Changing The World From The Local Level

Dylan: From chemical engineer to super successful real estate investor.

Welcome to Real Estate Investing Secrets. We’re all looking for freedom and the opportunity to live better, more fulfilling lives, but most of us were trained our entire lives to work for someone else and chase their dreams. How can we use real estate investing as a vehicle to achieve financial freedom?

My life is dedicated to answering your real estate investing questions and helping you build an investing business that allows you to change your. And the world around you, and to enable you to turn your dreams of financial freedom into a reality. My name is Mike Hambright from FlipNerd.com and your questions get answered here on the Real Estate Investing Secrets Show.

Dylan: Hey Matt, how you doing today, buddy

Mathew: Dylan, how you doing? Great to be here.

Dylan: Awesome. Awesome. Yeah, super excited to have you here. So you are on the Real Estate Investing Secret Show on the FlipNerd Podcast Network. For those of you listening and watching, make sure that you subscribe and go back and watch all or some of our 1500 previous podcasts where we share real estate investing secrets to help you make more money as a real estate investor.

Dylan: So I’m super excited. Have it. I have Matt Pezon on the show today, Matt, you are from the Lehigh Valley area in Pennsylvania. Why don’t you tell everybody a little bit about how you got started in real estate?

Mathew: Yeah, that’s great Dylan. And thanks again so much for having me. I’m, I’m honored to be your guest.

Mathew: Um, so to get started, I, I, maybe it’s unique or maybe not, but I, I backdoor found real estate. I had always wanted to be a chemical engineer. I come, I think I’m the fourth generation, um, engineer in my family. And I actually found, uh, real estate investing overseas, which sounds a little odd. Um, I was awarded a Fulbright Scholarship to study my MBA, and I did it in Madrid.

Mathew: All in Spanish, no English, every negotiation, uh, every test, every presentation. It was all in my second language. So the one, uh, one class and one module that I did that really stuck out for me was there was a small portion on real estate investing and on debt specifically. And we covered stocks and bonds and all this other stuff, but I.

Mathew: It was a little abstract for me, and I really honed in on that, that that finance and debt portion and the real estate investing side, and that’s where I actually discovered real estate investing. I had no intention of getting into this business. No one in my family’s involved in this business and it was not even in the United States.

Mathew: So that’s . It was, uh, it was really backdoor. Um, but once I took that class in the beginning of the program, I knew that when I got back to the States, I was just gonna figure this thing out. And that was in early 2014. And, uh, and then I bought my first property then in that, in October, 2014, after I’d been back for six months.

Mathew: So that’s how I got started.

Dylan: Interesting, interesting. So you shared with me earlier your age. You look like you’re about 18. You speak like you’re about 45. I can tell that, you know, you’re well read and that you’ve studied a lot. Um, so you’ve been real estate, you’ve been an investor since your, your mid to late twenties.

Dylan: Right. If I’m doing my math correctly, So, uh, I, I don’t wanna know what you’re doing yet today, but tell us about your first deal coming back from Madrid, Spain, and you’re coming back, you’ve got your MBA, you’re ready to rock and roll, and you’re a chemical engineer. How do you, how do you start doing real estate deals?

Mathew: Yeah, that’s, that I, I didn’t know right away and I had to figure it out. So I, I was going to some of like the r local meetups and stuff like that, and I got involved with a group of people that, um, well, at the time there were foreclosures, there’s, there aren’t anymore, but every Saturday I would get up at 6:00 AM So all my other friends were, you know, they had been up late the night before or whatever they were doing.

Mathew: I was getting up at 6:00 AM meeting a group of investors for b. We’d get breakfast from seven to eight 30, and then we’d go around town seeing these foreclosures, and I, I went into hundreds of properties probably before I fir I bought my first property. I, I probably went into maybe 60 or 70. And, uh, then I just put in an offer.

Mathew: I was surrounded by a group of people that, uh, that were experienced that were, there was a property manager involved in that group. They, uh, they, they showed me the ropes, so to speak, and, uh, um, and, and that’s how, that’s how I got started. I bought the first deal and, and, uh, then I just kept buying after that.

Dylan: So was your first deal, uh, a residential

Mathew: property? Yep. That’s right. Yeah. It was a single family residential property in Allentown on the east side of Allen.

Dylan: Gotcha. So fast forward eight or nine years later, what are you focusing on right now with your company? What type of acquisitions, what type of properties?

Dylan: Usually

Mathew: we’re buying properties in three to six units. I still buy a lot of single families. Um, I bought probably 20 this year so far. Um, and, and, uh, just, just looking to continue, uh, buying one to six family properties.

Dylan: So what do you, what do you like about the one to six properties versus you? And I know a lot of guys in Gal, some around the country, right?

Dylan: And they talk about, and we watch podcasts. We’re on a podcast. We, they talk about you wanna be a hundred units plus because of management, or you wanna be at 250 units so that you can syndicate. But I think, um, it’s much more digestible for most, uh, newer real estate investors or maybe those who’ve been in the business for a long time and haven’t kind of leapt into the multi-unit world.

Dylan: What do you find, uh, uh, interesting and why do you focus in that three to six unit range?

Mathew: Yeah, I, I think for, for two reasons. Um, usually when I buy, I try to add value, and there generally there’s the most value available. So if there’s a distressed situation where a seller, uh, has to sell due to either repairs or there’s some other issue going on, um, uh, I’m able to come in and solve that problem for the seller, which I really like.

Mathew: Um, now, in, in, in maybe 20, 30, 40, a hundred plus unit complexes, um, historically up until. Now there are good deals, but it’s, it’s, uh, it’s a little bit more difficult to find, I found. Um, whereas the one to six family space, I, I, I think there’s, there’s opportunities to add value everywhere, um, uh, in, in this market.

Mathew: And so I like adding value to the, to the seller. But then on the other side, I get to add value for the community because typically the end buyer is, uh, is an owner occupant, a first time homeowner. And it, it brings me a lot of personal satisfaction to sell a home to a family where this is their first.

Mathew: I’m able to after maybe 5, 6, 7 years renovate again and, and sell to a first time homeowner, which, which is a really good feeling. It, it’s, uh, traditionally in, in the Allentown and Lehigh Valley market in, in the urban cores. A lot of the, uh, a lot of the product is owned by investors like me. So recycling some of those properties into the hands of someone who will live there is, is quite frankly, uh, uh, sat satisfying for me as, as an investor to repurpose those.

Dylan: Gotcha. That makes a ton of sense. And, and you know, before we got on Matt, um, you kind of enlightened me a little bit to what’s going on in Allenton and, um, the Lehigh Valley area. Uh, myself, you know, I’m from Detroit, so we’ve had a lot of revitalization there in the last six or seven years. We were the laughing stock for a lot of years.

Dylan: The Rust Belt is tough, right? You’re a Pennsylvania guy. I’m a Michigan guy. Ohio Buffalo. You get outta New York City and, and it’s tough, right? It you, it’s they’re gritty people and uh, and we have to work hard. The market has, uh, has changed right in, in the last almost decade or half a decade. It’s been a very positive, I think a big uptick.

Dylan: So share with us what’s going on over there, um, in, in that Lehigh Valley and you talked about the proximity to the bigger cities.

Mathew: Yeah, absolutely. And, and it’s, uh, we were talking before, it’s funny, you know, as you’re from Detroit and, and even when I was in Spain, um, a lot of. A lot of people knew the Billy Joel Allentown song, and it’s really given us the bad reputation

Mathew: And there’s even marketing literature from the big developers now about, uh, you know, Billy Joel’s wrong and all this stuff. But basically what’s going on in the least Lehigh Valley is, uh, due to the proximity, and I think some of these trends have been, there’s a high cost of living in New York, New Jersey, these urban centers and, and people are migrating.

Mathew: We saw a big shift in population during Covid. And that has certainly accelerated to our area, um, Eastern Borders, New Jersey, Bethlehem, Allentown, we’re, we’re right on the border with New Jersey. Right on that 78, uh, 81, uh, 4 76 corridor. Right? Right. Within, we’re within a, an a one day truck ride from 40% of the US population on the eastern seaboard.

Mathew: And so, um, that has driven logistic. Development, it’s driven a lot of growth in this area, uh, due to Amazon and the rise of e-commerce. And so our area has really benefited from that. Um, like I said, uh, Boston to DC and, and further south is accessible within a one day drive and it’s, it’s just caused the area to boom.

Dylan: Yep. So I’m, I’m curious, um, you’re a decade younger than me and, uh, I wish I was a decade younger still, but, uh, so, so I think you’re, you’re kind of in between the, I don’t know what they’re called, the zens and, and Gen X. So maybe you’re, you’re a Gen Z, whatever that is. I know your age. Um, what do you see happening, I guess post c v I don’t know if Covid is the reason, but just as the world’s changing from, you know, like rotary phones and dial up internet to, to where it’s gotten today in 2020.

Dylan: What do you see happening, I guess, for those big urban centers? And you talked about, you know, being able to, to live outside of New York City and still work in New York City. Where, what do you think’s gonna happen over the next decade in your opinion?

Mathew: Yeah, that’s, that, that, that is a part of my thesis. Um, the answer to this question, I believe that with the internet and with improvements in, in transportation, um, and distribu.

Mathew: Um, and also with inflation, the high cost of living. I, I believe that peoples want to be connected to those urban cores, to your Philadelphias, to your, to your New York’s, um, and the, that entire area, uh, along there, down to your Baltimores, up to your Bostons. But a, a lot of people are going to struggle to afford it.

Mathew: Um, the wage gains haven’t really kept up with inflation, and people are feeling the. Throughout the country, housing costs are an issue. It’s difficult to build product, um, in these urban areas at a price that, that people can afford. And developers are having a hard time bringing new supply on board because of these, these, uh, the escalation and costs to develop the, the regulations, the costs financing and the interest rates are going up, it’s, it’s difficult to, to bring new supply on and just having the.

Mathew: The Lehigh Valley in this, this area just outside Philadelphia, New York has a lot of the solutions to these problems, which is why we’re seeing new supply coming on board here in, in downtown Allentown, in Bethlehem and Easton. Um, there, there, there’s just the, the, the cost of living is cheaper. There’s a, a great quality of life.

Mathew: I’m sitting, I’m looking out my window at the, the Blue Mountains right here. We have the Poconos, 25 minutes from where I’m sitting. You have skiing, you have the ocean, uh, about, uh, an hour and 15, an hour and 30 minutes away without traffic. You have the urban cores. Um, you can go to now after Covid that there’s theaters, there’s these districts that are, that are opened up again and people want to.

Mathew: Have an affordable place to live, but still be close to those areas that they can go to. Um, and they can work remotely now because of the internet, and they can get stuff that they need fast because it’s here. So for all those reasons, I listed 10, 12 reasons. That’s my thesis on this area. And I’m, I’m all in.

Dylan: Yeah. As, uh, when we spoke earlier, I was a little surprised because I know, you know, I would say you’re probably one of the more, um, intellectual investors I know, or that I’ve talked to recently. Um, and it surprised me that you, you’ve stuck close to home because you do have a lot of units. Um, and most times guys or gals are kind of like reaching out and you’re like, ah, I’m in, you know, I’m from Lehigh Valley, but I’m looking in Arizona and in Florida and in Texas, you know, all the different places where everybody, you know, it’s sexy to own real estate, but you believe.

Dylan: What’s gonna happen over this next decade or two or three? And, um, and I kind of, I kind of agree with you. You know, I think, um, being close to those places helps. Uh, you could be up in the mountains and a million miles away from everything. And because of the, the internet and what we can do today, get more done, but being close, like you said, you guys are, are how far from New York City or, or the, the heart of, I don’t know, whatever the heart of the city in Jersey is, you guys go to, to do.

Mathew: Yeah, I, new York’s an hour and a half, hour and 45 minutes. Okay. Depending on where you are in the Lehigh Valley, it’s very, very close. You could be in midtown Manhattan in an hour and a half.

Dylan: Yep. Right? Yeah. That’s amazing. So you could take, you could take a super important meeting, but still live somewhere where the dirt is cheaper to buy.

Dylan: Right. And that’s right. Developers. So I, I personally build homes, right? So I understand the whole development game and how they call it being Quas. I don’t think that’s a true finance term, but, The, the developers are being squeezed from both ends. So, so the price of of materials is skyrocketed. Uh, the price of labor is skyrocketed, and there there isn’t much labor anymore, and interest rates have gone up now.

Dylan: So it’s definitely tough. It’s almost like. There’s areas where you can get lots, you know, to build homes on for free, but you still can’t build and make enough money because you have to build a certain size home, um, you know, to, to make a profit. So I think you, you’ve kind of outlined that section there where, where you’re in the happy medium and there can be development because, you know, Pennsylvania, New Jersey, those are old states, so they were developed a long time ago.

Dylan: So it probably surprises others just like myself that there’s still tracks that can be developed or maybe even more likely redevelop.

Mathew: Oh yeah, that, that’s, that’s absolutely right. And, and really the main driver for that redevelopment. In addition to having the land, you also need people, you, you can’t just have land.

Mathew: And, and the, the, there was an article that came out in the, the morning call, a local newspaper here that, that the Lehigh Valley is poised to take on there. There’s 687,000 people in Lehigh, north Hampton counties. Um, it over by 2050, it will increase by 100,000. And, and you really can’t say that about most other counties in Pennsylvania.

Mathew: Um, a a lot of, if you go west to Pittsburgh, central North, e e, even Southern, uh, Pennsylvania. Populations are declining, but not in this area. And, and that’s why frankly, I, I happen to live here just by, uh, by, by where I was born and from. But, um, I would’ve, I would’ve sought out an area just like this.

Mathew: Anyway, uh, jobs are coming here, logistics is coming here. It’s a diverse economy and there’s, there’s over a hundred thousand people expected to move here in the next 28 years. They need housing and, and, and frankly, it’s difficult to, to build housing because there’s competition with some of the logistics companies and it, it makes the value of the land go up and, and it, there’s, there’s less area to build both.

Mathew: Um, if it were one or the other, I could understand maybe less competition for, for that ground. But there’s, there’s a lot of demand, both residential and industrial. And, uh, for all those reasons, I, it’s, it’s, I I would’ve been looking for a place like this anyway, but I just happened to live here, ,

Dylan: so. Yeah.

Dylan: No, it’s, it’s a very interesting take. I don’t speak to many people who, um, I don’t know, just on their investors that, that you and I both know from around the country who, who have this outlook. So I think we have to drag it back down to, um, to normal real estate investing, speaking now, cuz we’re going pretty deep there.

Dylan: But I think it’s important to get that, get that outlook, the outlet out there. Matt, but let’s, let’s go back to, to real estate investing and getting started. What, what is your probably number one piece of advice for someone who wants to get started as a real estate investor?

Mathew: Yep. Um, I would say number one is education.

Mathew: Um, consume. As much as possible, um, in terms of podcast, this podcast, other podcasts, books. Um, number two is your, your network and your team. Um, really don’t, don’t go alone, especially in the beginning. Work with trusted individuals, trusted contractors, trusted agents, um, trusted brokers, trusted lenders, um, and you can meet them at, at meetups in different places.

Mathew: And then also your personal, um, financial situation. You, you need to get a loan to buy generally, especially if you’re getting started. So make sure your credits in order and you’re making you have solid income and you really reduce your expenses. Those are my top three things.

Dylan: Gotcha. So that led into my next question, uh, networking.

Dylan: Super important. I know that it’s been a huge function of my business since I became a, a full-time entrepreneur and even before I was full-time. So can you give a, an example or two of where networking, um, and, and knowing the importance of that has, has led to some positive things in your business?

Mathew: I’ll, I’ll give you the perfect example, that 30% of the properties in my portfolio were referrals from.

Mathew: It’s not necessarily direct from sellers as a result of my marketing, it’s relationships, um, specifically with two individuals, um, that, uh, have really helped. So it’s, it’s just another avenue to find opportunities. But outside of just deals, I mean, it’s, uh, it. It’s absolutely a people business. And so you need to have a good lender, someone who understands investors, not just a a typical, well put X down and here are terms and take it or leave it.

Mathew: Someone who really gets you, who can work with you. The right insurance agent. The right contractor, the right manager. Oh my gosh. You need the, you should manage your own property to start, um, or proper. Up to a certain number to really cut your teeth. But your property manager, I mean, that’s someone that you’re, you’re, you, you got, you’re ba it’s a long term relationship.

Mathew: You’re married to that person. Um, so I mean, that’s, your network is huge in this business.

Dylan: Yeah. And I love what you said there about acquiring properties. So you and I are both an investor fuel. It’s a nationwide mastermind, uh, founded by Mike Hambright, who also started this, uh, the Flip Nerd, uh, podcast here.

Dylan: But, um, and that’s where we met. So we get to get together with, uh, about a hundred, 150 guys and gals every quarter. We get to help each other through challenges and listen to what’s working in their markets and just really kind of build a brother and sisterhood and, and share information and be there for one another as a support.

Dylan: But something that, that I listen to, I don’t know how much you hear, but I hear how much all of the different members are paying per acquisition, right? So being in, in Pennsylvania or Michigan, I would assume it’s a somewhat similar, um, cost. Right? So what we’re talking about here is how much. We pay in marketing to buy a property, whether we’re gonna buy it or keep it, flip it, rent it, uh, rehab it, whatever it is.

Dylan: So say that that’s three, five, $7,000, something like that. In Dallas, it’s like 14 or 16 or $18,000 to acquire a property. So, uh, what I’m hearing you say is that 30% of your, your, the properties you own, your portfolio have come at least 30% of them. Relationships. Yeah, so I would imagine that you’re probably at a five to $7,000, um, on the high side, you know, cost of acquisition, uh, in your neighborhood, in your area.

Dylan: So just think of how much money that you’ve saved or gained, whichever way you wanna look at it. Using those relationships and not just focusing on the relationships to buy more property, but as a whole, those relationships are so important, like you said, as a people business. Oh yeah. So, Matt, I don’t, I don’t know if you can share if it’s too private, but can, can you share a little bit about, with one of those individuals or, or companies that you were able to, to buy a bunch of properties from?

Dylan: Like how did you build that relationship? How did that deal come?

Mathew: Yeah. So, um, I’m involved, I’m a volunteer at the Real Estate Lab in Allentown, and, um, we basically, with the Real Estate Lab’s purpose is to, to educate and to provide real estate entrepreneurship coaching to demographics that have historically been excluded from real estate ownership, uh, uh, impoverished or, or excluded groups.

Mathew: And so through this, this program we teach, we, we basically offer knowledge networks and capital. To, uh, to the students so that they too can invest in real estate. It, it’s not investors from outside of urban cores that purchase properties we’re coaching. The, the, the people we’re providing credit counseling services, we’re providing income counseling services and real estate coaching services to these, these residents of downtown Allentown so that they can buy properties.

Mathew: We, we believe that’s the most powerful way to, to, uh, to help groups. Historically havet owned properties to get into them. So, uh, to answer your question, it was through that group . I, I met individuals by, by donating time, uh, by, by, by helping other people and by freely giving of my knowledge and education that I had amassed over, over the prior five or six years.

Mathew: And, Other people saw what I was doing. They had opportunities that they couldn’t close or that they wanted to, they had other, they had too many deals, and they just needed someone trusted that could close on a portion of portfolios. And they tapped me on the shoulder because I had been giving away my time for three years, and I had never asked for anything.

Mathew: I never expected anything. And, and I, I was trying to do the right thing. And so, That’s how I, I really, the, the best way to, to, um, to get referrals is to give first you, you can’t, uh, you, you can’t just meet people, hand out business cards and expect that they’ll call you. You really have to give and solve problems for others.

Dylan: Yeah, I have a saying. You, you almost have to give till it hurts. And, uh, I’m definitely guilty of that. Sometimes I’ve given too much, but I look at it like this, I’m happy in life. So that’s really all that matters to me down deep. Um, so what would you say out outside of the, the real estate part? We talked a little earlier about mentoring and, and, uh, you know, uh, the mastermind principle, but, but mentoring others even outside of real estate, because I think what you do through that organization, I, I’m sure you’re imparting wisdom that isn’t just real estate wisdom, right?

Dylan: It, it, it kinda, it covers a lot of different parts of life. So what, what do you get most, uh, being out of being a volunteer?

Mathew: It’s, it’s the satisfaction that comes with watching someone who couldn’t do something before, do it now, and, and something that’s so life changing as buying real estate. That that’s, that’s the reason I do it because I want to see people succeed and I want to see people that thought they couldn’t do something or were told they couldn’t do something, knock it out of the park.

Dylan: Yeah. That’s, that’s super noble. You don’t get paid for that, but you get paid in other ways, and sometimes you end up getting a bunch of properties that make sense to you thrown away. Right. Well, that’s what happened. Yeah. And, and I, I would’ve kept doing what I was doing anyway, but that’s how the referrals came about. It was just those relationships.

Dylan: Yeah. No, that’s, that’s, that’s great stuff. Um, if you’re listening and watching that you guys, uh, take note. I tell new people come to me. I’ve been running real estate groups for a long time and hanging out with real estate, you know, nerds like us and the new people who are excited, they always run up to me, you know, after speaking.

Dylan: And they’re like, what, what’s the first thing I should do to get started? And I’m like, well, I think you should find an organization that you can give time to. And they’re like, well, I wanna flip houses. And I’m like, you’ll flip houses, but find a cause that makes sense to you or to your family or your beliefs, whatever that is.

Dylan: And give a little bit, because once you do, you’re gonna have a different perspective. You’re gonna meet a lot of great people and you never know what comes out of that. And they like, look at me funny. And it’s like, I’m not gonna teach you how to wholesale until you do something good for the world, because I don’t offer coaching programs.

Dylan: Right. But I’m serious when I say that because you just never know what can come out of it. And I. Um, you know, just my personal belief is there should be a little more of that in the world today. So it’s, it’s nice to hear that, um, you know, that, that you have that same belief. I think it’s, it’s strong for, um,

Mathew: if Yeah, absolutely.

Mathew: Bill, and, and if, if someone is starting out. So in this case, I, I gave knowledge and experience and connections I, I freely shared with the part with these cohorts. But it, so if you’re just starting out and you don’t have those things, well what can you do? And if you’re looking for a mentor, What do they need that you can help that person with?

Mathew: So is it running around and, uh, checking up on properties, doing inspections? Quarterly inspections. Find out if you’re trying to to learn something and you want to gain knowledge, what can you give first? What do the investors or or wholesalers or flippers that you’re working with, what do they need? Find out and give it to them and give it to them for free.

Mathew: And, uh, and they’ll reciprocate that. That’s, that’s the, that’s the best advice that I, I think I could give to someone getting started. If you don’t have knowledge, no problem, but you have time, you have energy, um, you have other relationships, connections that you can offer. Um, and you have hard work. So offer one of those things and, and help someone out and see what comes your way.

Dylan: So every guest I have, we talk a lot about networking because it’s important to me. It’s basically how I’ve met every single person who’s been, been on this show. And, uh, you guys always kind of say the same thing, right? You’re like, give before you receive, show people value. I don’t care if you know how to pick up buckets of paint, or whatever that thing is, right?

Dylan: Because if you don’t have the knowledge yet, you have to gain it. And just going to, you know, to classes or taking courses or boot camps, that’s not gonna do it. You need real life info from people who are actually doing the business. So, uh, that’s, that’s kind of a common theme. So it’s funny that you bring that up because it is very, very true that, um, That there’s a lot of investors out there who will help other investors, but they don’t even know what they need.

Dylan: So it’s kinda like, Hey, I’m here today. Tell me what you need me to do, and then all of a sudden you can just absorb a lot more, um, knowledge. So what, what would you say, uh, so far, Matt, in your career has been your biggest real estate investing mistake?

Mathew: That’s, that’s a tough one. Cause I’ve made a lot of mistakes.

Mathew: Um, I, being

Dylan: on the show as of right now is your worst mistake, right? ?

Mathew: Well, it depends how I answer this question. We’ll see, right. ? No, I, I would say the, I, um, the, the first, the first. So I try to do a flip. Um, and I wasn’t prepared to do it with, I, I’m not really like a, I don’t have a good design eye and I, I didn’t fully understand all the decisions I would have to make, and I wasn’t a. At that time, a good project manager. I am now for making a lot of mistakes and screwing up projects for years. But the, the, um, I that, the flip that I tried, um, and now, you know, now looking back, it would’ve been a great property just to keep, but I, I, I was paying the contractor, uh, on, uh, you know, Basically, whatever he got done that week, I would pay him for and so there was no incentive to get anything done. My debt was expensive. It was a hard money loan. And, and, uh, the, the contractor was also doing lots of work for other properties. And so my, my property was, um, uh, was really down the list for him in terms of what he wanted to, to, to get to. And he got paid every week.vHe’d show up, do a little bit of stuff, and that was it. So I think I lost that was, I think, Fourth or fifth property that I purchased, and I think I lost $5,000 and it took a year and it stressed me out. It really, really stressed me out. I swore I would never flip again. And, uh, but then I ended up doing it later and doing it right and it was, it was great but I, that was, I, I was unprepared for the people management, the, um, the hard money loan. Um, and. I just wasn’t really prepared to run that type of a job. I was more, I’m more geared for long term investing and, and, uh, that, that, that flip.

Dylan: Yeah, we always learn more from our losses than our wins. I believe. You know, anybody can hit a home run once in a while, but when you strike out 20 times in row, you start to learn how not to strike out when you’re up at the plate. Yeah. Um, that’s, that’s for sure. And, uh, and being humble and, and knowing that is important and I think, you know, we all have a unique ability.

Dylan: I’m not a long term hold guy, and I used to always joke with, with people, especially local people at my meetups, Hey, I hate being a landlord. I don’t wanna be a landlord, but I know what I’m good at. And you talked about like a designer, like I used to love rehabbing because I love the whole design, you know, aspect of it.

Dylan: And you’re like, eh, I don’t care about that. I just want a great product. I can deliver and keep, you know, renting out year after year after year and building a portfolio. So I think for newer investors, you, you have to try out a few different. Parts of this, this business, and just see where, where you gravitate toward, because again, like we talked about when, when you were 15 or I was 15 years old, we probably never thought we’d be sitting here talking about this or even some of our achievements being humbled, but some of our real estate achievements the first year we were in real estate, how would we have ever thought, you know, we, we’d be where we are and hopefully where we will be right in the future.

Dylan: So what do you think, um, what do you think your best education has been, whether it’s been paid for or, or through personal mentors, but helping you become a better real estate entrepreneur?

Mathew: I think the best education, well, two, there’s, there’s two best educations, . The first one is a lot of, um, free content like this.

Mathew: Um, you know, other, there’s, I’ve listened to tons of, of audio books. I’ve read physical books, mindset books, just, uh, there. There’s so much content available and just being hungry enough [00:29:00] to read it and actually do it. Um, I never, um, I never paid for education in a traditional sense for like paper and books or seminars or anything.

Mathew: The education that I have paid for is through mistakes, through experience, and so at some point you have to stop. Educating, you have to start doing and you will make mistakes. It’s okay, but you have to try. And, and as long as your, your first dealer, two or three are really solid, that it’s not gonna wipe you out and take you down.

Mathew: Um, those need to be really good. But after that, as you build some, some, uh, some acumen and you, you build some capital, you can um, you can weather more mistakes, but just making mistakes and, and getting, getting into it. Now you, the reading and the studying and, and anything that you do and the audio books, podcast.

Mathew: That’s how you make less and less mistakes or fewer mistakes, but you still will make them. So you have to at some point transition to doing the, the best experience, the best way to learn is doing, but don’t do before you read and learn, um, and, and, and practice first. Otherwise, you could

Dylan: get burned. Yes, this is true.

Dylan: Um, so, so you brought up a a, a good point. You talked about mindset. I think that, um, you know, when I study and I, and I, and I’m lucky again, you know, I, I get to help facilitate an investor fuel. So I, I get to be a part of a lot of these, um, the, the members, what, what they’re going through and, and trying to solve, right, or even what they’ve had success.

Dylan: And I look at those, those guys and gals and, uh, and most of them are, are, um, are pretty advanced real estate investors. You know, the, the, the top-notch members of the group are doing hundreds and hundreds of deals a year, right? So you can learn a lot from these people. And I watch what they do and it seems like mindset.

Dylan: Uh, you know, every step that, that we take mindset becomes more and more important. So for, for you, Matt, like, what, what, I guess what book number one would you say has, is, is your best mindset book, if there is one? And what has mindset shifting and changes meant to you in your success

Mathew: Ladder? Yeah, that’s, uh, man, there’s so much to unpack there, but I, I would say, um, the most important real estate is between your ears.

Mathew: If not, uh, it’s not anywhere else. It’s, it’s how you think. So if that’s the most valuable real estate, you really should spend a lot of time working on it and improving it, because everything flows from the mind. So I’m there, there’s, there’s a lot of, um, different mindset books that I’ve read over the years.

Mathew: I like, think and Grow Rich, Napoleon Hill. Um, that’s, that’s a, it’s a classic. Um, for me growing up, I, I learned a lot of, um, negative money and, and wealth beliefs. So for my part, now, I don’t know, depending on the listener, they might have grown up differently. They might have had a different blueprint. But, um, tea Hart Har ER’s book, um, about, uh, the, uh, what, what’s it called?

Mathew: The Secrets of The Millionaire Mind, I think. Yes. Um, yeah, it, that, that was a really important book for me because I had to real, I had to unlearn certain things, uh, that I learned growing up and, um, that [00:32:00] weren’t helpful for me to starting a business, being an entrepreneur, um, and adding value in the world.

Mathew: I learned other things, so I had to unlearn. So I would say those two, think and Grow Rich and, uh, and Andt Har Backer’s book.

Dylan: Yep. Yeah, I think that’s great. Uh, think and Grow Rich is like the business Bible to me. Um, you know, I. The first time I read that I was probably, you know, younger You were, you were younger.

Dylan: I was younger, but uh, you know, I was, you were just a kid. And it just changed my mindset to say, wait a minute, some of this weird stuff I’ve been able to achieve and I was in my early, early twenties. I’m like, how was I able to achieve that? And it’s kinda like, This is how buddy, you just have to believe, right?

Dylan: Yeah. And uh, and again, being, being Midwest, I make this joke all the time. Like the county that I’m from in, in Detroit and Michigan, like people do their own breaks in the front yard, right? So, um, it’s a Midwest way of thinking. So you have to change, have that shift. You don’t have to, but I think if you want to get to three or five levels past where you ever thought you could even get to the millionaire next door, you know, idea is okay, [00:33:00] but it’s really hard to save your way to being a millionaire.

Dylan: And, and let’s face it, being a millionaire today isn’t what being a millionaire was 20 and 30 years ago when some of those books were written not right, not thinking Grow Rich, of course. Like the millionaire next door. So, um, so yeah, I think that’s really important for you, for the listeners and watchers.

Dylan: Make sure that you’re working on that real estate in your mind because no matter what, I joke about this with a lot of my friends on the show, Matt, it’s like you’re never gonna see me doubt. Because even if I am, I’m not because there is only one place to go and it’s up. Right? So I have to be positive because I, you have to control your own mind.

Dylan: And as an entrepreneur, it’s, it’s us against us. I don’t care if we have partners, spouses, any of that other stuff. If, if we’re not right up here, then, then everything else is gonna, is gonna crumble. So we have to be positive and, and be around the right people. Again, that’s building your network, that’s doing the right self education and.

Dylan: Really just, just being in control of yourself. A lot of new investors I talk to, they’re like, how do you get started every day? You know, how do you keep finding deals? All that other, you know, all those other questions when you don’t have somebody telling you to do it. And that’s the difference between being a true entrepreneur and self-starter and, and just being employee minded.

Dylan: So when you, when you made that shift, and, and this is why I brought that up, let’s go back to the, the chemical engineer. Um, so you went to school, you, you know, you have a very serious education and again, that’s, you know, admirable, but then all of a sudden you’re, you know, maybe in your parents’ eyes, you’re ready to crumble up that diploma and throw it all away and become a real estate investor.

Dylan: So, so how do you go. Um, and I’m sure you could be an entrepreneur as a chemical engineer, but more than likely you’re gonna work for, for a big company or the government. So how do you go from, from that mindset to, Hey, I’m, I’m gonna wake up every day and just figure out what I’m gonna, you know, do for the rest of my life.

Mathew: Yeah, I mean, that, that’s a, there, there’s, there’s a lot there, but I double hated for years and so I, I was, um, I bought, uh, so, you know, only recently did I, it was just, you know, very recently that I, I moved on from my full-time job and it was, I had been purchasing properties, nights, weekends, taking half day vacations for a long time and, and for, for almost eight, you know, for eight, almost nine years.

Mathew: So, you know, it was, A, oh, I’m just gonna quit and do this. I took a, now it’s probably the chemical engineer in me and there’s different ways of, of approaching this problem, right? So I’m just saying, what, what, what happened for me? But I saw the value in keeping my full-time job because I could get better loan terms.

Mathew: The banks loved it, you know, making, making a good income, the, and the education credentials that you’re, you’re much more lendable. Yeah, the bankability was huge. So, for the listeners, as you’re getting started, It, it really comes down to it’s your mindset, but it’s also. How much money are you making? How much money are you saving?

Mathew: And how can you prove to someone like a bank that they should give you money? And it really comes down to how do you, how do you manage your personal funds, your personal, your personal budget, what’s your credit like? And uh, and double hating and having that income is so valuable as you’re getting started because banks will love it.

Mathew: It’s predictable. So they want to, at the end of the day, they wanna get repaid. And, and so that’s, that’s why I was able to, I kept my job for so long, probably too long actually. Uh, but, uh, um, it, it, uh, that was the reason was for loans in getting good lending terms.

Dylan: Yeah. I think it’s, it’s a huge shock when, um, I spoke to someone yesterday and they said, Hey, uh, I’m a full-time investor now and I wanna buy a new house.

Dylan: Right? So they’re like, How long do I have to wait until I can get a mortgage? Now, I’m not a mortgage guy, but I, I know pretty much what the rules are, right? And I’m like, well, you’re gonna have to have like three years. Of 10 99 income, right? And they’re like, no, there’s no way. And I’m like, yeah, it’s a hundred percent way unless you’ve got a whole bunch of cash in the bank.

Dylan: But I’m like, you just left. You know the golden goose. Now hopefully it’s gonna be for the right reasons and you’re gonna be super successful. But you know, and they were really surprised about that because when you’ve got a seven 40 credit score, you make 120 or 150 or even $60,000 a year, you can get a mortgage like that if everything else is in line.

Dylan: As soon as that, It’s like, you know, it’s like, I, I don’t know what, but it’s like, oh yeah. Pushing the golf ball through a, through a, a garden hose. Like it’s just not gonna work that easily. .

Mathew: That’s right. Well, and the other thing too is another mistake that newer investors make is they’ll just jack up their property with expenses because on their tax returns, because they don’t wanna, oh, I don’t wanna pay tax, or, you know, and it’s some small amount of tax based on your cash flow.

Mathew: Now, next year or year later, and I’ve heard stories where then they quit their job, but their properties aren’t cash flowing, and now they’re struggling to get loans, but they quit their job and they have to go back. And you, you just need to, you need to think through all these things and don’t, don’t quit your job too soon because you can find.

Mathew: Properties on nights, weekends, taking half days if you’re really committed, that that’s what I did for nine years, and, uh, just don’t quit it too soon. It is really, a lot of people look at a W2 job as something that is just a grind. I have to do it. And, uh, I’m, you know, I, I, someday I wanna be my own boss.

Mathew: You can, but leverage it for what it is while you have it. And you don’t have to move on too soon because there are benefits. Health insurance is another one You could spend easily. Spend a thousand bucks, 1500 bucks a month on health insurance for a family of three or four. So, so take advantage of the job while you have it and, and leverage it.

Dylan: Yeah, no, I totally agree with that. I think. There. I’ve had guys come to me for, for years and years, and there’s so much glory in being a full-time real estate investor. I’m a real estate investor. I’m an entrepreneur. I quit my job and some guys who still have jobs I know and, and, and ladies too, like. They still kind of look down.

Dylan: They’re like, yeah, I’m still working, but next year I’m leaving. Next year I’m leaving. And I’m like, don’t leave to leave. Leave because it’s the right thing to do, but why don’t you have a goal to buy seven more rentals between now and then? I don’t care if you seller financing, hard money, bank money, whatever you have to do, and why don’t you replace, you know, another week’s income?

Dylan: Between now and next year or or another, you know, triple that, Quin topple that, whatever you can do. And, uh, I think that there’s just like so much, uh, false glory in being a full-time real estate investor. And I tell guys all the time, like, please don’t quit your job because when you do, don’t tell me that I’m the one who had you do it.

Dylan: Because just because you have one lucky deal or one lucky quarter, you can have a lot of unlucky quarters. You’ve gotta, you’ve gotta be intelligent and use that for all it’s worth. And, and it’s a lonely road as an entrepreneur. And this is why guys like you and I know each other and we’re involved in some of the, um, organizations that we are because, you know, you’re looking for those like-minded people.

Dylan: And, uh, nothing wrong with my friends and family, but. They think a lot differently than I do. Right? So if I’m, if I’m sitting down at a, uh, at a family, you know, outing or going to a big party, it’s really hard if they’re not real estate nerds again to talk about anything because Yeah, I’m from Detroit, so what am I gonna talk about?

Dylan: The lions? Come on, . Um, so I can’t talk about football, right? And like, all I can think about, just like you said, is, you know, we’re running numbers in our head or, or just thinking about different scenarios or, or things that the average person doesn’t care about. So we’ve gotta find our tribe, right? And you can definitely do that, you know, part-time and, and, and build that out until it’s time for you to leave, um, your, your real gig.

Dylan: But what, um, let’s, let’s lighten it up a little bit. Matt. What is your funniest real estate story of all time?

Mathew: Oh, man. The funniest, gosh, I gotta, a lot, a lot of the stories aren’t funny. , I mean, I, I gotta, sometimes they’re hard, but, uh, I mean, so funny. Um, man, nothing’s coming to mind. I mean, I, I, I, I guess just the, the laugh that I get of, of the relationship with the people that I, I surround myself with and, and, uh, the groups that I’m involved with locally here, and just the camaraderie that I’ve built.

Mathew: There’s not a single moment where I think, oh man, that was, that was just so funny. Um, but it, it, it’s, it’s just the, the day in, day out and the relationships that I’ve built, people going along the same journey with you, that, that really make life. Uh, worth it and, and, and, uh, rewarding, um, just the, the local relationships that I have and, and my family’s super supportive and, and, uh, um, so I can’t think of a specific moment, but it, it’s just the people really that, that are, that make it the best.

Dylan: Yeah. When, when you, um, when you do leave your job, that’s one thing that you’ll miss. So I worked with hundreds of guys. I was in a sales position for years, and sales people are crazy, right? So I was with a bunch of type A, like maniacs that were much older than me. So they would drink and party, and again, this is like 20 years ago, so people were much more.

Dylan: Fun. I don’t know, or crazier back then . And, uh, and then when, when you’re gone, there’s like, I, I had coffee with an investor today and he is like, Hey, I gotta ask you about somebody. And I was like, Ooh, something juicy because I don’t have water cooler talk, right? I don’t have any, like any rumors or whatever.

Dylan: So it was about another investor we know, and he just wanted to know, Hey, what do you know about what this guy’s got going on? Or whatever. Um, but [00:42:00] yeah, you, you, you, um, you do need that camaraderie and uh, I think having those people with you on your journey definitely is a, is a big part of that. So, So you’re, you’re a member of Investor Fuel, right?

Dylan: Right. What does, what does being in, um, kind of a, a, a big mastermind like that, like a high level mastermind, why did, why did you seek one out and, um, and what has it done for you so far in your business?

Mathew: Yeah, that’s a good question because I have a lot of relationships locally. Um, but the, the investors that I know are doing, they’re, they’re either in, um, they’re either in office to office space or they’re in large multi-family.

Mathew: And so, um, I wanted to be involved. In a group for a lot of best practice sharing and, uh, a lot of the what do you do when type situations for investors, frankly, that are smarter than me, that have been doing this for, they’re doing more deals. They’re doing a lot, they’re, they’re making a bigger impact in their communities and what are they doing and how are they doing and how are they doing it?

Mathew: And also, um, the things that I like to. To give to the investor fuel community is, I, I’m a, a buy and hold investor, so that’s a little bit of a, I don’t wholesale properties or flip them. I, so that’s, that’s value that I thought I could bring to the. Because there are, there are, uh, larger, uh, buy and hold investors in the group.

Mathew: But, um, a lot of times it’s, uh, there are a lot of wholesalers and flippers as well, or other people that, that do both. Right. So I, I just felt that it was a good fit for me. That, that it was, there are a lot of really, really smart people that I didn’t have access to locally and I was really, I was very right.

Mathew: I was, you’re, you’re always skeptical when you see the, oh, you know, it’s gonna be so great. You know, oh, it’s the best people. Like, yeah, of course, that’s what everyone says, and it’s your marketing literature. But like I, I went to events. I, I met people, I talked to them, and now I’m using vendors that were referred to me through the group and, and, and I’m, I’m, uh, my, my business has grown, I think a lot in part to the Investor Fuel community.

Mathew: So that’s why I joined. Um, I, I love the group.

Dylan: Yeah. No, that, that’s good to hear. I was the same way. Been in real estate investing for a long, long time. Right. And seen all the gurus and all this other stuff. So when I showed up to my first event, I’m like, all right, if there’s anything weird, I don’t like here, I’m not staying.

Dylan: Yeah. Cause I was like, I was super skeptical and then all of a sudden it was just open arms and, and just people sharing secrets. And it was like, you know, it’s. Um, locally, they’re, they’re, you’re just not gonna find super successful people in like a whole bunch of them. And then a lot of times they kind of have that lone wolf mentality and, you know, I don’t wanna judge them, but they don’t wanna tell you their secrets.

Dylan: And I get that. If you and I live next door to each other and we’re sending letters to the same probate, You know, situations, I don’t want them to be, to mimic each other, but the reality is no one’s gonna be exactly the same as me, and no one’s gonna be exactly the same as you. So I think it’s much more okay, um, to be giving than, than to have to, you know, be restrictive with your information.

Dylan: But that’s the way it’s always gonna be. You know, people are always nervous, uh, because of their competition, but you don’t find that in, in these, you know, in these big groups like investor fuel. Because even if, you know, there’s multiple guys from Pennsylvania, there’s multiple guys from Michigan. I don’t care.

Dylan: I’ll, I’ll share my secrets. Right, because there just becomes, I don’t know if it’s, if it’s a comradery or brotherhood, like I said earlier, but it’s almost like when someone from the group texts or calls me, I have to answer them and I’m like, I’m like compelled to do it. Cause I’m like, oh, Matt wants to know about this like document or whatever.

Dylan: I’m like, I have one of those. So as soon as I get back to the office. I’m gonna dig through my hard drive and send it to ’em because that’s just what you do. You know? Cause we all kind of like made a pledge to each other and it, it’s cool to have that. And you know, I always tell people, even locally, if you’ve just started in real estate investing or if you’re an entrepreneur of any sort, you need to build that mastermind up.

Dylan: It’s different than mentoring Masterminds, you know, can have mentors in there. But it’s really like Matt has this issue. I have this issue. We’ve both solved it different ways, and maybe combining those is, is 10 times more effective? And it’s great to have that ability to, to have people that you at least trust that they’re giving you the best information that they have, and they’re not just sending you in a wild goose chase or something like that.

Dylan: So, um, yeah, it’s, it’s definitely super positive. It’s great to hear that you say that. And, um, you know, it’s meant, it’s meant a lot to my business and, and my personal and, and business. Uh, you. Life myself. Um, so now it’s time for you to, to give your own little commercial. Matt, you focus mostly in, in that Lehigh Valley area, and I don’t want to steal too much of your thunder, but for those who are watching and listening, um, what are you specifically looking for right now as, as far as, uh, real estate goes that you wanna purchase?

Mathew: Sure. So, so if, um, if there’s anyone in Lehigh, Northampton, BES counties that, that, um, has a, a property that, uh, it needs too many repairs or, um, it’s, it was inherited, um, or it’s behind on payments, uh, please. Uh, Please feel free to give me a call. Um, so I, I guess I can give my [00:47:00] number 4 8 4 4 8 4 0 9 7 1.

Dylan: Um, it’ll be down below in, in, in the notes too, so if you guys are listening to this, you can just go to the site and get it.

Dylan: Go ahead. Yeah, but that’s,

Mathew: no, that’s fine. Yeah. Thank you. So, yeah, that, that’s basically, that’s basically what I’m looking to do is to keep growing. Now it’s so many people focus on just, oh, I just wanna do more deals. And, and for me, so I’m from the Lehigh Valley and I’m, I, I was born here, raised here. And I’ve seen what can happen when, um, when cities aren’t doing so well.

Mathew: And so I want to be a part of revitalizing our community. And so this is about, so if anyone has a property that, that they’re looking to sell, I would love to be a part of. And, and I own properties all over the Lehigh Valley and I’m your neighbor, basically. So it’s, it’s, I believe that, that it’s a better selling experience when you’re working directly with your neighbor, someone who’s already invested in your community, who’s not trying to profit off of a situation, but improve the community selling to that person.

Mathew: And so, if, if, if you’re, if you have a property to sell, give us a call. Go to our website and I’d love to talk to you. I can talk to you myself. I’ll come meet you.

Dylan: There you go. You heard it here first. Everybody. If you guys have any properties or deals or want a JV on something in the Lehigh Valley area, then reach out to Matt and his company because they’re top-notch people.

Dylan: And, um, Again, he, he’s, he’s just a happy real estate guy, so somebody that, uh, is definitely someone that you wanna connect with. So, as we wind down, it’s been another episode of Real Estate Investing Secrets on the Flip Nerd Podcast Network. My name’s Dylan Tanaka. I’m your favorite real estate entrepreneur from Metro Detroit, and we will see you on the next episode.

Dylan: Thanks for listening to

today’s show. There are three ways I can help you start or grow your real estate investing business if you’re a new investor In just getting started, the FlipNerd Investor Coaching Program is the most effective program in America. I’ve been coaching and mentoring new real estate investors for 10 years.

And my students have literally purchased thousands and thousands of properties. Many of them started with little to no experience at all. Our program is a Paint by Numbers program where we tell you exactly what to do week by week to make sure that you don’t get distracted on your way to results. We show you how to build a real business, not just create another job for yourself.

New memberships are limited. You can learn more and. Or schedule a call with me and my team at flipper.com/coaching. If you’re an experienced investor doing a minimum of 10 deals a year, up to 500 deals a year or more, or have a multimillion dollar real estate portfolio already, you should check out our powerful Investor Fuel Real Estate investor Mastermind.

Over a hundred of the nation’s leading real estate investors are members, and it’s not uncommon for our. To two to five x their business just from getting around other members At Investor Fuel. At Investor Fuel, each of us are business advisors to one another’s businesses, but we don’t stop at business.

We focus heavily on becoming better people and living fuller lives. If you’re looking for fuel for your business or fuel for your life, please check out investorfuel.com. Applications and interviews are required as most investors are not a fit for our community. Please learn [email protected] if you’re not ready for coaching or masterminds, but eager to start learning more about investing, please join our private Facebook group by visiting FlipNerd.com/facebook. New members get access to free training from us right here at FlipNerd.com. And it’s a community. To safely ask your questions, a great place to get started, simply go to FlipNerd.com/facebook to request your access today.