Joseph Cornwell is a full-time real estate investor, general contractor, and podcast host with a diverse background in law enforcement and real estate. Born and raised in Milford, Ohio, Joseph served as a police officer from 2012 to 2021 before fully transitioning into real estate. Since 2016, he has sold over 175 properties totaling nearly $70 million in volume, while building a personal investment portfolio of 135+ rental units across single-family, multifamily, mixed-use, and new development projects. In 2017, he launched ROS Construction LLC to handle major renovations and now leads a team of 15 full-time employees completing over $3M annually. Joseph also owns Realty One Stop, offering sales, leasing, and construction services, and is a host on the Best Ever CRE Podcast, the industry’s longest-running daily real estate show.
Here’s some of the topics we covered:
- How a Cop Became a Full-Time Real Estate Investor
- Turning a Side Hustle Into a Real Estate Empire
- Vertically Integrating Your Company & The Positive Effects
- The Trump Tariffs & How It Affects Real Estate
- What’s Really Driving the Surge in Prices Right Now
- Why Picking the Right Asset Class Can Make or Break You
- The Window of Opportunity Opening in Multifamily
- The Challenges of Working With Counties and Cities
- Why Moving at Your Own Pace Is the Real Superpower
- The Wildest Story From Joseph’s Days as a Cop
To find out more about partnering or investing in a multifamily deal: Text Partner to 72345 or email Partner@RodKhleif.com
Full Transcript Below
00;00;00;08 – 00;00;16;18
Rod
So do you ever get stuck? You know, maybe you’re stuck knowing you need to make a decision to improve your life, but you’re just continually putting that decision off. So many of us stay stuck in a life we don’t love, working at a job we don’t love, or sometimes even in a relationship that’s lost love and we stay in.
00;00;16;18 – 00;00;42;24
Rod
We don’t make a decision because of fear or because of limiting beliefs. And we stay stuck because we’re comfortable sometimes as well. What many people don’t realize is that their life changes the moment they make a committed decision, and stick with it. Now, if you’re in indecision, indecision has been around your finances, and maybe you’ve been on the fence about pushing forward in your multifamily investing career, then I want you to do everything you can to push off that fence.
00;00;42;26 – 00;00;57;09
Rod
I’m going to do everything I can to cause you to do that and make a decision. And it’s a simple decision that’s just to come to one of my virtual boot camps. I’ve got one coming right up, and I promise you’ll be glad you did. My two day virtual boot camp frankly, kicks butt, and I don’t sell anything there.
00;00;57;15 – 00;01;14;14
Rod
You’ll love it. The price is ridiculously reasonable, and you’ll learn what you need to know to buy multifamily. And just as importantly, I hope you make that decision to actually take action with what you learn. You know, I get thank you notes and messages and emails and DMs from people literally every day telling me that they took action on their dreams.
00;01;14;14 – 00;01;36;13
Rod
And I want one from you. So make a decision. It’s not about the money, because the tickets, like I say, a ridiculously reasonable. It’s just about committing the time to immersing yourself for two days in this exciting business and taking action to create the freedom you deserve, your family deserves. Text the word bootcamp to 72345 or go to Rod’s Boot camp.com right now and I’ll see you soon again.
00;01;36;13 – 00;01;41;22
Rod
Text boot camp to 72345. All right, let’s get to it.
00;01;41;25 – 00;02;07;21
Rod
Welcome. This is the life time cash flow through Real Estate investing podcast. This is where you’ll learn strategies to help you achieve lifetime financial freedom through real estate investment. Your host, Rod Cleve, has owned over 2000 homes and apartments, and he brings experts in all aspects of real estate investment and management onto the show. Now here’s your host, Rod Cleve.
00;02;07;24 – 00;02;23;22
Rod
Welcome back to lifetime cash flow through real estate investing. I’m Rod Cleef, and I’m thrilled you’re here. You’re really going to enjoy today’s podcast interview with a gentleman named Joseph Cornwell. And, he is one of the hosts of the best ever show, which is, Joe Fairless, a show. And I’ve been on there a couple of times.
00;02;23;22 – 00;02;44;17
Rod
He’s been on this show a couple of times. He’s a big hitter in the multifamily space, and he’s he’s got a podcast where they literally go every single freaking day. So I think he got burned out and he brought in other people, and he and he’s of friends with Joseph here. And and so Joseph’s a host there. So, Joseph, I’m going to rather than butchering your bio, I’m going to just have you, well, welcome number one.
00;02;44;17 – 00;02;55;20
Rod
Thank you. Yeah. And I’m just going to have you, kind of give us your background and why real estate and why now? You’re a host of a of a big podcast. And, yeah. Bring us current.
00;02;55;27 – 00;03;05;13
Joseph
Yeah. So, I mean, I started in, real estate back in, I guess, 2011 technically. So I did a live in flip first home. Just regular residential buyer.
00;03;05;13 – 00;03;06;00
Rod
Good timing.
00;03;06;00 – 00;03;20;27
Joseph
Yeah. You know, I was 21, so I bought my house early, you know, kind of compared to a lot of my generation and my friends and things like that. But I basically made the decision like, hey, I don’t want to go out and buy or rent an apartment and waste money on rent. I didn’t know much about money.
00;03;21;03 – 00;03;33;25
Joseph
I didn’t have a lot of money. Didn’t come from a family with a lot of with a ton of money. But, you know, I knew enough to say, okay, well, back then, you know, 3 or $400 or whatever I was going to pay on rent in Cincinnati. That’s where I’m from. Grew up Cincinnati, still live there.
00;03;33;27 – 00;03;46;22
Joseph
You know, I was like, I know throwing my money away on rent is not a good idea. So if I can qualify for a house, that’s probably a smarter move. That’s about as much as I knew about real estate is I didn’t want to, you know, throw my money out running. So I bought my first house, fixed it up myself.
00;03;46;25 – 00;04;01;11
Joseph
If you remember those old Home Depot manuals where you could learn how to drywall and frame it. No kidding. Yeah. So this is kind of right at the YouTube was starting to become popular, but, I remember going to Home Depot and buying my first, you know, materials from my house, and they would give you, like, a book when you checked out.
00;04;01;18 – 00;04;08;05
Joseph
So, you know, I was reading a book and basically fix up that first house, a lot of DIY and kind of learned as I went.
00;04;08;05 – 00;04;08;26
Rod
How old were you then?
00;04;08;29 – 00;04;09;15
Joseph
21.
00;04;09;15 – 00;04;10;14
Rod
21 and 21 when.
00;04;10;14 – 00;04;25;02
Joseph
I bought my first house. Okay. And so I, same time I was actually just coming out of a police academy. So I got a two year degree, went to police academy and fixed up that house, went into my, career as law enforcement, started up part time, got a full time job. And as.
00;04;25;02 – 00;04;25;20
Rod
A patrolman.
00;04;25;20 – 00;04;28;14
Joseph
Yes. Yep. For how long? I was a police officer. Ten years total.
00;04;28;14 – 00;04;33;24
Rod
Before kidding, I say, well, I want to say it, but I want to hear some crazy stories there. So let’s go back to that. Yeah.
00;04;33;24 – 00;04;52;15
Joseph
Okay. So so, yeah. Basically, I lived in a house for three years. I sold it, and I think I made like $41,000 just off appreciations. And, and and I looked at it as, okay, I have no idea what’s happening in the market. I don’t know anything about real estate. All I know is I kind of bought this old lady’s house and, you know, modernized it a little bit.
00;04;52;17 – 00;05;13;27
Joseph
And I made, I made about probably 70, 80% of what I would have made in a year as a cop on accident, you know, selling to live in flip. And that was what really opened my eyes to real estate. And I’m like, if I actually educated myself, learned about this business, I there’s could be something here. You know, in the early on when I was a police officer, I think I looked at real estate as a path that just kind of had my retirement.
00;05;13;29 – 00;05;27;24
Joseph
You know, I’ve told the story a lot of where when I was about 25, I looked around and I saw a lot of older police officers who were, you know, in their 50s or even 60s that were still working, you know, they’d been divorced three or 4 or 5 times. You know, divorce is very prevalent in the law enforcement.
00;05;27;27 – 00;05;29;05
Joseph
And,
00;05;29;07 – 00;05;31;01
Rod
I why is that, by the way?
00;05;31;04 – 00;05;34;15
Joseph
Well, it’s long hours, you know, it it changes you as a person.
00;05;34;22 – 00;05;36;07
Rod
You know, bring the work home. Right.
00;05;36;07 – 00;05;42;20
Joseph
The dismissive it’s exactly, you know, it’s a you get very cynical, you get very pessimistic. Not everybody, but generally.
00;05;42;20 – 00;05;46;29
Rod
Speaking see how that could happen? I mean, you guys had to have to deal with so much crap.
00;05;47;01 – 00;05;59;18
Joseph
Yeah. Let’s just put this way, if you if you look at a lot of, you know, 56 year old police officers who’ve been in it 25, 30, 40 years, yeah, very few of them are healthy, happy and and, you know, right happy person. Let’s put it that way.
00;05;59;19 – 00;06;00;03
Rod
It’s a.
00;06;00;03 – 00;06;01;19
Joseph
Shame. So I had a good I had a.
00;06;01;24 – 00;06;07;23
Rod
It’s good work and it’s necessary. Absolutely. Yeah. Yeah. This whole defund the police thing made me want to freaking bang my.
00;06;07;24 – 00;06;14;05
Joseph
Yeah. Well I got lucky. I got out in 21. So I was able to kind of get out the right time. As things were start had already kind of started going down that hill.
00;06;14;10 – 00;06;15;20
Rod
Sorry. No no no no.
00;06;15;21 – 00;06;34;17
Joseph
Yeah. Yeah. So I looked at it as, okay, I’m 25, I’m in this for going on five years. I have a lot of examples of what I don’t want my life to look like in 30 years. And and that was kind of something I’ve noticed about my whole lifetime is I had a lot of experiences where I’m like, I don’t want to do that, or I don’t want to be like that, which.
00;06;34;19 – 00;06;35;24
Rod
So those can be good lessons.
00;06;35;24 – 00;06;36;07
Joseph
Yes.
00;06;36;07 – 00;06;45;23
Rod
It helped me. Yeah. You know, I mean, I have t shirts in my bootcamps. I give out, let’s say, hashtag, ask me how I know because I’ve made every frickin mistake you can possibly make, you know? So yeah, keep going.
00;06;45;26 – 00;07;01;29
Joseph
So yeah. So I, you know, that opened my eyes between between the career. Five years in selling my first personal residence. Right. I was like, okay, there’s something here that I need to dive into. And then that’s when I got into the real estate education space. You know, I found Biggerpockets. I found some of your content.
00;07;01;29 – 00;07;17;28
Joseph
I found best ever content. I met Joe Fairless, he had a local meet up in Cincinnati. That’s where. That’s where he lives now. You know, and so all these things kind of dominoes started falling that led me down this path of, okay, how do I actually make money in real estate? How do I make this at a bare minimum?
00;07;17;28 – 00;07;22;24
Joseph
How do I make this a side hustle? And then, you know, as Mike, what you did, which that’s how I saw.
00;07;22;26 – 00;07;26;14
Rod
It for another five years. Exactly. So what did you do? Start flipping what you start doing.
00;07;26;14 – 00;07;48;15
Joseph
So I looked at flipping, but I didn’t like it because I looked at it as just another job. You know, I thought it was a could be a well-paying job if I knew what I was doing, and maybe if I did it at scale. But to me, it was not a whole lot different than trading time for money unless I built it into this mass of scale where, you know, I could hire all the right people and, you know, not have to trade my time for the money and all those things.
00;07;48;17 – 00;08;08;25
Joseph
So that didn’t really make sense or appeal to me at that time. This is 2015. Let’s say. So buy and hold made a lot more sense. And so I started working with a couple local real estate agents, and I quickly realized that most real estate agents don’t know anything about investment property. No, which I wouldn’t have assumed that, you know, going into.
00;08;08;25 – 00;08;09;10
Joseph
Right.
00;08;09;13 – 00;08;27;00
Rod
Right. And, you know, what’s interesting is a lot of, on that note, you know, I teach this at my boot camp. Is that, you know, if you’re going to buy multifamily in a particular market, get in line with a broker or an agent, because, very often a multifamily property will hit the local MLS and they’ve got a freaking clue what to do with it.
00;08;27;00 – 00;08;44;20
Rod
They don’t know how to price it because, you know, if somebody bought a house from someone, after they built or bought a ten unit, 20 unit, 30 unit, but they bought a house from a realtor, they assume that realtor knows how to sell that ten, 20 or 30 unit, and they haven’t got a freaking clue. They don’t know how to price it or anything else, and you get some phenomenal deals that way.
00;08;44;20 – 00;08;45;28
Rod
So anyway, just.
00;08;46;01 – 00;09;02;17
Joseph
That’s exactly what happened. So I reached out to like a couple of agents I went to high school with. I reached out to the guy that helped me buy my first house. I reached out to the agent that I bought my second house with and I, you know, worked with them. They were showing me some, some rentals and I’m like, I don’t know anything about real estate, but I know more than they do.
00;09;02;17 – 00;09;03;25
Joseph
And that was and that was.
00;09;04;02 – 00;09;04;14
Rod
Eye opening.
00;09;04;18 – 00;09;12;27
Joseph
An eye opening experience. Right. So I’m like, you know what? If this is the bar of what’s out there in our market for for investment realtors, I’m going to go ahead and get my license.
00;09;13;03 – 00;09;33;29
Rod
So I was just going to ask if you did that because then you’ve got access to the MLS. You get commissions I did this what I did, I mean, I keep bringing this back to me. I am sorry about that. I, I actually, hired a broker to legitimize a brokerage. And because, you know, you have to have a broker, and but I if I did a deal, I got all the commission.
00;09;33;29 – 00;09;45;29
Rod
I had access to the MLS, and I paid this guy a monthly fee, and it worked out really well for me. So I didn’t want to get my broker’s license again. I was a broker when I was 18, but that’s smart. So you went I got a licensed. Yep. So my access to the whole inventory of properties exactly.
00;09;46;04 – 00;09;56;22
Joseph
Got my got my license in Ohio. So, started in 2016. Then I started looking for my own deals, you know, sharing my own. And I, I made a bunch of offers. And, you know, at the time, I’m still working as a cop.
00;09;56;28 – 00;10;03;14
Rod
But you weren’t really out there selling, selling other people’s houses, you know, whatever, just to facilitate your investment. We’re same same, same.
00;10;03;14 – 00;10;23;23
Joseph
Yeah, right. It was never my intention. Now what? Yeah. I’ll get into what happened, but that was never my intention. So then I start looking, I start making offers. And the whole time I’m, you know, at the time, I’m maybe saving 500 bucks a month, you know, between my bills over time, details, you know, off duty details, maybe I’ll come up with 500 bucks a month.
00;10;23;23 – 00;10;40;15
Joseph
And I’ve been doing this for a couple from your police. Paid. Exactly. Yep, yep. And so it took me about probably 18 months to. I actually found the right deal, made an offer and got it accepted. And I watched this property get listed and it was in the city I worked for. So I worked for, a small suburb of Cincinnati.
00;10;40;22 – 00;10;44;13
Joseph
It’s a little city named Deer Park. It’s like 5500 people, one square mile.
00;10;44;13 – 00;10;45;06
Rod
Well, that’s small.
00;10;45;06 – 00;10;47;22
Joseph
You know, kind of like Mayberry. So, you know, from from.
00;10;47;24 – 00;10;48;12
Rod
00;10;48;12 – 00;11;04;05
Joseph
Nice. What’s the show, Andy Griffith. Right. So it’s very similar. I mean, everybody knows everybody, you know, a little, little tiny town. Well, I knew this house. They got listed. Nobody’s going to buy it because I had actually arrested some of the tenants inside of it, and it was a little duplex. And I’m like, this thing is trashed.
00;11;04;07 – 00;11;22;03
Joseph
They’re hoarders. Nasty drug addicts, all that stuff. And so I watched it sit on the MLS and drop about $30,000 in list price. And I think they listed like 120 or 130 originally. So I end up buying it for 89,000. And that was all the money I had in the world. And then I get into this thing and I’m like, oh crap, I actually need money to fix this, fix it.
00;11;22;06 – 00;11;40;10
Joseph
A lot of money. I never even thought about that. I mean, that’s how little I knew, but that wasn’t even a consideration. Wow. So I borrowed some money from from my stepdad, paid him interest, fixed it, got it rented out, paid him back. And then about a year later, I refinance at first property and timing.
00;11;40;13 – 00;11;57;02
Joseph
And in a perfect where I actually just happened to find a six unit that was closer to where I live. I’m on the East side of Cincinnati. So I made an offer on the six unit, and I use that cash out refi kind of bird. That first duplex got my cash out, plus a little bit extra, and I use that as my down payment on my second property, which is a six unit.
00;11;57;08 – 00;12;01;14
Joseph
And I honestly just that was really the best. Kept rolling it. I just kept rolling and I did, you know.
00;12;01;17 – 00;12;20;07
Rod
So bird, by the way, if there’s anybody doesn’t know what that is, it’s by Renovo refinance repeat where you just you just keep doing the that model. And in fact we do it with large deals but large deals as well. Yeah. So so you kept rolling it. And then, you know, I just noticed in your bio that you did actually sell as an agent for a while.
00;12;20;12 – 00;12;22;04
Rod
Yes, for quite a while. Nine years.
00;12;22;08 – 00;12;45;17
Joseph
Yeah. So and ultimately as that pattern, you know, from, let’s say 2017 all the way up to 2021, so there’s about 4 or 5 years there where I was just bearing properties. I buy a couple of a year, you know, as I went on, they were more scale and more volume and things like that. As the money had grown, the and I and I had no intention of this, but I started kind of just documenting what I was doing.
00;12;45;17 – 00;13;01;08
Joseph
So started with like Facebook, meaning I’d take some pictures, I’d write a post, and it was I had no like and I didn’t even know enough to think, oh, if I do this, I’m going to ultimately find partners, I’m going to raise capital, or I’m going to find better deals like none of that was the intention was strictly like, I think this is kind of cool.
00;13;01;11 – 00;13;13;20
Rod
To tell my story. Yeah, same. You know what’s interesting? I’m sorry to keep you, your team here, but I did the same thing with this podcast. Yeah. When I first started it, I took three phone calls from my listeners. I had hundreds of them. 30 minute calls. I’m not going to sell you anything if I can add value.
00;13;13;20 – 00;13;26;05
Rod
And I know that helped this thing grow in a big way. And, and that, you know, and I used to say early on in the podcast, I’ll never sell you anything. Now, I’m a freaking liar because I sell everything, but I never I never plan to, you know, we want to make God laugh. You tell me your plans.
00;13;26;05 – 00;13;31;05
Rod
Yeah, but. So. So you started posting on social media. Started. You started getting a following. Yeah. Assume and. Yeah.
00;13;31;06 – 00;13;47;21
Joseph
Well it was it was a lot of just friends and family. But it it ultimately led to both of to I have three businesses right now but two of them are the real estate sales and the construction. The really it’s kind of one umbrella to two departments under one company, really, but whatever. From an entity structure, it’s separated.
00;13;47;24 – 00;14;01;03
Joseph
But it’s it literally was just me posting, this is what I’m doing. And then people reaching out like, man, that’s really cool. You know, I love these these properties. You know, you buy these really kind of crappy properties. You’re making them look nice during the before and after and kind of showing our.
00;14;01;09 – 00;14;02;26
Rod
Did that build your construction business.
00;14;02;26 – 00;14;03;06
Joseph
Yes.
00;14;03;07 – 00;14;07;10
Rod
So you got investors to to work with you to get these to do flips and things like that.
00;14;07;11 – 00;14;17;00
Joseph
Yeah. So we do our construction business now. We do a about half of our own projects are in multifamily, mixed use commercial whatever and about half contract work.
00;14;17;00 – 00;14;19;25
Rod
Are you a GC. No. Yes. Okay. So your your general commercial.
00;14;19;25 – 00;14;29;01
Joseph
Yeah. We have a construction company and really want to stop construction and really want stops like my overall brand. And that we do sales as well. Still. Okay. Excuse me I don’t I don’t hire agents.
00;14;29;03 – 00;14;31;17
Rod
But you’ve got 15 full time employees in the.
00;14;31;19 – 00;14;33;28
Joseph
Countryside and we have one full time admin on the real estate.
00;14;33;29 – 00;14;36;21
Rod
So yeah. Yeah. Good for you, man. You’ve vertically integrated.
00;14;36;21 – 00;14;53;13
Joseph
Everything’s perfectly. You manage our own portfolio. And, you know, part of the way I built this out in my mind through the years as I continued scaling, was if I’m going to ultimately take money from either partners or limited partners as investors, I want to make sure I am able to touch every aspect of this process.
00;14;53;13 – 00;15;19;18
Rod
And maximize and maximize cost savings. Yes, what you’re able to do with your own company. Now, and I’ll tell you, by the way, vertically integrated guys means where you don’t just buy properties in a specific market. You manage them, you have the construction component, you do all the pieces. That’s called vertically integrating. And I will tell you, the most successful operators I see in this business, are geographically specific and they vertically integrate ultimately.
00;15;19;20 – 00;15;20;07
Rod
So it.
00;15;20;07 – 00;15;44;26
Joseph
Seems to be a lot more popular now. Like so when I, when I started and again, I’m not going to act like I’m some genius. All of this just organically kind of grew. I almost kind of went where the, you know, the winds take you, but I think the mindset behind that was, one day I’m going to continue scaling where I am going to raise capital, and I never want to go to my investors and say, you know, we lost money on this deal because our property manager, you know, they ripped us off or they just stunk, which, you know, which.
00;15;44;26 – 00;15;45;27
Rod
Is very common.
00;15;45;27 – 00;15;46;23
Joseph
You know, you know, is.
00;15;46;23 – 00;15;51;18
Rod
Very kind. Interview I’m dealing with it right now on a couple of assets personally. Exactly. So, you know, bad managers.
00;15;51;18 – 00;16;00;29
Joseph
But it’s also a very common thing you hear when you’re talking to investors across the country is, they have I don’t want to make excuses, but you have all these reasons why deals go bad, you know?
00;16;01;01 – 00;16;29;17
Rod
Well, there’s a lot of a lot of deals going bad right now, as you well know, not just because of bridge debt and whatnot. But, you know, expense ratios have gone through the roof. We are payroll going up with the cost of expenses going up. And, you know, I’d love to talk to you about the tariffs because, you know, we pre frame that a little bit before we started recording that that might be a good topic because you know as it sits right now there’s a 90 day hold on the tariffs with the 70 countries that have come to the negotiation table.
00;16;29;18 – 00;16;38;05
Rod
Yes. But Canada and China know, because they’re playing hardball, and which is stupid, but, you want to speak to that a little bit? Your thoughts on that? Yeah.
00;16;38;05 – 00;16;53;29
Joseph
I mean, so the way I’m tracking this is obviously if, if and when and how bad the tariffs ultimately end, which, you know, we don’t really know. It’s a lot of volatility right now in the discussions and negotiations and all that. But I think the way it’s going to affect us on the real estate side is definitely through the construction.
00;16;54;02 – 00;16;56;04
Joseph
You know, part of my business now I’ve.
00;16;56;07 – 00;17;03;10
Rod
Yeah. Unless unless he unless he wins. Sure. You know unless he unless he it turns this around which I believe he will.
00;17;03;13 – 00;17;07;14
Joseph
Yeah. And that’s the thing right. We don’t we don’t know how bad it’s going to be. We don’t know how long if or.
00;17;07;14 – 00;17;08;15
Rod
If it’s even going to do that.
00;17;08;15 – 00;17;16;11
Joseph
Yeah. If at all. Right. Right. So it’s it’s very volatile. The problem with you know volatility in the market like as we all know like we’ve seen with interest rates.
00;17;16;12 – 00;17;46;18
Rod
We’ve seen it with the ten years has gone way down and pop back up. But I think I just saw today had the biggest stock market gain in history in history. When he when he announced the 20 the 20 I’m sorry the 90 day pause. But it’s very volatile and I think that volatility is going to get people to realize maybe they should get their ass out of the stock market and focus on real estate, which, you know, I love to say this, you know, we’ve got inflation and I don’t know if you know this.
00;17;46;18 – 00;18;11;10
Rod
In the last four years, 80% of the US currency was created up to 2020, only 20% it was in circulation, another 80% was created in the last four years. And we wonder why this inflation, you know, that’s what caused it. But here’s the thing with the beautiful thing about what we do in real estate is when you buy an asset, your debts fixed and in our assets are based on a multiple the net income, as you know, and, and rents are going to keep going up.
00;18;11;11 – 00;18;14;24
Rod
Yeah. And so is our net income. So so is our values. Yes.
00;18;14;24 – 00;18;33;16
Joseph
So yeah inflation you know I’m saying. So back to the tariff thing. The issue with concerns with tariffs for me are a couple things. It’s going to be how would how does it ultimately impact inflation. If it you know if it is a long drawn out battle. Obviously again we don’t know how long. We don’t know. We don’t know if it’s even going to happen.
00;18;33;17 – 00;18;33;24
Joseph
Yeah.
00;18;33;24 – 00;18;47;08
Rod
You know to what extent. So like China for example. I mean they’re kind of painted themselves in the corner. I just read that to do with Xie that, you know, if he capitulates, it makes him look really bad to the rest of the Communist Party. So he’s kind of painted himself into a corner. So we’ll see what happens.
00;18;47;14 – 00;19;05;18
Joseph
That’s right. And, you know, as we know, a lot of our material comes from China today. A lot of our lumber comes from Canada today. So, you know, you can look at lumber futures. They’re way up, you know, and that’s part of back to the real estate construction thing. It’s like when we’re bidding jobs right now. Like we’re we’re bidding a couple, big custom garage builds in Cincinnati, which we’ve done it.
00;19;05;19 – 00;19;09;13
Joseph
We did a few last year, and it turned out great. The problem is I have no idea how to price.
00;19;09;14 – 00;19;09;27
Rod
In the cost.
00;19;09;28 – 00;19;18;09
Joseph
You know, it’s like we’re so we’re giving people like a 30 day estimate and it’s like, hey, we have no idea what’s going to happen if we don’t sell your project for six, nine, 12 months. We have no.
00;19;18;09 – 00;19;20;00
Rod
Need to buy the material right freakin now.
00;19;20;00 – 00;19;24;22
Joseph
Yeah, that’s that’s that’s a smart thing to do, too. I mean, that’s that’s something one way you can try to get ahead of.
00;19;24;23 – 00;19;41;25
Rod
Yeah. The guys that you don’t know if you saw the guys are built rebuild my doc and I told him I’d really like to go from wood to a composite planking on there because then my, my maintenance guy doesn’t have to stain it every, every year. Right. And they said that his pricing on the planks went from 65 to 120.
00;19;41;26 – 00;19;47;27
Rod
Wow. He’s trying to negotiate something with me, but, you know. Yeah, it’s it’s already, impacting.
00;19;47;27 – 00;20;01;23
Joseph
Well, that’s what happens, right? These these, you know, importers, whether they’re wholesale, whether they’re the actual retailers, they have to price in what they think is going to happen. Right. So people get upset about inflation. Well, a lot of inflation is guessing what’s what, what’s coming. You know, we don’t really know.
00;20;01;23 – 00;20;23;08
Rod
Well, you know, I will tell you in my opinion, the proverbial stuff needs to hit the fan only because, you know, we’re $36 trillion in debt in this country. And, you know, we’re we’re barely paying the freaking interest on that debt. And so, you know, I think I think a recession is likely, candidly, and I think it’s probably a good thing that there needs to be a reset.
00;20;23;10 – 00;20;40;14
Rod
I mean, it’s been glory days and, and, you know, people get scared about, oh, recession or, or whatnot. But, you know, with crisis comes opportunity, right? And if you look at it like that, you look at it, your glass is half full. When that happens, then there’s a potential incredible opportunity. It could be a big transfer of wealth.
00;20;40;16 – 00;20;43;00
Rod
I don’t know how you feel about that. No good degree. Disagree. Whatever.
00;20;43;00 – 00;21;00;03
Joseph
No, I think I think that in general all of that is, you know, accurate. And that’s I mean, I one thing I like about my market in the Midwest, you know, speaking about is more stable. Exactly what you’re talking a little bit about that, you know, before we started the show, it’s like we didn’t have that huge 30, 40% rent bumps.
00;21;00;03 – 00;21;01;08
Joseph
You know, in most of our neighborhood.
00;21;01;08 – 00;21;02;15
Rod
Do you say you’re in Cincy or Cleveland?
00;21;02;15 – 00;21;03;01
Joseph
Cincinnati.
00;21;03;02 – 00;21;03;22
Rod
Oh no kidding.
00;21;03;22 – 00;21;28;24
Joseph
Yeah. So it’s it’s we don’t have that volatility. You know we we are a very slow growth market. We do have positive population trends a lot of that’s from you know immigration legal and illegal immigration. But it’s it’s a situation where even if we do have a pretty significant recession that I think is an accurate, you know, I think that that is a good possibility, right, that we’re not going to have that huge fall off that.
00;21;28;26 – 00;21;49;19
Rod
You didn’t back in 0809. Right? I’ve got, by the way, have several assets in Cincinnati. I know, probably over a thousand units. I was thinking Cleveland in my head. I was thinking Shaker Heights, but but Cincinnati, I’m very, very familiar with we’ll talk about that offline. But, okay, so, and there’s a lot of rundown properties in Cincinnati.
00;21;49;21 – 00;22;04;26
Joseph
Certain neighborhoods especially. Yeah. I mean, that’s I think that’s the way I look at Cincinnati. And you can, you know, you can take this exact same ideology to a lot of these Midwest, you know, cities, right, where.
00;22;04;28 – 00;22;12;09
Joseph
When you pick your neighborhood class, you’ll get obviously rent bumps, right? When you go to that kind of class up to the A class or B class or whatever you.
00;22;12;09 – 00;22;12;23
Rod
Buy in D.
00;22;12;23 – 00;22;17;22
Joseph
Class. I have one built in my 40 unit. I would probably call that a C minus D plus, I mean, but that’s part.
00;22;17;23 – 00;22;21;11
Rod
Area or pretty area. Yeah. Yeah I, I’m sure I’ve that’s.
00;22;21;11 – 00;22;21;24
Joseph
Probably my.
00;22;21;24 – 00;22;23;11
Rod
Learn my licks on those. Yeah.
00;22;23;11 – 00;22;32;20
Joseph
That’s probably my roughest neighborhood I’m in. But what I, what I think you’re really deciding there is how challenging to your tenants. I mean, that’s the biggest.
00;22;32;22 – 00;22;50;08
Rod
That’s it. That’s the whole enchilada right there. I mean, you know, I’ve had D-class properties where where they cut a hole in the front door to pass the crack through. Okay. Where people got killed behind it, around it, in front of it. You know, where where they where the cops blocked off the street to slow down the drug traffic, not stop it, just slow.
00;22;50;10 – 00;22;51;13
Joseph
Down where they got to go to their car.
00;22;51;13 – 00;23;10;24
Rod
And walk. Oh, yeah. Yeah, exactly. Make it a little more, inconvenient. Yeah. You know, and and I wouldn’t wish that shit on anybody. Yeah. Okay. You know, life’s too short for that brain damage. You know, your collections are terrible. They destroy the units. Yeah. You know, typically, you know, there’s a lot of functional obsolescence in that demographic with the properties themselves.
00;23;10;24 – 00;23;29;04
Rod
Rooms are too small, ceilings are too low, windows are small, you know, and and there’s just a lot of deferred maintenance typically. Yeah. And, you know, a lot of turnover and it’s just a lot of work. And so I try, I try to talk people out of buying C minus D, even C right now because that demographic is getting killed right now.
00;23;29;11 – 00;23;46;06
Rod
You know, I, I’m single and I never had to buy groceries before. And I’m like, Holy crap, that’s a lot of money. Yeah. And filling up my car and things like that. I never thought about that. But it it’s I don’t know a lot of people, you know, I don’t know how some people make it candidly. And that’s so that c demographics getting their butts handed to them right now.
00;23;46;06 – 00;23;46;16
Rod
Two.
00;23;46;17 – 00;23;47;14
Joseph
Absolutely.
00;23;47;16 – 00;23;48;11
Rod
But
00;23;48;13 – 00;23;58;01
Joseph
That’s and so that’s, you know, to your point with that and that’s my concern with inflation. I love inflation as we all know, we own assets. You know, that’s that’s how we grow our wealth through our in our assets.
00;23;58;03 – 00;24;00;29
Rod
It’s not it’s not pleasant. Yeah. For for for tenants.
00;24;01;00 – 00;24;13;05
Joseph
My concern is after the big run up we had to last four years. If this trend continues, if we still see high inflation in the next four years, let’s say where does the music stop for our tenants. Yeah.
00;24;13;06 – 00;24;31;23
Rod
That’s market. Yeah. And their income has to increase. You know, everything has to increase. And I, unfortunately, I hope I’m wrong, but I think it’s inevitable that those things are going to happen. Yeah, but, you know, a lot of pain will come in conjunction with all that. Yeah. We’ll see. You know, maybe, maybe some of this stuff.
00;24;31;23 – 00;24;35;25
Rod
Trump student can can thwart that. Maybe these tariffs can help with that I don’t know.
00;24;35;27 – 00;24;36;15
Joseph
Yeah.
00;24;36;17 – 00;24;40;01
Rod
It’s it’s way way beyond my economic expertise. But
00;24;40;03 – 00;24;40;20
Joseph
Well that’s the.
00;24;40;27 – 00;24;41;21
Rod
Fascinating though.
00;24;41;24 – 00;25;11;17
Joseph
That’s a that’s the challenge for investors right. Is that we we the last couple of years we have been in just a, a cycle of volatility, you know, ups and downs and unknowns and you know, interest rates and inflation and all these other things that we have no control over. You know, that’s when you go back to the fundamentals of real estate, you know, reason why I chose to invest in real estate ten years ago instead of stocks or bonds or whatever else is that I, I knew I had some modicum of control over real estate.
00;25;11;19 – 00;25;26;20
Joseph
Well, all of these things we’re talking about are the aspects of real estate you can’t control, right. And that makes it inherently uncomfortable, you know, because, you know, these aren’t things you can put your hand around. These are things you just got to ride the wave and do it, do I believe?
00;25;26;20 – 00;25;44;18
Rod
Oh, you you you go in conservatively, you go in conservatively, you raise more money than you think you need. You just do every stress test like crazy. I haven’t bought an asset in the last year. 14 months. I’m about anything. Yeah. Just because it’s still crazy, but I believe deals are coming in a big way. I mean, I was looking at assets, a couple of weeks ago.
00;25;44;18 – 00;26;00;28
Rod
They’re selling for the debt. A bunch of them. A bunch of big multifamily complexes selling for the debt. They still don’t make sense with the interest rates. So these lenders are going to have to take haircuts. But when they do, I think there’s going to be some incredible opportunity. But but you still going conservatively, you know, pie in the sky stuff.
00;26;01;02 – 00;26;01;20
Rod
Do you agree.
00;26;01;20 – 00;26;14;17
Joseph
Yeah, absolutely. And and you know, the problem with I agree. Absolutely what you’re saying, but these are the same conversations we’ve been having, like on the Best Ever podcast for the last two years, because two years ago, people thought these deals were coming, you know. No, I.
00;26;14;17 – 00;26;22;01
Rod
Know and I know and and then, then they’re like, oh, you’re full of shit. You’ve been saying that for three years. And I get that hate all the time. But the bottom line is it’s going to happen. Yes, it has to.
00;26;22;02 – 00;26;22;16
Joseph
Is a matter of.
00;26;22;16 – 00;26;40;03
Rod
Winning. Yeah. And that’s what it has to unless the rates come way down. Yeah. There’s you know these these days lenders, the catchphrases extend and pretend you know, they’re doing deferrals and loan modifications and trying to keep these properties off their books. But at some point, you know, I, you know, read a lot of commercial real estate news.
00;26;40;10 – 00;26;48;28
Rod
And, you know, they’re talking that they’re finally starting to foreclose and take some of these properties back, and they’re going to have to discount them to sell them. Yes. They can’t stay on their books, I think on their balance sheet.
00;26;48;28 – 00;26;54;14
Joseph
I think that’s the main question. You know what, when, when how big of, you know, how many defaults when.
00;26;54;14 – 00;27;13;29
Rod
There’s so much debt that’s due right now? There’s so much debt that’s in trouble right now. It’s it’s it’s it’s staggering. I mean, I hear my, you know, my, SEC. Attorneys totally focused on loan workouts and foreclosures right now. And he, you know, like he got 3 or 4 foreclosure clients last weekend, you know, big multifamily properties.
00;27;14;02 – 00;27;14;28
Rod
And so, yeah.
00;27;15;03 – 00;27;30;05
Joseph
And I think a lot of this with, you know, like you said, the lenders, a lot of these lenders have their head in the sand. I think a lot of this is back in, you know, 0708 when when the market started falling out, the lenders just jumped and took everything that they, you know, everything you missed two, two loan payments.
00;27;30;05 – 00;27;32;16
Rod
They it was it was mostly single family.
00;27;32;17 – 00;27;33;21
Joseph
Right. It was a lot of single family.
00;27;33;21 – 00;27;35;15
Rod
This is this is different I mean these are.
00;27;35;20 – 00;27;51;19
Joseph
But even on the multifamily side the in commercial where they took assets, I think the lenders quickly realized, oh we suck at this. We don’t want to manage these properties. We would rather renegotiate a worse deal for us to let these, you know, operators get to manage. Yeah. Right. And that’s own ultimately.
00;27;51;24 – 00;27;56;17
Rod
I think you’re dead on with that analysis. Actually, I think you’re dead on with that because I’m seeing that. Yes.
00;27;56;21 – 00;27;57;14
Joseph
I think that’s why I lenders.
00;27;57;14 – 00;28;05;08
Rod
We’ve got a portfolio in Cincinnati that my ex partner ran into the ground and I and and that lender has been kicking the can down the curve.
00;28;05;11 – 00;28;05;26
Joseph
Because they don’t want.
00;28;05;26 – 00;28;21;18
Rod
To take some. Sometimes I’m surprised by it. Candidly. Yes. I’ll talk about that more when offline. But, just because you’re there. But yeah. No. So let me ask you this. What do you think is your superpower in this business that has contributed to your success?
00;28;21;20 – 00;28;43;27
Joseph
Yeah. So I tell people all the time, my biggest strength is that I’m willing to buy the properties that nobody else wants. And I look at that lens not from a location standpoint, but from a, this the amount of value and need it. You know, I have done, you know, structural foundation. It’s, I’ve bought deals where we had to do additions to make it work, you know, same.
00;28;44;01 – 00;28;44;24
Rod
Same same in all.
00;28;44;24 – 00;29;02;17
Joseph
The we, you know, we raise the roof on the third floor instead of like, oh, when there’s a dormer, that’s a big one, you know, things like that. We’re making full size units, things. So I bought, I bought a duplex in a little town called Norwood in Cincinnati you may be familiar with, but it’s it was, the entire main beam of this building.
00;29;02;23 – 00;29;14;14
Joseph
It’s actually a triplex had collapsed, so it we, you know, we had to lift the house up, replace all the beams. So just deals like that, you know, the last ten years, at least in my market.
00;29;14;17 – 00;29;15;20
Rod
Well, you don’t have any competition.
00;29;15;20 – 00;29;33;12
Joseph
Yeah, these are ones that are sitting on MLS or in a loop. Net. Maybe they’re off market, whatever it may be. And it’s it’s a it’s a competitive advantage because 99% of investors out there aren’t going to touch it, right. You know, or they don’t have the experience or they don’t have the means or they don’t have the team, whatever it may be, there’s something holding them back from making this deal.
00;29;33;12 – 00;29;54;00
Rod
You know, what’s interesting is I’ve got a friend. I haven’t talked to him in a long time, but he had a business replacing gas. Oil tanks up in the northeast where they have oil, oil, furnaces and all that, and and these things would leak and nobody would buy them because of the EPA issues. And he and he got some phenomenal, I mean, same, same kind of a dynamic.
00;29;54;07 – 00;30;17;29
Rod
Nobody’s going to buy them. But he’s got the business to replace the tanks and clean it up. And so he cleaned up on a bunch of houses. Yeah. But interesting. So, you know, you’ve you’ve been at this a while. You know, I, I love to talk about setbacks, and I call them seminars. Would give us an example of a of of a doozy, you know, where you got your ass handed to you and maybe the lesson involved.
00;30;17;29 – 00;30;18;27
Joseph
Oh, absolutely. So I’m.
00;30;18;27 – 00;30;21;05
Rod
I we have tons of them because I’ve done some. But yeah.
00;30;21;05 – 00;30;28;06
Joseph
So I’m working on a deal right now. It’s a pain in, say, five unit in Northern Kentucky, a little city called Covington. Oh.
00;30;28;07 – 00;30;29;09
Rod
Because you’re right over the border.
00;30;29;13 – 00;30;50;27
Joseph
And so it’s, you know, this is ten minutes from downtown Cincinnati, right across the river. The deal itself fundamentally is is fine. There’s nothing wrong with the intrinsic numbers of the deal. I didn’t buy it wrong, anything like that. The problem with this deal is what I found out after the fact. So lesson learned. I didn’t do enough research of the local zoning building department.
00;30;51;00 – 00;31;05;09
Joseph
Because there’s a little town right next to it called Newport. And, you know, it’s a big levee on the river. It’s, you know, kind of a touristy thing, where I had heard the horror stories of that building department. A lot of people don’t go there. They’re terrible to work with. They fight you on everything. But Covington didn’t have that reputation.
00;31;05;16 – 00;31;22;09
Joseph
So I buy this building with a partner, and it took us almost a year to get our permits on this building. So the problem is the city of Covington, who’s actually good to work with because they want to see preservation like this was a shell vacant shell vacant for years. They wanted to see something done with this property.
00;31;22;11 – 00;31;30;26
Joseph
The problem was the county is the one that ultimately issues all the actual construction, permitting. They don’t get they don’t care. They don’t care. I don’t know if you custom the shelves about to.
00;31;31;01 – 00;31;33;24
Rod
Oh, I guess we could have a good time.
00;31;33;26 – 00;31;54;22
Joseph
So. Yeah, they don’t they don’t give a shit. Right. So it’s like you’re you’re you’re. And here’s the problem. You. I picture like a Venn diagram. Right in the middle is where they agree. Well you got to get everything on this on this project. And in that middle and that middle is real small. Well, so what the historical and the city level want and what the county and the building permit level one totally different things, right?
00;31;54;28 – 00;32;12;27
Joseph
So it’s almost impossible to get them to agree on actual permitting plans because they want different things. So you can imagine from modern building code, which is the county level, they want everything to be you know, like type three B construction. You know, they use the national building code. Well, when you’re talking about 125 year old building.
00;32;13;00 – 00;32;13;23
Rod
Yeah.
00;32;13;25 – 00;32;28;11
Joseph
A lot of that doesn’t apply. And you can’t make it apply. There’s not even a way to retrofit it to apply. Right. So, huge lessons learned on the permitting side, and even with all my construction experience up to that point, is the deal I bought probably two years ago. I mean, we’re just now getting ready to drywall.
00;32;28;11 – 00;32;29;08
Joseph
No kidding. I mean.
00;32;29;08 – 00;32;29;28
Rod
Finally.
00;32;29;28 – 00;32;34;25
Joseph
So I, you know, I’m taking a hit on the holding costs. Obviously, I’m taking a hit on,
00;32;34;27 – 00;32;35;29
Rod
Well, you’re building materials have.
00;32;35;29 – 00;32;47;11
Joseph
Gone building material costs, all those things just for the project that gets delayed out that long. You know, and part of it’s my fault. It’s not just all these other things. I mean, I’ve been inundated with all these other projects. I’m sure I didn’t.
00;32;47;11 – 00;32;48;08
Rod
Give it to you.
00;32;48;08 – 00;32;50;03
Joseph
Kind of just. Yeah, gets put on the back burner.
00;32;50;03 – 00;32;53;11
Rod
And when your focus is diluted, it, it impacts everything.
00;32;53;11 – 00;32;56;28
Joseph
Well, and it’s like when it’s when it’s pulling teeth to do anything, you don’t want to deal with it.
00;32;56;28 – 00;33;14;24
Rod
Yeah. You know, I mean yeah, it becomes a stepchild. No, I get it completely. Yeah. Whenever you’re dealing, by the way, with the city or county, always follow up your follow up, your verbal communication in writing by email and get acknowledgments because they they change their freaking minds. And I’ll tell you, they didn’t say you.
00;33;14;28 – 00;33;18;11
Joseph
And and find out who was involved. That was my mistake. So I met with the city.
00;33;18;12 – 00;33;18;23
Rod
Okay.
00;33;18;23 – 00;33;36;04
Joseph
So I did that part. I thought I was had my bases covered because the city was great. Oh, we’re so happy you guys are buying this. You know, this been on our condemn list for years. Whatever. You know, the they were very supportive. Whatever you need. What you need help with. What I didn’t know was that they only approve a very small subsection of these permits.
00;33;36;04 – 00;33;49;00
Joseph
And everything else goes to the county. It’s Kenton County or Kent County. Like I said, they don’t give a shit. They don’t care if you do it or not. They’re not getting anything out of it other than whatever the permit fee. So they fought us tooth and nail on every single thing we wanted to do to this property.
00;33;49;02 – 00;33;52;20
Joseph
Like I said, it took us over a year. Part of that was hired the wrong architect. There was a lot of was there.
00;33;52;20 – 00;33;54;18
Rod
A good old boy component to all that?
00;33;54;20 – 00;33;56;20
Joseph
So what we learned working with our architect.
00;33;56;22 – 00;34;00;04
Rod
You know, sometimes you see that in a municipality. There’s a good old boy now.
00;34;00;04 – 00;34;19;22
Joseph
Well, so they do have their, their, you know, kind of golden child, which like, you know, in some neighborhoods we are that guy. So it’s great. Right? So it’s I mean, I’ve been on both sides of that. Right. But it’s, it’s what I learned working with this architect is we over disclosed, what the way things get done here in this little niche is they just don’t tell.
00;34;19;25 – 00;34;30;26
Joseph
They just do it. Just do it. And then. And if they call you out on something. Okay. Yeah, we’ll get it drawn up. But a lot of this is smart. It’s kind of a don’t ask, don’t tell thing. Gotcha. We went into this like, here’s everything.
00;34;30;26 – 00;34;34;06
Rod
We open the kimono. And that was the mistake. We were.
00;34;34;08 – 00;34;35;18
Joseph
Extremely transparent.
00;34;35;21 – 00;34;36;13
Rod
That’s very helpful.
00;34;36;13 – 00;34;37;00
Joseph
To a fault.
00;34;37;00 – 00;34;42;22
Rod
And guys that that’s very valuable information if you ever do large projects. Okay. Well, that’s.
00;34;42;26 – 00;34;53;03
Joseph
You gotta you gotta learn to play the game within within that little neighborhood you’re in. Everyone’s different. I wish I could give you some catchall advice, but it’s you’ve got to learn how to play their game. Yep. That’s that’s.
00;34;53;03 – 00;35;10;28
Rod
Yeah. You gotta kiss ass. You’ve got to go in there and meet them and let them see you and all that. So, you know, I get a lot of listeners, like you do on your podcast that, you know, want to do this business. They want it. They want to do what you’re doing. They have a 9 to 5 job.
00;35;10;28 – 00;35;27;05
Rod
Maybe they’re a police officer, by the way. Thank you for that. That’s good work. You know, they they or they’re, you know, who knows it? Their their, own their own business, whatever it is. But they know they need more and they want to do this on the side. What advice would you have for them?
00;35;27;07 – 00;35;47;09
Joseph
I think if you want to build a path out of your job, just like I did, you have to do it at whatever level you’re comfortable. You know, I, I, I’ve seen people who’ve tried to do that and they go really big and then maybe they fall in their face. And as you know, having done small and large deals, if you make a mistake on a small deal, it’s a lot easier to come back from.
00;35;47;09 – 00;36;01;28
Joseph
Maybe you’re talking 10 or $20,000, you know, even an average, you know, career. You can work your way out of that mess, right? If you make a big mistake on a big deal, $2 million deal, you mind all of a sudden that $500,000 mistake you got to pay for that could be a life changer, right? So I could be.
00;36;01;28 – 00;36;04;06
Rod
It could be a business life ending.
00;36;04;08 – 00;36;18;09
Joseph
Yes. Right. Yeah. Maybe you go bankrupt or, you know, ruin your reputation or whatever, right? A lot of bad things can happen. So my advice is always you have to you can only go as fast as you’re comfortable and and I don’t want to say that every day you should feel comfortable. Because every time I step.
00;36;18;09 – 00;36;19;10
Rod
Every time you go bigger.
00;36;19;10 – 00;36;20;28
Joseph
Yeah. You should. You better.
00;36;20;28 – 00;36;28;16
Rod
Be right. Especially if you’re showing some fear. You know, like I say, the, you know, life of your dreams is just on the other side of some comfort. Exactly right. Know you’re going to get uncomfortable.
00;36;28;16 – 00;36;42;14
Joseph
Especially if you’re raising money or you you know, your partner with people. Yeah, you. If you don’t feel a little scared doing this business, then something’s wrong with you right now. I mean, that’s that’s my perspective. But as far as, like, if you’re building a path out of your career, you got to take those baby steps and build up.
00;36;42;14 – 00;37;00;08
Joseph
You know, I started with a duplex, and then I went to a six, and every step along the way, it was a little more complicated, a little more scale. But that led me into better deals because I now had more experience to build off. I felt comfortable doing off market. I felt comfortable buying sight unseen. I felt comfortable partnering with people that were putting capital into my deals.
00;37;00;11 – 00;37;10;01
Joseph
And like I said, the deal we’re working on right now is the first one to actually syndicate. But again, ten years ago, I would have never felt comfortable raising $2 million. I had to grow.
00;37;10;03 – 00;37;17;29
Rod
Sure to get to interesting to get to that point. And I’ve heard different answers to that question. So how do you feel about education if someone wants to get into this?
00;37;18;02 – 00;37;36;20
Joseph
Oh, I mean, education’s everything. Like I said, I, I, I am stubborn, so I, I’ve never paid for courses, I’ve never paid for coaching. I’m, I am the type of person that, I would rather learn the hard way, which I have over and over and over and over. But I don’t think that I wouldn’t, I wouldn’t give anyone that advice.
00;37;36;22 – 00;37;37;04
Joseph
I yeah.
00;37;37;08 – 00;37;57;15
Rod
I don’t, I don’t, I don’t think, man, I’m glad because I don’t know why you pay for speed. You pay for what you pay for to minimize those mistakes. So you don’t have that $500,000 mistake, you know, and, and, you know, I was leading this question because, you know, I’ve got a coaching program, and I boot camps and yes, you know, my students own somewhere around 250,000 units that we know of.
00;37;57;21 – 00;38;16;22
Rod
It’s probably more than that. And, and, and so, you know, I obviously I’m a big proponent for education, and, and love it and love what I do. And, and I think it’s, it’s a must have. I didn’t do it when I was building this thing and bought 2000 houses. I never did any education. Do you know what you’re stubborn like, man.
00;38;16;26 – 00;38;21;10
Rod
But yeah, I was. Well, there wasn’t much available. Candidly, I’m a lot older.
00;38;21;10 – 00;38;22;03
Joseph
It’s a lot easier now.
00;38;22;05 – 00;38;43;20
Rod
Yeah, but. Yes, but, But I’m. I mean, I show this this, picture at my boot camps where I’ve, I’ve got, like, hundreds of lanyards around my neck and on my arms and, you know, from all the boot camps and the masterminds and the, you know, workshops that I’ve gone to and, you know, that’s that’s the education and that’s the peace and there’s, there’s so much special.
00;38;43;20 – 00;39;09;06
Rod
I mean, I’m in coaching right now. I’ve got a relationship coach. I had a speaking coach for a Ted talk I’m going to do. And you know, I believe in education. It’s not just me trying to sell education. I really I, I eat my own cooking, you know, and and I think you have to be a reader as well, you know, I mean, so my library downstairs, you know, that’s, that’s, that’s, I think critical that you, you’re continually educating yourself, you’re continually curious and I can tell you are.
00;39;09;06 – 00;39;10;18
Rod
Yeah. And.
00;39;10;21 – 00;39;12;23
Joseph
That’s why I’m here. Yeah. That’s why I had this conversation.
00;39;12;23 – 00;39;27;01
Rod
Yeah. You know, it’s. And guys, I like this guy because, you know, I asked him why he was here. And usually there’s an agenda. You know, I’m trying to raise some money. I need some this or that. You just, you know, want to get out there and add value. And I just have a lot of admiration for that.
00;39;27;03 – 00;39;43;04
Rod
You know, usually there’s an agenda and there was no agenda with you. So I really admire that. So in this journey of yours, tell me about any moments you had or epiphanies, you know, that were like, Holy crap, now I get it. Okay. What comes to mind? You may have already do we may have already addressed a couple.
00;39;43;04 – 00;40;02;03
Joseph
Yeah, I was here, so I mean, I think the most Life-Changing epiphany I’ve ever had, especially when it comes to, you know, this path I ultimately went down was, was like I said, when I was about 25, I realized, I there’s a lot of examples in my world that I don’t want to be gotcha. And that that was a huge motivation of, like, I’ve got to change my life.
00;40;02;09 – 00;40;17;19
Joseph
And if nothing else, I’m going to pad my retirement. But ultimately, I ended up building a path where I could replace my income with cash flow and get out of my day job. And again, that’s not what I set out to do. Actually, my initial goal 2015, I remember writing it down a little like a napkin. My goal was, I want to have ten units in ten years.
00;40;17;25 – 00;40;18;22
Joseph
And I thought that was like.
00;40;18;26 – 00;40;19;01
Rod
Oh.
00;40;19;01 – 00;40;32;12
Joseph
Yeah, next. Like, holy crap. Like, how would you even do that again? This before I even bought a property rental property. And so I think I hit that in like two years, you know, once I once I started buying. So I was like, okay, like this is doable. I can build this path out. So that was a huge epiphany.
00;40;32;14 – 00;40;51;14
Joseph
I think the second biggest one and this is more of a personal thing. Yeah. But so I had my first I was married and we had our first daughter in 2017. We did a divorce in in 2019. Guy with my, my new, fiancé. We had our we had our first child, my second in, I think we found out she was pregnant.
00;40;51;14 – 00;41;01;17
Joseph
Let’s say 21. I guess it was right before I left, but that was the big catalyst for getting out. So as you mentioned, we all know what happened in 2010.
00;41;01;17 – 00;41;07;07
Rod
We got a divorce while you were still a police officer. And then and then they then in 21 they did all this defund the police.
00;41;07;07 – 00;41;25;23
Joseph
Exactly. So so I started, you know, starting in 2020. Right? I saw the writing on the wall with the way the country was going. Yeah. You know, there was a lot of animosity towards police, you know, law enforcement around the country. I already felt underpaid and unappreciated, you know? And then it got worse. I realized my businesses were making more money than my than my career.
00;41;26;00 – 00;41;43;19
Joseph
So it was like this from a math standpoint, just does make sense to do this anymore. I was working 50 hours a week as a cop and 20 hours a week on my businesses and making more money than right. And both in my job. Right, right. And so one thing that really stuck with me, as much as I loved being a cop and I love the departments I work for, and I miss all the guys I worked with.
00;41;43;22 – 00;41;50;29
Joseph
I remember when I took two weeks off for my first daughter being born. Yeah, it was like the end of the world. I got so much crap.
00;41;51;01 – 00;41;53;08
Rod
You mean from from? Yeah, just from the department.
00;41;53;08 – 00;42;07;12
Joseph
You know, it was in the summer. I was messing on people’s vacations, and it was something that really stuck with me of like, man, this is a really important thing in my life, right? And it had to feel guilty the entire time. I’m not at work. That was one of those moments of why I was like, I need to.
00;42;07;15 – 00;42;14;18
Joseph
I yeah, I built a blueprint here. I need to figure out a way to actually get get out of here, make a real plan.
00;42;14;18 – 00;42;33;27
Rod
So you build a blueprint that’s, that’s that’s really important. You know, and, and, you know, and I think and then just to talk about my warriors again, you know, we give a blueprint because you got to have a plan, you know, fail to plan plan to fail. Right. You you need a plan. You need a blueprint. And, and that’s awesome that you did all this yourself.
00;42;34;00 – 00;42;41;18
Rod
So what drives you? I mean, what gets you to jump out of bed and you know, and do what you do? I what’s the why?
00;42;41;23 – 00;42;54;25
Joseph
You know, I think for me, it, people ask me this, and I don’t I wish I had, like a very clear cut answer, but I think the simplest way is I had a great lower middle class life growing up. So I don’t want to take anything away from my parents. And they did absolute best they could for me.
00;42;54;27 – 00;43;06;06
Joseph
Right. And I had a great childhood, right. But I knew even as a child that I wanted to do more for my kids. I wanted my kids have a better opportunity than I did. And again, I’m not, you know, I’m not going to say so.
00;43;06;07 – 00;43;06;26
Rod
It’s about the kids.
00;43;06;26 – 00;43;20;14
Joseph
Yeah, but I, I exactly my family. I have three kids now. Well, we’re done I was it. Yeah. Three, three and out. But but I knew I wanted to give my kids an experience and a life that I didn’t have. And again, I don’t know, for me, I it wasn’t like I had. So have.
00;43;20;14 – 00;43;21;00
Rod
You been doing.
00;43;21;00 – 00;43;21;12
Joseph
A life.
00;43;21;12 – 00;43;22;05
Rod
Have you been doing this?
00;43;22;05 – 00;43;24;21
Joseph
Yeah, absolutely. Like I said, we bought we bought the the lake house.
00;43;24;21 – 00;43;25;12
Rod
Nice.
00;43;25;14 – 00;43;41;14
Joseph
You know, that was a big thing for me because I really wanted to, every summer have that really dedicated family time. Yeah. The boat, you know, all that stuff. Right. And so for me, that was super important. Yeah. I wanted to build a life for my family that I never had. I want to build opportunities and experiences for my family.
00;43;41;14 – 00;43;44;13
Joseph
I never so I think that’s the most fundamental change for me.
00;43;44;13 – 00;43;45;05
Rod
Gotcha.
00;43;45;08 – 00;43;54;09
Joseph
But also like, personally, back to the cop thing. It’s like I just I knew I didn’t want to be beholden to someone else’s schedule and expectations. I want to be beholden to my own.
00;43;54;15 – 00;43;56;17
Rod
Tell me your craziest cop story.
00;43;56;21 – 00;43;58;03
Joseph
Oh, man, there’s so many I.
00;43;58;03 – 00;44;00;11
Rod
Know, right? But I do a 1 or 2 crazy.
00;44;00;11 – 00;44;02;16
Joseph
Well, I’ll just say I don’t. I have a really funny one.
00;44;02;20 – 00;44;03;17
Rod
Okay, funny. Funny is.
00;44;03;17 – 00;44;05;18
Joseph
Good. It’s a little graphic. I don’t know if that’s all right.
00;44;05;18 – 00;44;06;10
Rod
I don’t care.
00;44;06;13 – 00;44;07;06
Joseph
For the graphic.
00;44;07;06 – 00;44;08;04
Rod
But. No, no, I want to hear it.
00;44;08;04 – 00;44;08;22
Joseph
Could be a little fun.
00;44;08;23 – 00;44;09;27
Rod
That’s all right. All right.
00;44;09;29 – 00;44;25;05
Joseph
I’ll tell that one. Is this one. This is one of my friends. Always make me tell. So. Okay, good. Okay, so we got this is probably 2020. I get to call it, like, 230 in the morning. About a guy knocking on, massage parlor door. So we had this place was really called Oriental massage.
00;44;25;05 – 00;44;26;26
Rod
Okay, well, we know we know how those go work.
00;44;26;27 – 00;44;40;20
Joseph
Okay? Right. So. So we had heard the rumors of some of the services they offered, all the stuff. I think the fire department done some, like, little undercover sting where they went in, you know, act like they were checking smoke detectors to try to catch them doing something. Long story short, the city didn’t really care. They kind of let him do the thing, right?
00;44;40;20 – 00;44;56;10
Joseph
Right. Unless people were complaining, they didn’t care. Right. So we got a call 230. This guy across the street, we have a UDF, a little gas station in Cincinnati. They said, hey, this guy’s drunk. He’s stumbling around, he’s banging on the door is being loud. You know, we don’t know what he’s doing. So I go over there, find him sleeping in his car in the in the back lot.
00;44;56;17 – 00;44;57;02
Rod
00;44;57;04 – 00;45;08;13
Joseph
I wake him up, I’m like, hey, you know what? What are you doing? You know, I heard you were banging on the massage place, and he’s like, yeah. He’s like, yeah, usually they’re up until 4 a.m.. And I was like, well, I said, I think they’re closed. All their lights are out. And he’s like, I was like, what are you doing over here?
00;45;08;13 – 00;45;21;08
Joseph
Saying, I just came here to get a massage. I was like, you came here to get a massage at 2:30 a.m.? I was like, I can smell you’ve been drinking, you know, all that. And he’s like, yeah. I was like, I was like, so you came here for like, a rub and tug, right? And right. And he’s like, I can’t confirm or deny that.
00;45;21;09 – 00;45;33;12
Joseph
Right. So yeah, basically admits to it. And I’m like, look, man, I was like, where do you live? He’s like, I live right down the street. I said, okay. So he lived in like the next town over five minutes down the road. I’m like, look, I was like, I’m going to, I’m going to be nice. I’m not going to charge you anything.
00;45;33;12 – 00;45;53;13
Joseph
Leave your car here. You’ve been drinking. I’m going to take you home. I said, you know, you can go get your car tomorrow or whatever. And. And he wasn’t driving anything, you know, so I couldn’t get him for DUI, right? Right. So I put him in the car, drove down the stairs. I take him home, right? And, so I get him out of the car, and, I start, get him out, and I’m like, look, I said, I’ve been very cool with you.
00;45;53;13 – 00;46;09;05
Joseph
I said, I didn’t charge you with anything. But I do have to tell your wife what you were doing. Oh. Oh. And he goes ballistic. I mean, this guy scream and he’s cussing, you know, he’s making a scene, and, like, you know, we’re right in his driveway. There’s houses everywhere. I’m like, I’m like, dude, like, relax, calm down.
00;46;09;05 – 00;46;11;21
Joseph
I’m just. I’m just messing with you. He was he was actually. Oh.
00;46;11;21 – 00;46;14;10
Rod
You’re kidding. Oh, you were kidding. Oh, God.
00;46;14;12 – 00;46;30;25
Joseph
Begging me to take him to jail. Yeah, I’m just telling his wife what he was doing, and and so the funny, the funny. The funniest part about this, you know, he he’s, like, freaking out. I get him inside. Whatever. Oh, God. That’s funny. Funniest part about it is, I record this entire story. I just so you.
00;46;30;28 – 00;46;31;09
Rod
You had your.
00;46;31;09 – 00;46;49;05
Joseph
Camera. Well, so so what happened is, if you recall, right around that time, this is right around March 2020. Right? So Covid lockdown, right? I just got on TikTok, right? TikTok. It just kind of became public everywhere, like prevalent. Right? This is like the first TikTok I ever recorded. I tell this story, you know? Okay. And and it goes viral.
00;46;49;06 – 00;47;07;03
Joseph
I mean, no kidding. Yeah. I mean, I like 10,000 views in, like, I’m like ten minutes, right? Oh, that’s also the funniest. So I immediately get a message from TikTok saying that, I used a derogatory, derogatory term in my right, in my video. Right. And I’m like, what are you talking about? I challenge you to where you can like, appeal it.
00;47;07;03 – 00;47;23;27
Joseph
You can. It was a ban. They banned my video, so I appealed it. And they said, you use the term, oriental massage. And I’m like, that’s literally what the name of it is. I say it’s literally called Oriental size. So the funniest part is I get I get, my video got banned right after one month, but yeah, I was that was.
00;47;23;27 – 00;47;24;10
Rod
That’s a.
00;47;24;17 – 00;47;29;01
Joseph
That’s a party story. That’s what every when I’m at a party, I like to party. Whatever everyone that’s for that story.
00;47;29;01 – 00;47;31;14
Rod
Oh my God, you you you scared the shit out of.
00;47;31;14 – 00;47;33;04
Joseph
Oh, yeah. It was hilarious. They’re fun.
00;47;33;04 – 00;47;42;20
Rod
Well, that was a good one. That’s awesome. So, Joe, what’s the what’s your favorite part of what you do? What do you enjoy the most in what you do?
00;47;42;22 – 00;48;01;13
Joseph
It’s a great question. So there’s a few things, but I something that that comes to mind a lot I so I begin this year I merged with one of my best friends and business partners. We actually are construction companies. Oh, wow. So he had his own I had my own. He we worked closely and shared contractors and all this things, but we officially merged it back in the year.
00;48;01;15 – 00;48;17;23
Joseph
Well, we had this kind of company party where we brought all our guys together and our, all our contractors, and kind of announced, hey, this is what we’re doing, this is why we’re doing it. And, and one of the things that came out of that meeting was trying to really hit home with our guys and everyone who works for us.
00;48;17;23 – 00;48;36;02
Joseph
Is that as real estate investors, as contractors, as builders, there’s all these things that we do under our our under our company. At the end of the day, we’re providing housing and we’re providing a service for these people. And while when you’re dealing with annoying tenants and you’re dealing with leaking toilets and you’re dealing with people complaining, which is a lot of the job, right?
00;48;36;05 – 00;48;53;14
Joseph
It gets you get removed from that, you know, you get you get removed from that, wanting to deal with that kind of stuff. Sure. But if you can refocus yourself to realize that these people at whatever income level, whatever class of building they’re in, you can you have an opportunity to provide them a great place to live, a safe place to live.
00;48;53;19 – 00;49;13;16
Joseph
You can provide great customer service on the management side, and you’re going to really be a big part of these people’s lives. You know, I think a lot of investors look at this is like, you know, I got whatever, I got a thousand units, I got 10,000 units. They don’t necessarily care about that individual tenant, but that individual tenant life is vastly shaped by your decisions and by how well you run your business.
00;49;13;16 – 00;49;29;08
Joseph
And I try to really, you know, sense in that home to our employees of like, I know these people get and I know you when you’re dealing with the same maintenance issue over and over, you know, the day to day, every day runs together, right? When you’re doing, you know, our work. Sure. But when you take a step back and think of the big picture, why are we here?
00;49;29;08 – 00;49;39;14
Joseph
Why are we doing this? Why are people paying us to live in our properties? Why are we providing the services we provide? I think you can drill down to that human level, and I think it helps you think.
00;49;39;14 – 00;49;40;15
Rod
You resonated with you guys?
00;49;40;21 – 00;49;54;25
Joseph
Yeah, I think so. You know, and every once in a while, I’ve told this story before, but like, we did a student rental. Right. And so this is University of Cincinnati, right in the house, right in the heart of Cincinnati. Pretty rough neighborhood, right? When you get out of the campus. I mean, it gets it can get rough.
00;49;54;25 – 00;50;10;21
Joseph
I went to school there, so I lived down there, you know, deal with all this. We had a group of girls move into a house. We gutted, you know, full gut like everything else. And they were literally sobbing the day on their moving day because they were they could not believe how beautiful, you know. And these are like spoiled rich girls.
00;50;10;21 – 00;50;16;29
Joseph
Right. And just to go from where they were living as sophomores or whatever, right. I mean, literally on.
00;50;16;29 – 00;50;17;26
Rod
Campus, crappy.
00;50;17;26 – 00;50;32;14
Joseph
Little roaches, rats, whatever. Right? I mean, you’re talking about some rough housing in Brown, University to live in this beautiful building that we made. I mean, I think the guys that were there on their moving day, they were moved. I mean, they were moved, and we all were. I mean, it was like. It was like, oh, wow.
00;50;32;15 – 00;50;36;22
Joseph
You know, there’s a little more to what we’re doing than just money and freedom. Nice. You know, there’s a little deeper meaning.
00;50;36;23 – 00;50;44;17
Rod
Nice, nice. That’s a that’s a great place to end. That’s a great message that you just shared. Well I appreciate you coming down, brother. I know you’re here for a wedding. It just worked out perfectly.
00;50;44;17 – 00;50;47;02
Joseph
Have an awesome experience, man. I appreciate you having me.
00;50;47;08 – 00;50;47;28
Rod
Likewise.
00;50;47;28 – 00;51;08;16
Rod
Thank you for listening to the Lifetime Cash Flow Through Real Estate Investing podcast. If you’ve enjoyed the show, please take a minute to visit iTunes and leave your comment. For more resources or to connect with us further, please visit our website at radcliff.com. Tune in next week for our next show.
