$65,000/Year in Cash Flow From a 100% Remote Real Estate Portfolio

0:00Brandon Turner:You can build a salary-replacing rental portfolio all from your computer. That's what Bryan Field did, buying rental properties throughout the United States in markets that made the most cash flow. His portfolio of less than 10 rentals produces over$65 ,000 per year in pure profit, and he never even saw most of his properties before he bought them. Brian wanted something that could help replace his 9-to-5 job in the healthcare industry, but buying rentals in San Diego was not going to cut it when the average home price is a million dollars. So, he went where the deals made sense. Arizona, South Dakota, Arkansas, Virginia.

0:38Brandon Turner:He's done long-term rentals, short-term rentals, and even seller financing to buy six units with just$53 ,000 in cash. The best part? He did it all while working from home. The key to his income-producing rental property portfolio, a type of financing that many homeowners in America have access to right now. Let's hear all about that and more as we jump right in.

1:04Brandon Turner:What's going on, everybody? I'm Henry Washington, co-host of The Bigger Pockets Podcast. And today's guest is investor Brian Field from San Diego. Let's bring him on. Mr. Brian Field, welcome to The Bigger Pockets Podcast. Thanks, Henry. Good to see you. Happy to be here, man. Why don't you give us some background? Tell us what you were doing before you got into real estate. Yeah. Before real estate, I've had a pretty lengthy career in healthcare staffing, so placing travel nurses across the country. And so I've had probably about a 10-year career with two or three different companies doing that.

1:37And it's certainly gotten me in a position to be able to buy real estate and make that leap.

1:43Brandon Turner:Is that how you got exposure to real estate investing, like placing travel nurses and other people's investments? Or was there something else that kind of gave you the bug? The bug was wanting to get out of the general nine to five workhorse and, you know, find alternative investments, avenues, things to get me out of W-2 income and corporate employment. So I stumbled across bigger pockets, you know, on online rabbit holes and found an interest for real estate. And so I started my learning journey, all the podcast books, etc. while I was still working there. And then once I started investing, I was like, I put two and two together like, hey, maybe this travel nursing could be a good niche for for what I'm doing.

2:28What year was it when you started like learning and researching? 2017, 2018. And a couple years down the road, we bought a primary house and use that to fund everything else that we've got. Did you buy that primary with investing in mine?

2:46Brandon Turner:Did you plan on it always being an investment down the road or did it just happen that way? Well, the story with that was my wife and I were living in San Diego, priced out of the market based on what we were earning. We had some friends in Arizona. So talking to him about, hey, I'm interested in real estate investing. You're interested in real estate investing, we could work remote with our W-2 job. So we actually were like, let's go plant roots there. Let's buy a primary house. And then from there, we can sort of pick our neighborhoods and work with our friend out there to flip houses, buy rentals.

3:22So we ended up buying that primary to go out there purposefully for real estate investing.

3:27Brandon Turner:Tell us about the numbers on that. What that first primary looked like? Yeah, so we bought it for$3.95. We had been making offers really sight unseen from San Diego with a realtor. People were waiving all the contingencies, all cash. We were up against a lot, but we managed to find one. So we bought it for$3.95. We waived appraisal and inspection. And yeah, it was a nice starter home, three bed, two bath, 1 ,800 square feet, 1990 build. So pretty good shape. You know, it's interesting hearing stories like this because, man, you essentially uprooted your life, moved to a different state, bought a house almost sight unseen.

4:07Brandon Turner:You never saw it in person. You saw pictures and videos. And you did it all with real estate investing in mind. So once you got to your house and you got settled, how long did it take you before you actually bought an actual investment? It took about a year of us being there before we bought our first investment. So while we had that whole year to save up our cash, we were also in this incredible equity ride that the Arizona or Phoenix market saw. So our house a year later appraised for$550. So my wife and I and our friend and his wife, we both pulled out HELOCs on our primary residence. At the time, we could do like 90 or 95 % of the value.

4:53what so we had these massive each of us had like a hundred thousand in heloc funds that we could access and so with that we combined forces and we bought a flip awesome yeah so tell us about that deal what'd you pay for it what did you have to put into it yeah so we bought it uh for 345 okay um it was on the other side of phoenix in a little town called sun city so while we were investing in our own backyard, it was still an hour away from us. We did a full gut renovation. We turned an office into a bedroom, new flooring, new kitchen, new bathrooms, picked out all the tiles. All in all, we probably spent$130 ,000 in renovation and holding costs.

5:40So it was a pretty big one.

5:42Brandon Turner:Were there problems or mishaps that popped up that really taught you something along the way? Because that's a big renovation for a new investor. Yeah, I think there were certainly some missteps, right? So one thing that comes to mind is the idea we had versus the idea the contractor had. We wanted to be very hands on and choose all of our finishes and pick out the color coordination of how everything looked. And our contractor was builder grade, was going to do very basic, basic, basic. And so when we started getting into change orders, that's when we started butting heads. And we didn't expect to have any change orders.

6:23We thought, okay, here's the price that he quoted us and we could go pick within that price. And that just didn't turn out to be the case at all. So lesson learned to make sure that you find a contractor and that you guys are both an understanding of the type of work that you're going to be doing. So yeah, lesson learned there. but certainly a fun one to go for our first deal.

6:46Brandon Turner:135. So I assume that's not what you originally budgeted. Did you go over budget because of the change orders or did you end up pretty close? Oh, we went way over budget. We were probably in the 75, 80 ,000 range. Okay. Renovation probably ended around 90 to 100 and then the extra holding costs, utilities, things like that. So definitely went way over what we had envisioned. Kind of what you're talking about with the managing the expectations with the contractor, Honestly, that's a simple communication issue. We make a lot of assumptions as investors and contractors also make assumptions. And so I think the more open communication that investors can have with their contractors on the front end, the better you're going to be.

7:32Brandon Turner:Usually when I work with a new contractor, those are a lot of things that we're talking about on the front end. As they're giving me a bid, I expect and tell them, hey, I need you to tell me what your assumptions are with this bid. Is this bid assuming we're using a certain type of flooring or a certain type of tile? Is there a variance for me to change it? And when I do the scope of work, it might say LVP flooring. And then at the end of that, I'll put who's responsible for picking the materials, right so we say it on so i'll put my name lvp flooring henry that means i'm gonna pick the flooring and so i can at least have a budget to go pick what i want based on that bid so that way i know if i pick something that's more expensive then my bid is going up from the beginning but man it saved me a lot of time and effort just putting the who's responsible for making the selection because yes i want to pick what style floors we use i don't want to pick the drywall we use, right?

8:30Brandon Turner:Like I need you to go pick that, right? So having that conversation on the front side really helps clear a lot of those things up. All right. Those are great lessons to learn on a first deal because you got to remember your first deal isn't just about profitability. Your first deal is about learning how to do this business. So you paid$345 ,000. You ended up at about$130 ,000 on the renovation. What'd you sell for? Just under$500 ,000 at$497 ,000. And if my math is right, it shows that you were profitable, maybe not hugely profitable, but profitable. So what were you able to walk away with net profit?

9:02It was around$25 ,000 split between my partner and I, and we just kept it and sat on it and we're hoping to roll it into another deal. All right. First flip, I'm going to call it a success, man.

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12:53Brandon Turner:All right, we are back on the BiggerPockets podcast with investor Brian Field, who just told us about his successful first flip with a pretty hefty renovation price tag. But you made money. You learned a lot along the way. So I'm assuming you wanted to repeat that process. But what actually happened next? Yeah. So as life happens, my wife and I had our son and we ended up going back to San Diego where we were still priced out of the market. So the good news is we ended up renting out that primary. So we technically had our first rental after the flip and we were cash flowing like 750 bucks because we had.

13:35That interest rate. Yeah. And rents were skyrocketing because people were not able to buy houses because of all the competition. So moved back to San Diego, had a rental in Arizona, and our course of action sort of led us to out of state where we could buy some more cash flowing assets at a little bit lower of our price point. And so we started researching where to buy and ended up getting our next couple of rentals that way.

14:02Brandon Turner:What went into your evaluation of markets to consider to even invest out of state? Because I guarantee you there's people listening right now who are in San Diego who want to invest out of state and are not quite sure where to start. So this is going to tie back into my corporate W-2 job in healthcare staffing. So COVID was wild. We were working with hospitals across the country. I could see all the travel nurses going to all these different places. My wife also worked in the industry. And so that's what fueled our market exploration was where are we sending nurses and kind of the aha moment for us.

14:41My wife had this account, a hospital in South Dakota. She was booking a lot of nurses there and they were canceling because they couldn't find housing. So a light bulb went off. We started researching, you know, how can we invest in this market to provide housing for nurses that don't cancel and they can go serve the patients and be a win-win, right? So that's how we got into the exploration of the different markets was where the nurse is going outside of California and more of the affordable markets.

15:16Brandon Turner:First of all, that's really cool. A really smart thing to do because you're leveraging your expertise to try to pick a market. And in terms of affordability, what did that mean to you? What did a property cost in that market? Yeah, so we bought our first duplex there at$130 ,000. 130 ,000? Is that like a duplex that needed a ton of work or is that like a duplex that's turnkey? It could have been lived in right away, but we renovated it and we actually did a partial burr. So it worked out in our favor. And, you know, I think 130, what did we put into it? Another 30 or 40 ,000 and just the flooring, kitchens, paints, fixtures, a lot of the basic stuff.

16:01and then we reappraised for hire, took out some cash and ended up renting it out.

16:07Brandon Turner:Sounds good. Like buy something for$130, spend$30 on a renovation and then rent it out. But you didn't live there. So what was the process like of even finding contractors and managing a renovation from that far away? Yeah. So I've always been about referrals, right? So I naturally, when you're looking for investment properties, I'm on Zillow, right? And I'm looking at places and I'm thinking the numbers, right? Look okay, but I'm not sure. And so I just called a couple different real estate brokers, started telling my story, telling them what I wanted to do, narrowed it down to one or two brokers and had them both looking for deals for me.

16:50And they helped it pencil and make sense. And so from there, that person also ended up having a property management leg. And then they had a ton of different contractors. So really, it was the broker agent that referred us to everyone we needed out there.

17:06Brandon Turner:So you paid$130 ,000. You put about$30 ,000,$35 ,000 in it. So you're all in$160 ,000,$165 ,000. What kind of rent were you getting out of this thing? So they were both two bed, one bath, and we got about$900 ,000 a unit for those. So$1 ,800 ,000. That's a solid deal, man. It's a solid cash flowing deal. Now you place travel nurses. Did you not want to do a furnished rental in this? So this is the caveat that we learned after doing the renovations. The realtor, investor realtor was like, you know, you could get really good rents for this completed unit for a long term tenant. And you don't have to do the management headaches of every month or three months turning over a new tenant.

17:55And you don't have to buy the furniture. So we were like, oh, we were super happy and excited to place travel nurses, but it just penciled out more for us to do long-term tenants at that time after the renovations. And it was, you know, hands off. We, she was going to be the property manager. So we just ended up taking that route. And it was probably for the better too, that we didn't have to invest the extra and the furniture and all that. So I like that.

18:19Brandon Turner:I like that you evaluated it after you bought it. You didn't just throw furniture in there and hope for the best. You said, hey, long term tenants, I'm going to get good enough rent. You're cash flowing. That's that's awesome, man. Great deal. And way to pull off a out of state renovation while you're living in San Diego with a wife and a new baby. That's a that's impressive on its own. So what did you do next? Did you keep buying in South Dakota or did you move to somewhere else and buy somewhere else again? Yeah, I think I took a chapter out of your playbook, Henry, and I've listened to you guys for so long.

18:54I know you're in Arkansas. I had been listening. I started looking in Arkansas. Your Fayetteville market was a little bit overpriced. It's expensive.

19:03Brandon Turner:It's getting more expensive. I got to shut up. I keep talking about it and the prices keep going up. Yeah. You had mentioned though, I think it was one of your podcasts about sleeper markets and you guys kind of pull data and you had mentioned Jonesboro, Arkansas. you actually led me to invest in Jonesboro, Arkansas. All right. So let's hear it. Jonesboro, Arkansas. What did you end up looking for? And then what did you end up actually buying? I was looking for small multifamily and I was specifically trying to get seller finance deals at this time. I wanted to use a combination of our HELOC and seller financing because interest rates were at this time back up to the six and seven percent, I believe.

19:49So nothing was penciling super great via traditional financing or DSCR even. So I made a ton of calls. I was cold calling owners of buildings via LLC search online. I was Google mapping buildings that I saw of multifamily and finding out their LLC and calling them and saying, Hey, I'm looking to invest. I was wondering if you had anything you're potentially trying to offload. And after a couple hundred calls, I found an agent investor who was willing to sell or finance me some of her properties. So that's exactly what happened next for us.