You Don’t Need Much to Get Started – With David Dodge

David Dodge is a maestro of the BRRR Method—buy, rehab, rent, refinance, and repeat. Ever since he began investing in real estate, he’s had faith in a system where you can squeeze a lot from very little, and he’s followed this principle to build up assets without sacrificing much or sometimes anything up front. The moral of his story? Anyone can do this.

“I've been investing in real estate for about 17,18 years at this point,” said David. He acknowledges that the first ten years were “super passive.”

“I had a couple different startup businesses with friends, did a bunch of random things for the first 10 years of my real estate investing career – basically all through my 20s. However, each year, I was buying one rental a year.”

“I did that for 10 years, and I acquired 12 houses. Not terrible,” he said. “But about seven, eight years ago, I went full time. And I realized that you could market to motivated sellers. And then from there, you can get great opportunities to wholesale. I think my partner and I have done close to 700 wholesales at this point.”

“The BRRR Method is the absolute best thing that I love to do,” said David. “It's the best strategy, it's the best activity – because what it essentially does is it allows you to acquire assets, single family homes, even do this with apartments. We have a 24-unit apartment that we're working on right now using the BRRR Method. It allows you to acquire the asset using very little of your money and, in often cases, none of your own money in the end.”

What he learned is that you don’t have to pay full retail in the end.?

“The majority of the properties that we're buying are going to direct to the seller, or direct to the other wholesaler,” said David.

“There's two ways to do a successful BRRR and leave zero money in it. And if you use both of these ways, simultaneously, it gets pretty easy,” he said. “If you're just relying on one or the other, it's not going to be as easy.”

The first way is to buy it at a discount. The second is to fix it up to increase the value.?

“It's very simple,” said David. “If you're already buying at a 20% discount – boom – you're there, you nailed it. You get even better, then even better.”

David stresses that it doesn’t take a lot of cash to do this.

“You don't need 300 grand to go buy 10 assets. You can use this strategy to use other people's money. So, by creating that initial debt, by borrowing from a private or hard money lender to buy it and fix it up is very key. Because then when I go to the bank later, I'm not asking for a new loan. I'm asking for a refinance of an existing loan.”

David says he loves the BRRR Method “because it creates assets, which are money-making items. Put money in your pocket every month. We can do it with little to no money.”

“Because we're not necessarily wholesaling these properties, we can piggyback on all the other investors and wholesalers in our market,” he said. “If somebody does a bunch of marketing, and they go get a deal at 70%, and they mark it up, and they make 10 grand off of me, but I get it that 80%, it's a win-win.”

“You don't necessarily have to go corner your market on direct to seller marketing. Instead, maybe just meet the movers and the shakers. Go to the RIAs. Find out who's doing a ton of wholesales and get on their list,” said David. “By all means, do your own marketing. But I would say about a third of the deals that we're buying, at this point are just coming from the efforts of other wholesalers, and I love paying them big assignment fees as long as there's meat on the bone for me. It’s a win-win.”

David also says his focus isn’t necessarily growing his income, but increasing his wealth.

He said the first reason he left his job to do real estate full-time is, “I didn't like the fact that it's very difficult to earn a good wage doing something that you enjoy doing. Typically, you're going to go get a job, and you're going to be following somebody else's goal and mission.”

But the second reason is because he said he “learned at a young age that you're only taxed on income, not on wealth creation. So if your goal is to take your income from 100 grand, 300 grand, that's great, but you just gave Uncle Sam a 50% raise. But if I can go out and I can create 300 grand or 400 grand or 500 grand worth of wealth and equity,? I don't pay $1 in taxes on that wealth that I just created.”

“I realized that the tax laws are written by rich people to protect rich people. You don't have to be rich to play the game. But you gotta understand the game, if you want to be rich.”

David understands these rules very well. But being rich isn’t his only goal.?

“Once you get the financial freedom, the enjoyment, you'll realize that, you know, the most important thing in life is the ability to control your time,” he said. “The money matters to be able to have it. But time is the goal.”

You can watch or listen to Dan Lesniak’s full conversation with David Dodge on Episode 347 of the HyperFast Agent podcast.

Available Here:?Apple Podcasts?|?Spotify?|?YouTube