In this episode of Grab the Map, Johnson Crutchfield is excited to invite and talk with Jennings Smith about how to survive in real estate, and how to make your investment grow overtime. Smith will tell his story to you about his origins.
[1:48] Smith is a contractor. He got his license at the age of 19. He was able to accomplish a lot, like built houses, remodeled houses. Smith went through the recession and was heavily involved in renovating houses, but he got tired of doing it.
[02:29] When he got frustrated from all his work as a contractor, that led him to make a franchise model called Alair Homes. This also puts him to the path to serious self-development and investing in myself.
[04:38] He started getting the right rooms, and it's started with a layer that there was a $50,000 franchise fee. It's now I think $80,000.
[05:45] Smith joined a mastermind with Mark Evans's dealmaker family, and he has a group of 33 entrepreneurs, high-level business owners. And it's invite-only. And after he saw what we were doing for a while. It costs him $35,000. No matter the fee, he still joined the program. He sticks a thought into his mind that he is worth as much as how much money he spend.
[10:28] Sharing your successes, Smith thinks that it is important. Because people want, they want to hear that they need to see that because there are so many people that are not doing anything. And so if you're getting traction like if you close the deal, post the deal, you don't know who's looking who wants to maybe invest with you.
[12:25] The first deal Smith did was buying a double-wide that had been abandoned AC ripped out. It is when the father of his friend taught Smith that a mobile home park is a good investment.
[15:14] He found this 12 unit in North Carolina $250,000, the guy wanted for it. And it was losing money. It was occupied, it was in good shape, but it was not in good shape, financially. He took that deal with 30% down and then financed the other 70%.
[19:09] You've got to go into that battle, knowing what you're worth and what you have.
[22:27] For Smith, it's all about the trust. It's easy to promise big returns. He knows how mitigates risk. Aiden and Smith were able to raise $5.4 million in two years in actual cash down payments from investors.
[24:06] The bigger your portfolio gets, the you need more money. if you have a $50 million portfolio, and you have that much money a month going out in payments. you better have half a million minimum sitting in the account and like cash, liquid cash, or more.
[27:39] Smith is confident that he can amortize that property. He can increase rents, and within five to seven years, he can pay this guy off. He can refinance or sell in seven years. And in return. he owns the whole thing.
[31:36] Smith thinks that you should build that relationship with some groups so that you can really mean what you say and be able to deliver on what you say.
[35:47] The way they structured their first deals where they closed them, and all the investors got paid first. They got paid for the first two years until they refinanced and got their money back, then we get paid.
Mentioned in this podcast:
Connect with Jennings Smith for real estate at Facebook named “First million in multifamily”
If you are interested in investing in real estate and make connections, shoot an email [email protected]. Read on some of our blogpost http://grabthemapllc.com/.