36) Adding Pickleball to Your Airbnb & How to Know When You've Got a Deal

Real Estate Investing with House Money

House Money Weekly

In this week’s House Money Weekly segment, Lauren and Alan get together with their special guest, Andrew Giancola, the host of The Personal Finance Podcast. They discuss blog 134, How do you know if you found a good real estate deal? Some investors don’t recognize a certain property as a good deal, and they just pass on it. A friend of Lauren’s sent her a deal and it’s a single-family home and it’s easy for her to say no because that is not her buy box. But that means it still could be a good deal for somebody else. Andrew used to make offers on 50 deals every single month on a lot of properties and if he ever won a deal that wasn’t in his buy box, he would still sometimes buy it, and those ended up being the ones he wanted to sell. Alan explained what a buy box is: the criteria that you invest in and if you keep a narrow niche and focus, you become an expert in that. You can easily recognize what’s an average deal, what’s below average deal and what’s a great deal. There are properties that are a great deal, but you need a narrow buy box to really recognize what deal is best for you. The next clue to finding a good deal is if you have insider information. Keep your eyes out for the opportunities that not everyone knows about. The last clue to finding a good deal is if your extended team agrees to that property. You can’t be a one man show in this, you have to rely on others whether it is a realtor or a mortgage lender, for example. Andrew shares ideas on his rental properties to his home inspector who is also a contractor. For Lauren, someone she would never ask is her parents.

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Mortgage Minute: Jasmine answers the question: What happens during underwriting?

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Real Estate Is Easy Interview

Lauren interviews Matt Ruttenberg, the Business Development Officer and Chief Marketing Officer for Life and Retirement Services. Matt explained that the turnkey options depend on what your priority is. The question they always ask for every single business owner and real estate investor is “is this for you or for your employees?” Another question is: “Are you doing this because the state is mandating you to have a retirement plan, or you just want to be able to recruit high quality employees?” If it’s for recruit and retain, then the turnkey option is great because it doesn’t care much about how it’s designed. If it says IRA, it means there’s not a lot of administration compliance needed. If it says 401(K), that needs administration and there’s a lot of money you can do. Lauren asks Matt how much money we really need to be able to retire. Matt explains the two subscription models to retirement: 1) a bucket of money and 2) cash flow. A lot of real estate investors are looking at the cash flow. When you subscribe to the bucket of money approach, there’s the 4% rule. So, if you have $1,000,000 then it would generate $40,000 income. Most business owners Matt speaks with are either in real estate or want to be in real estate. Lauren asks Matt to talk about the option of buying real estate using an IRA. Lauren shares her retirement strategy, and the components of her portfolio. Matt shares that real estate is easy because the amount of money you make per the amount of work you put in is fantastic. Alan and Andrew agree with Matt. Alan calls is return on headaches. Andrew calls it return on hassle.

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Vyzer Wealth Building Break: Litan answers the question: What do rich people think about equity?

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Guest Host's Segment

Guest Host Andrew talks about how a lot of investors are adding pickleball courts to their Airbnb and how it’s increasing the amount of revenue the Airbnbs generate. Andrew asks Lauren and Alan their opinions about the pickleball courts being added to Airbnb properties. Alan likes the idea of adding pickleball courts except on the pink pickleball court from a bachelorette Airbnb because if he's must turn it into a long-term rental or sell the property, they will appreciate a more neutral court. Andrew adds that these can double as basketball courts too. Adding sound barriers will lessen the noise when playing pickleball and it will help not to get complaints from your neighbors. Alan wonders about annoying neighbors with lights. Alan says he uses foul language, so having sound barriers would be necessary for him. For Lauren, although the payback period is huge when you add a pickleball court to your property, you absolutely need to have a cleaner or runner or PM who will maintain and will take good care of the court, paddles, balls, etc. Lauren also reminds hosts to consider the insurance aspect as well.

Article mentioned: https://time.com/6218672/airbnb-pickleball/

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