re doing investing, and how you’ve been so successful at it. And I’m looking forward to hearing any advice that you have for the people that are watching.
So let’s go ahead and get started. And I guess the first question to help us get started here is, how long ago did you start investing in single family properties?
Bryan Batson: Oh, well, when I started when I considered investing, I would say, probably about five years ago. And then, I stumbled upon a group that provided the education and mentoring about four years ago, and I had bought my first property about three years ago.
Damon: OK. So once you had decided it was something that you wanted to do, it took about two years before you actually purchased your first property?
Bryan Batson: Yeah. I started looking for property just several months after I got really interested in it. I really did not know what to do. It was something that was very foreign to me. I had some decent knowledge about it, but I didn’t know where I could be making a mistake, and so that kept me from buying property. And plus, too, like many people, I started off with no money and no credit. And I was in college at the time, so I didn’t have that capability to buy.
Damon: OK, so that’s going to be really interesting. I think, to understand. You know, how do you get started with no money, no credit? How were you able to do that? I know a lot of people have that concern, “Can I even do this if I don’t have money and don’t have credit?”
Bryan Batson: You can. You can. But what I think the trick is for me, it was some fundamental issues fundamentals of finance and money management. I didn’t have those skills yet. I had a kindergartner’s level knowledge of money management. I had to cultivate that. I had to understand exactly where I was financially. And not just in my own head, but I had to actually write it down. I had to see where my income was coming from, which was pretty easy because I had a job at the time. But I had to see where my money was going, so I had to start keeping track of that.
And I don’t know if it was from family or not, but money was one of those taboo it was a taboo subject, so I was never really taught how to handle money properly. I knew different family members made money, but they always seemed to be living paycheck to paycheck, and I couldn’t figure out why.
But I took on the same bad habits, and I had to quickly take a look at myself and take a look at what I’ve been doing. And then, from there, once I had a clear shot, on black and white, on paper, I was able to get a hold of that and start turning that ship around.
Damon: OK. So turning that ship around, you went from not really having control of your money situation necessarily; you did have income. But once you got that control and managed it, and you could see where you were at, were you able at that point, then, to start doing what you could financially to prepare for investing? Was that your purpose?
Bryan Batson: Oh yeah. Yeah. Like I said, I joined a group about four years ago. I went to their seminar, and I realized that there was so much I did not know. At first, it got me depressed. Like there was a lot of fear in there, and it was like, “Poor me. I can’t do this.” And then, finally, after I got over my depression or whatnot, I’m finally like “OK, I can do this, but it’s going to take me a little not a little, but a lot of hard work.” A lot of reflection, and once I did that, I started to [be] able to save more money than I was actually bringing in, and fix some of my credit.
And that’s why it took me about a year to buy my first property. I bought it in my own. And the properties that I’ve bought since then have been with partners, using other people’s money.
But before I did that, I needed to know how to handle my own money before I started taking on other people’s money.
Bryan Batson: And then also how to manage money on a smaller scale before I started managing money on a lot larger scale. And I see that as I started getting to bigger investments, you know, started handling bigger portfolios that I need to have that foundation.
Damon: Yeah, that makes sense. So you mentioned that you were about for a year, there, once you saw, “Wow, this is something that I wanted to do,” but then you didn’t feel like you really could do it. You had some fear, feeling a little discouraged. What was it that enabled you to get over that fear and that discouragement?
Bryan Batson: OK, as far as getting over fear, I had read “Think and Grow Rich” and it talks about you’re the average of the five people you hang around with the most. Now I have a lot friends, but as far as business, I started taking advice from people who were successful who were doing what they said or what they teach and that helped me, pushed me over the edge to buy my first property. I kind of stopped listening so much to some my family members, even though they love me and everything, none of them have never really had any investments true investments or never had any really successful business.
So I started finding people who had what I wanted. And that really, really helped push me over the edge. And you know, I developed a relationship with them, and it wasn’t like a give take type of relationship. I always see what I can do to help them out in any way, shape, or form that I can, and I developed a good relationship. So that really, really pushed me over the edge.
You know, I have people I can talk to. I have a network now. I have people I can bounce things off of. I definitely believe in the abundance mentality, helping people out. That’s really what would help me get over my fear. And also, too, I mean, I’m not big on psychology and stuff like that, but it’s being OK with yourself.
You know, once you are OK with yourself, you can start doing things that at first seem really risky. Because, you know, everything is wrapped up in that one little thing you are doing. But then, you realize that you’ll be OK.
No matter what you do, you are able to look at things more clearly and to take risks. Because you’re not so much, I don’t know, not so much worried about the outcome. Well, you do have goals, but you know that you will be OK. You have a network that will help you out.
Damon: Right, so surrounding yourself with people that had accomplished what you wanted to accomplish. People that could help you do that inspire you, give you confidence that was really the primary way that you overcame that fear?
Bryan Batson: Yes, yes, definitely surrounding myself with like minded people.
Damon: OK. So do you remember when you bought your first house what kind of feelings you had as you were going to write out the check and actually put the money down? [laughter]
Bryan Batson: Man, my heart was beating fast. You know, I have never when I started with that group, which is Lifestyles Unlimited when I started with them, I had $2,500 and a 580 credit score. I saved up some money. You know, I saved about 10 grand. And so whenever I was coming to get that first property, I had to write a check for I think it was around $8,500, and I’m just like I was sweating bullets.
Bryan Batson: I mean, it was Oh man! And just thinking about giving that money up, and you know, just putting that on the line, it was a lot. Man, that first property! I tell people when it comes to investing the first property is going to be your hardest property because there’s a lot of fear and a lot of insecurity that comes up. Man, it was a lot of insecurity that’s coming out, financial insecurity. Am I good enough? Can I do this? The pit at the bottom of your stomach, you know? Just thinking about possibly losing that money.
And then also, whenever I was having contractors do work, I was sitting there, juggling money. I actually had just a little bit of money in my IRA. While I was going to get money back from what we call a “draw” in hard money, I still needed to pay my foundation guy.
And I wanted to pay him on time. I wanted to pay him quickly. So, I had to pull money out of my IRA to pay him. And then, next week I would get my draw to pay back the IRA. I was sitting there juggling money; and man, it was quite the experience!
Damon: That sounded pretty intense.
Bryan Batson: Yes, it was. It was. And so whenever you have I only had like $1,000 in the bank account, $2,000 in the bank account. That was the amount of wherewithal I had. [laughing]
Bryan Batson: It’s not very much.
Damon: Not much, but you pulled through. You got the deal. You bought the house. It needed some work. You mentioned you had a foundation guy, so it must’ve needed some foundation work.
Bryan Batson: Yeah.
Damon: Which scares a lot of people if they hear there’s a foundation problem. They’re like, “Ah, that may be something I can’t handle.” And yet, you took that on in your first property.
Bryan Batson: Yeah, yeah. Actually, I bit off a lot with that first property. We replaced the roof, replaced the condenser outside, foundation which these are all big things, so it ended up being quite a bit.
Damon: So when it was all said and done, you got the house fixed, you got it ready to rent out, to lease. And so, what was the result of all of that?
Bryan Batson: The results was, I got about $200 in cash flow. All the money…
Damon: Per month, right?
Bryan Batson: Yeah, a month. All the money that I put in, initially, I got back. At the time, three years ago, we were still able to do what you call a “cash out re buy.” So I was able to not only pull that money out; I pulled out an additional $8,700.
Damon: Above and beyond what you had put into the house?
Bryan Batson: Yes. So I have absolutely no money in the property anymore. It’s probably approximately $23,000 in equity in the property. So I went from $2,500, to a net worth of over $30,000 in one year.
Damon: So just doing quick math, I mean, that’s hundreds of percent increase in your net worth, just by that one transaction.
Bryan Batson: Yeah, I took a pay cut. I took a pay cut from the job I was working at when I first started, after doing the two day seminar. Then, from when I bought the property, it was two different jobs and I had taken like a I want to say it was around a $7,000 pay cut, $8,000 pay cut.
Damon: Wow. Some people are going to hear that and say, “Well, $200 a month cash flow, I mean, that’s not going to change my life.” So did that make any difference to you?
Bryan Batson: For one thing, that feeling when you get that first rent check, when you see it. I was charging my renter who has been there for the past three years, by the way he pays me every month. He pays me on time, now. To see $850 just come in, you know, that check, it was just the coolest feeling depositing that money, and only having to expense, whatever it was, $650.
Damon: For your mortgage, and your insurance…
Bryan Batson: Insurance, and taxes. I mean, that was the coolest feeling. And yeah, the $200 doesn’t seem like much, but then when you start accumulating more and more property, all that adds up. The $200, that was my first property. I know what to look for even better now. So I average, approximately $500 per month, per property.
Damon: Per property.
Bryan Batson: So that starts to get into a lot bigger income. Yeah and go ahead.
Damon: Yeah. So if you’ve been able to improve that as you’ve gotten more experience in doing this, can I ask how much cash are you getting from all your properties? How many properties do you have, and what’s your average cash flow per month?
Bryan Batson: OK, well, as far as the amount of properties I have right now, I have five. Five properties, but a cash flow of about $2700 a month, that’s tax free. For me, that’s more than I need to live off of. What it has done is freed me up. I’m not required to work at a corporate job anymore, so I can do what I want to. It’s allowed me to start some businesses online, where I couldn’t have done that before. It’s allowed me to go on trips to Bali, two week long, three week long trips to Colorado and stuff like that with the cash flow I have now. It’s also allowed me to get into some bigger avenues, which I’m exploring right now.
Damon: Wow, that’s awesome. That’s great. Just to recap, what I hear you saying is that first house with $200 a month cash flow, in and of itself may not have been a large amount of money, but it was so exciting to get that, to see that money coming in. And then you built on that, so now you’ve got five properties, almost $3000 a month income. And that’s passive income, right?
Bryan Batson: Mm hm.
Damon: You don’t have to work every day, all day long, to get that money so your time is free.
Bryan Batson: Real estate, especially single family, is not difficult. It doesn’t take a lot of time at all. When it comes to contracting, work, maintenance, stuff like that, I outsource all that. When it comes to acquiring properties, I have other people who look for the properties for me. I do the analysis, though. They look for the properties for me. I’m not sitting there scouring the Internet, driving all over the place looking for stuff. I’ve just built connections through different get togethers. You know, even going out at night, I’ll develop connections like that.
And that’s how properties will be sent to me. It does not take very much time at all. It’s just a matter of doing it the right way, the smart way, and having someone to talk to that’s been there and done that.
As far as when people ask me how much time I spend on my real estate a month, I would say approximately 30 minutes.
Damon: A month?
Bryan Batson: A month.
Damon: And that’s with five houses, right?
Bryan Batson: Yes.
Damon: Wow, that’s great.
Bryan Batson: Correct.
Damon: I’m going to have to cut this part out of the video. I had a question on my mind and it just… [laughing]
Bryan Batson: It’ll come up.
Damon: Maybe I’ll leave it in. It’ll make me look human, right?
Bryan Batson: Right. [laughing]
Damon: So I know that that is one of the concerns that people have when they are looking at doing this, is thinking, “Well, I’ve got a full time job, how can I get started and do this when I’m working?” and that sort of thing. So what is it that you do, Bryan, in order to spend so very little time working on this stuff, and yet generate such great income?
Bryan Batson: Well, let me rephrase something before. When it comes to acquiring a property, OK, let’s just say someone sends me some properties. Maybe I’ll book in about, I’ll allocate maybe 30 minutes in the morning OK, this is during the acquisition phase about 30 minutes in the morning or something like that to analyze properties that are being sent to me. If I find one, then I tell the Realtor, or Wholesaler, or whoever it was that sent it to me to send me a contract for the property. I want to make a bid. And that’s it. Then, I just chill out until I get word back.
I would say most of your time is put up front. It’s just a matter of allocating your time, maybe in the morning or the evening, to take care of that stuff. The process that I use, once I have a renter in the property, I hardly ever hear from that person.
So whenever I say 30 minutes per month, there might be months when I don’t do anything. To be honest with you, real estate can be kind of boring. Most of the time is me, up front, acquiring the property, putting a tenant in there and then maybe taking care of some odds and ends the first week they’re in there.
But again, I don’t lift a hammer. You know, I don’t saw…
Damon: You get other people to go in there and do that work.
Bryan Batson: Yeah. Exactly. Exactly.
Damon: So do you figure those costs in when you’re going through the acquisition process?
Bryan Batson: Oh. Yeah.
Damon: Factoring in that “I’m going to have other people do this work and not do it myself.”
Bryan Batson: Exactly. I treat it like a business. I don’t want to create myself another job. I want to have a scalable business. The more of me that’s in the business there is, the less I can grow. So I want to try and keep me out of it as much of me as possible. I will make certain decisions and evaluate certain things, but I have other people do the work for me.
Damon: I see. So your time is more allocated when you’re purchasing a property, going through the rehab and stuff. That’s where you’re spending time and you’re just more systematic about that. But once you get a tenant into the property, I think you mentioned that there’s not really a whole lot left to do. Is that correct?
Bryan Batson: Correct. See, for me, I acquired a property, I’m refinancing right now. It’s my fifth property, I’m refinancing. It already had a tenant in there. I spent like $300 doing some brickwork and and that’s it. It’s cash flowing $400 a month and it has around $30,000 in equity for about $6,000 down. Where was I getting with that?
Damon: How much time you spend once you have a tenant?
Bryan Batson: Yeah. The property I had before that was about nine months before that. Actually, it’s about a year before that. So I just collect checks now from those guys. I have one property I’m trying to give you instances of the time I spend I have one property, my tenant called me up and he wants to buy it. So I run my comps, which takes me a little time, and I gave him a price.
And then he asked me about the foundation. There’s some unsettling in the foundation. He wants to know what it would cost to fix it. So I’m like, “OK.” I called up a list of contractors, three of them. I told them to go out there and check it out.
“Here’s my tenant’s phone number. He’ll open up the door for you, so you can go and do your thing.” They get back to me with the bids and now it’s time for me to look over those bids, which won’t take very long.
Bryan Batson: And I’ll give whoever the go ahead to fix the foundation. So, it’s very little time.
Damon: I see.
Bryan Batson: Make a couple of phone calls. Get people squared away and get them on task, and that’s about it. But that time between, I bought this last property I have, that I’m refinancing, and the time before I mean, there was no acquisition. There was no having to do rehab or put tenants in there, so I really wasn’t doing anything as far as real estate. What I was doing was starting to learn and research about another business that I been wanting to start. So I was able to focus my time on that, while the real estate just runs itself.
Damon: I see. I think that’s a goal that many of us have is we want to get to that point where the real estate runs itself, so we can do other things that we want to be doing.
Bryan Batson: Exactly.
Damon: So is there anything special about you, Bryan, that has enabled you to be successful at real estate investing, that maybe the average person wouldn’t be able to do? How do you see yourself in that way?
Bryan Batson: I’m really stubborn and hardheaded. [laughing]
Bryan Batson: It’s just a willingness to try new things and to listen to other people. That’s probably the biggest thing. I’ve been willing to take risks. And through those risks, I’ve won some, I’ve lost some. I’ve learned from those experiences. That’s really what I think is basically, for me, that’s it. You know, I think I have above average intelligence. Through the risks I’ve taken, I’ve learned to be more of a B personality. I’ve learned how to analyze things.
Damon: A B personality, meaning more analytical?
Bryan Batson: More analytical, where I was just a ready, fire, aim, type person. You lose a couple of dollars off of that, and you learn how to settle down.
Damon: Settle down a little bit, calculate, analyze?
Bryan Batson: Yeah. Actually, I bounced all the way to the opposite side. So I got paralyzed for a little bit. Now I’ve learned how to analyze what’s truly necessary and kind of leave out the rest. And I learned how to do it as quickly and effectively as possible, so that I can make decisions faster.
Damon: OK, so you’ve been doing this for several years now. Have you made any mistakes? And can you cite a mistake that you’ve made that you would do differently?
Bryan Batson: Yeah, I’ve made plenty of mistakes. For instance, my first property, I was trying to skimp a little bit on the rehab. One of things was plumbing, and also the condenser unit outside. I thought it could last a little bit longer. I wanted to kind of push it a little bit, instead of fixing it right up front before I got a tenant in there. What do you know? Air conditioning went out on the first sign of a little bit of heat outside. And then, the plumbing, it sprung a leak. So all that, I had to fix anyway. So next time, for me, I try to get everything I can fixed up front. Anything that can go wrong during the term of the lease with the property, I get it fixed up front so that I won’t have to be dealing with that when the tenant is in the property.
Damon: Right. OK. And you mentioned that you have partners that you’re working with now. What advice could you give people based on your experience? How do you partner up with somebody, and do it in a way that makes it work?
Bryan Batson: What I tell people about partnerships, any kind of partnership you have to bring something to the table. You have to figure out what that is what you bring to the table or what you need, and you have to be able to balance that out. No one is just going to give you $100,000 or $150,000. You have to exhibit something of value for them to do that. What I recommend people do is to make a list of their assets, not just money or credit or anything like that. But what resources, as far as time, knowledge, experience, can you bring to the table.
Be able to write that down. Be able to have a resume. If you’ve done properties before, be able to show the returns. Have honest returns on there, because you’re going to have to sell that to someone else.
Also in partnerships, you’ve got to realize when you partner up with someone, you’re married to them, essentially. You have to weigh that out, as well. Is this someone that I actually want to work with for the next 3, 4, five years, potentially? Is this person going to bug the heck out of me? You have to weigh that out, too.
One of my partners in real estate, he’s a really good guy. He’s an older gentleman. He has knowledge in real estate, and he has a background in real estate, and he has the money. And for me, he used my income, and my credit score, and my knowledge and resources, and we bought property.
But the great thing about him is if I need to go out or do something, or I want to go do something like for instance, when I went to Bali last year, I was gone for three weeks, and I turned my phone off.
Damon: And he just took care of things for you and you didn’t have to worry about that?
Bryan Batson: Yeah, just in case anything happened. And actually I had a rehab going on at the time. And I gave him the rundown of what was going on, and I left it up to him. And so, I went out, and did not have to worry about being near the properties while I was gone on the trip.
Damon: Right. Awesome. Can I ask, so how do you set up the partnership so that you both benefit? How have you set that up?
Bryan Batson: Well, for me, I did a simple, for just a single kind of partnership, or a two person partnership, I made it real simple. What I did was actually go online and look up some simple partnership agreements. I worded it to fit our partnership, then I had a lawyer look over it. And what I should have done at first, and what I’ve done since then, was actually have my CPA look over it as well for tax ramifications.
Bryan Batson: So that’s what I did for the single kind of partnership. Now if I were to take on more partners, or if I go after bigger deals, especially in multi family, that’s all going to be lawyers. I’ll have them draw that up, that’s going to be a little more complicated. I like to try to keep things simple as possible though.
Damon: So what tips do you have for somebody who’s just getting started in real estate? Maybe they already know this is something they want to do. They’re motivated by doing what you’ve done and becoming financially independent. So that you don’t have to work at a job and you can do what you choose. What advice would you give to somebody in that position?
Bryan Batson: Repeat that question one more time. Sorry.
Damon: That’s OK. So what advice would you give somebody who’s just starting out in real estate investing? They know they want to do it. Maybe they have some fear and concerns, and they’re not sure if they actually can do it. But just at the beginning stages of this, what advice would you give them?
Bryan Batson: Well, there are books to read and those always help. I would definitely find a mentor. I really would find a mentor and qualify these people. Are they the people that have what you want? Are they trustworthy? What kind of feelings do you get about them? Pay attention to that. Those are people that you can start listening to. But ultimately, it’s going to be your responsibility. One of the things I did, especially when I was ramping up my real estate, I’m a big proponent of the “Four Hour Work Week..” And one of the things it talked about was writing down the absolute worst things that can happen if you were to pursue this avenue that you want to take. And what are the absolute best things, life changing things that will happen to you if you were to do this and it became a success.
And so, once I started to write all that down and really tried to figure out what is absolutely the worst thing that could happen to me. How life changing was it? Could I easily get myself out of it or be able to go back to the same existence that I had before?
And I started to realize that it wasn’t nearly as bad as I thought it was, so it allowed me to push forward. And with the knowledge I’ve been getting from reading. For me, I joined another group and was asking members questions, asking mentors questions and soaking up information like a sponge.
That’s definitely something that I would recommend. And then, one more thing is to really get a good understanding of your financial well being to understand where you’re at. Keep tabs of that.
Damon: Makes sense. So you mentioned books. You read “The 4 Hour Workweek” by Timothy Ferriss, is that correct?
Bryan Batson: Yes, Timothy Ferriss.
Damon: Are there any other books that you read that you could recommend?
Bryan Batson: Yeah. One of the fundamental books is, of course, “Rich Dad, Poor Dad.” That will definitely change your paradigm, and “CASHFLOW Quadrant.” Those are basically all the books you need to read from him because they start to say the same stuff, just packaged…
Damon: In different ways, yeah.
Bryan Batson: Yeah. “Think and Grow Rich” is a really, really good book. I actually recommended it to somebody today. I read that about three or four times before I bought my first property. That was something that really, really helped me out. Those are probably the main books. I know Stephen Covey’s pretty good with his “The Seven Habits of Highly Effective People”; that’s a good book. It was a little dry for me, but I got most of that. But my recommendations, to keep a long story short, “The 4 Hour Workweek”, “Think and Grow Rich”, “Rich Dad, Poor Dad”, and “CASHFLOW Quadrant”.
Damon: Excellent. So in your experience, how much knowledge did you have to have before you were ready to go out and start investing?
Bryan Batson: I had to have a base knowledge, which is what I learned through the group I was in, just the basics. Where you’re really going to learn is when you get out there and start applying the things that you’ve learned. Your experience is where you’re going to learn 90% about real estate. I tell people, “You didn’t learn how to ride a bike in the classroom, did you?” and that’s the case here. You can learn some theories and the basics about real estate, but it’s not until you get out there, and then go through that spectrum of emotions. And whatever issues then come up, you have to do problem solving, and that’s when you really learn.
Damon: That’s when it really happens and comes together. A lot of investors that I talk to that have been successful, they say the same thing that you’re saying. And that is, sure, go get some level of fundamental knowledge. But you’re really not going to learn what you need to learn until you just go out there and do it. And in my experience, real estate is forgiving enough. And as you mentioned too, you’ve made some mistakes, and yet, you’re still successful. So you’re going to make mistakes. But it sounds to me like you don’t really need to worry about that in the sense of worrying that you’re going to lose all your money. If you have people to work with, and they’re showing you and helping you, and you make some mistakes, you can still do it.
Bryan Batson: Um hmm. And one thing, too, and this might scare people, but I’ve gotten to the point that through my experience and the knowledge that I have now that I’ve acquired, if I were to lose it all today, I’m pretty confident in myself in being able to get myself on my feet, dusted off, and be able to go at it again. It’s what I have up here now that really is what’s valuable.
Damon: And that’s such a great place to be because you feel confident, and you have this belief that you can do it, and I know so many people want to achieve that. And I really appreciate your time today, Bryan, to talk to me, and help people out that are watching this. You’ve done a great job in the last few years being successful at investing, and becoming financially independent. And it’s a great story, and it’s a great model for us to follow. So thank you very much.
Bryan Batson: I really appreciate it. It humbles me.
Damon: Thank you. All right. We’ll talk to you later. Take care.
Bryan Batson: OK, Damon. Bye.
Damon: Bye, bye.