The “Escape Corporate” Rental Property Plan I Followed to “Retire” in My 30s

0:00Matt McCurdy:15 years ago, Matt McCurdy had everything most people want. A fresh MBA, a stable corporate job, and a clear path to retirement in 30 years. There was just one problem. He didn't want to wait 30 years. So he sat down, wrote a business plan for real estate investing, and bought his first rental property. Then he bought a few more. When his stable job became not so stable and he had to leave his W-2 job a few years later, he didn't panic. he already had a backup plan generating income for him. So he decided to go all in on real estate and continue to build an impressive rental property portfolio.

0:40Matt McCurdy:Today, Matt owns more than 50 properties and has achieved financial freedom decades earlier than he would have if he had stayed in that cubicle. Matt took his financial future into his own hands instead of relying on a corporation. And you can do the same thing. Keep watching to find out how.

1:01Hey, everyone.

1:02Matt McCurdy:I'm Dave Meyer, Chief Investment Officer at BiggerPockets. Today's show is an investor story with Matt McCurdy from Cedar Rapids, Iowa. Matt's going to share his story of how he escaped the corporate treadmill by buying great cash flowing properties in Cedar Rapids, Iowa. In this show, we'll talk about why he waited almost 18 months to buy his first property, how he navigated a crossroads of whether to stay small or keep scaling, and how he bought 20 homes in a single deal with only$30 ,000 in cash that actually happened. It's a great story, and there are a lot of lessons that all of you can apply to your own investing careers.

1:43Matt McCurdy:So let's bring on Matt. Matt, welcome to the BiggerPockets podcast. Thanks so much for being here. Yeah, thanks for having me. I'm excited for our conversation, learn a little bit about your real estate investing journey. Let's start from the beginning. Tell us a little bit about where you were in life when you decided you wanted to get into real estate investing and what brought that on? Well, I was in the typical role that a lot of people are in, in corporate America, grinding away in a desk job, didn't really see a way out of that. I saw a corporate ladder that I was trying to climb, but didn't see it happening as fast as I wanted it to.

2:25So read the book that everyone typically has read, Robert Kiyosaki's book, Rich Dad, Poor Dad. And then it kind of took off from there.

2:36Matt McCurdy:That is a common angle, people reading Rich Dad, Poor Dad. How old were you at the time when you were thinking about this? I think I was 27 when I read that book. And what was your career like? You said it was a desk job. Were you making decent money, just not fulfilling? Yeah, decent job. Call myself middle class. Did a four-year degree from the University of Iowa and moved through two different corporate positions in the supplier management role. So got to manage a lot of suppliers through project schedules, budgets, And from there, just didn't see a way to transition to executive level to make the money I wanted to without going through the mundane manager roles that just grind people out.

3:25So where'd you go from there, Matt? Well, I started with a simple business plan. Speaking of my educational experience, they harped on creating a business plan. And I also saw that through my corporate America experience. So I said, well, if it's working for Fortune 500 companies, it probably would work for me. So that's what I first started with was a simple business plan. I knew I was going to be wrong from the get-go. It took me a year and a half to actually buy my first rental property. But after that, it was plug and play and rinse and repeat and try to go as fast as I could.

4:03Matt McCurdy:I love that. So tell me a little bit why you wrote a business plan. It's not something we hear a lot about in real estate investing. What was in it? And what was the point? If you knew you wanted to do a real estate, like why go through the exercise? It helped me clear up everything that was in my brain and what I was hearing, what I was reading, what I was learning to put it onto paper. Yeah. And once you put that on the paper, there's something that happens between your brain, your nervous system, everything where you are actually committing to this and you're really thinking through it. You can you can have ideas all day long, but it's one thing to be very strategic with what you're trying to do in your business.

4:46And now you're trying to articulate it on the computer or writing it down on paper. Nowadays, it's through AI. Yeah, why not? It's very simple now. So there's really no reason not to do it.

5:02Matt McCurdy:It's a differentiator, right? Absolutely. So few people do it. Whatever format you want to put that in, that doesn't really matter. I think it's the exercise of thinking through all the variables and what you're good at. I love that. I think it's really good advice that people should be following. So once you did that, Matt, what was your first deal? How do you go about actually getting in the game? Yeah. So the first one was a prototypical single family house that was three bedrooms, one and a half bath house in Cedar Rapids, Iowa, not too far from a local elementary and high school. Just location wise, it made a ton of sense.

5:40I wanted to position myself to rent to as many people as I possibly could.

5:46Matt McCurdy:No, I mean, I think especially for your first deal, just trying to get that mass appeal kind of rental where you're not going to have a lot of vacancies, you're going to find a high quality tenant, just makes a lot of sense. What was it like though? Like how much did you buy it for? How did you finance that? Yeah, I bought it for$92 ,000, which sounds ridiculous nowadays. It does. Which still, this kind of shows you where Iowa is at and Cedar Rapids in particular. We're right around probably$225 ,000 to$250 ,000 for that house nowadays. I was always looking to force appreciation. And really through that was just buying a house that needed some work.

6:25So this house needed about$15 ,000 worth of work. Some of it was sweat equity. My fiance and I did at the time. But that was a three-bed, one-and-a-half bath that we made a four-bed, two-bath.

6:39Matt McCurdy:Okay. So you were doing real value-add. This wasn't just like cosmetics. Like you like was doing some structural stuff and you did all the work yourself? No. So I would say half and half. I had a contractor. My actual father-in-law helped me on some stuff too. Nice. Because my wife and I, or my fiance at the time, both of us had W2 jobs. So we were very busy, but we were burning, you know, the candle at both ends, going over there after work, working on weekends, just doing anything and everything, kind of clawing to scratch and claw to get that put together. How long did that take? Well, we closed December 13th and we had a tenant in there January 1st.

7:19Matt McCurdy:Oh, okay. Yeah, we weren't messing around. Yeah, we weren't celebrating the holidays that year. No, we did. We bought this house in December 13th of 2013. We got married January 11th of 2014. So roughly a month later, we went from renovating this house to getting married. I can remember many, many nights, you know, it'd be midnight, one o 'clock and we were just going after, but we're young and stupid, you know? Yeah. I mean, it helps sometimes to be young and stupid, at least in my case. Yeah. Well, good for you. I mean, that's kind of the hustle that it takes, man. This is a lot of times when you're, you're just getting started, you just got to do what it takes.

8:03Matt McCurdy:You know, it's going to be different for everyone, but recruiting your father-in-law, doing the work yourself, figuring out a way to get it funded, that's usually what a first deal looks like. I know a lot of people want to raise private capital or do something advanced, right, to start, but I think the hustle approach is not only the most common way, but often the best way. You learn a lot, you learn what you like, what you don't like, what to avoid in the future, and whether or not, honestly, if you're going to like this business. But I assume since we're talking here today, Matt, that you liked it, even though it sounds like a stressful couple of weeks and a very big push to get this thing open.

8:41Matt McCurdy:It seems like it worked out well for you. I had my idea and I went with it. I'm too stubborn to stop. We had, I learned, speaking of learning some things, I did not scope the sewer line. And that house unfortunately had Orangeburg sewer lines, which people don't know what Orangeburg was. It was this magnificent revolutionary product back in the 60s that they put in a lot of houses for sewer lines. And it was wrapped with some kind of cardboard paper type exterior, which, you know, go figure in the ground, it's eventually going to rot and fall apart. Yeah. So on our honeymoon, I was getting phone calls and I was actually dealing with a collapsed sewer line and tenants that were fortunately patient with me and were able to get some people to help while I was out of state.

9:37Yeah, these are the things you learn, right?

9:39Matt McCurdy:Now I'm sure you get a sewer scope on every deal you do. So sounds like a great first deal, Matt. I want to hear about what you did next, but we got to take a quick break. We'll be right back. As a host, the last thing I want to do or have time for is to play accountant and banker. But that's what I was doing every weekend, flipping between a bunch of apps, bank statements, and receipts, trying to sort it all by property and figure out if I was actually making any money. Then I found Baselain and it takes all of that off my plate. It's BiggerPocket's official banking platform that automatically sorts my transactions, matches receipts, and shows me my cash flow for every property.

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13:59Matt McCurdy:Welcome back to the BiggerPockets podcast. I'm here with investor Matt McCurdy talking about his first deal, how he hustled into a single family home in Cedar Rapids, Iowa. Matt, after that first deal, you know, you had a couple hiccups, but sounds like overall it went well for you. What do you go on and do after that? Unfortunately, I didn't have a bankroll. I didn't have the idea of syndications back then. So I really just used my W-2. I did the old-fashioned way, saved a lot more than I spent. We were living pretty broke just to try to save every dollar because every dollar and cent got me closer to my end goal, which was ultimately to leave corporate America.

14:42So the faster I did that, the quicker I could get to it. So short-term sacrifice equals long-term gain. Oh, yeah. And that's the way I look at it. So 2014, we just bought a couple properties, two single-family houses. And then in 2015, we really scaled up a lot quicker with four duplexes and then I want to say three additional single family houses.

15:06Matt McCurdy:And you were doing that just still with your W-2? So that is part of it. The other part is, unfortunately, my wife, her mom passed away in November of 2013. so we had that on the front end bought that first house and then got married so we had a wow like i said a busy uh couple months but we use some of that life insurance money uh to help pay for the down payment on those four duplexes we still have those four duplexes we still talk about how those are Karen's duplexes. It's just a great way to remember through that. But what we also did was find a different financing, basically a local credit union.

16:00And that loan officer was a lot more aggressive than what I was used to dealing with with the first few properties. And that's something I'll always advocate to do. I'm doing it right now. I'm actually trying to shop around different insurance companies, always trying to shop around, not necessarily rub it in the current people's face that you're doing it, just do it kind of behind the scenes and see if there's other better options out there. And luckily, we were able to find a different loan officer that took a little bigger of a chance with it, did some bridge loan stuff with us and made it work so we could tackle those four it was a bigger bite than i was used to taking buying four duplexes all at the same time but they're all on the same block it tons of synergies there and then really once you hit five or more it starts snowballing where it becomes instead of hundreds of dollars it becomes thousands of dollars and now thousands of dollars just just sounds better yeah it also It's a buys more.

17:04Yeah, it does. It really does. And then every dollar that you're taking from that, especially if you have a W-2 job like I did, it was just compounding so much faster for me.

17:16Matt McCurdy:It really does. Between the equity you're building, the cash flow you're getting, you're saving more money. It really does have an exponential effect. People call everything exponential growth, but it actually can be exponential growth if you're reinvesting your profits in the way that you should. So it sounds like you grew fast, Matt, but you were working at the same time. Your goal, though, was to quit your job. So did you have like a number in mind? Like if I can get to X cash flow a month, I can quit my job and I need Y number of properties to get that cash flow. Is that what you were working towards?

17:53Yeah. And I was just trying to keep it simplistic. I ended up leaving corporate America in 2017 or corporate America left me is how that went but oh do you lost your job uh yeah so they moved my job to corporate headquarters and i didn't really want to move there so fair it didn't really make sense for me to move number one and number two i was planning on leaving in april of 2017 but they actually gave me severance until about april of 2017 isn't it funny how some things work out like that yeah it's like meant to be. It is. So what I was doing around that was like$500 a month per property. Wow.

18:35Okay. So that's what I wanted. I think I had about 20 properties at that point. Oh, so you're making like 10 grand a month in cashflow, which I mean, tax advantage cashflow too.

18:45Matt McCurdy:It's probably more like making 12 grand or 13 grand in W2 income. Yeah. And looking back on it, I was naive, like, oh, is this enough? Because, you know, as real estate investors, we know how much our P &I, principal and interest are, the insurance, the taxes, all those things weren't as crazy as they are now. No, it was much easier. They were more stable. Nowadays, it's a little different. But the big variable was your maintenance and repairs. What's that going to costs? What if like five furnaces go out this year? Oh man. But it still, it still felt weird because I went through the, the American educational system.

19:28We are not taught to become entrepreneurs. We were not taught to be out on our own. We're taught to get good paying jobs and then go retire and then die. It still felt raw and weird, but I bet it's all right.

19:44Matt McCurdy:It's also kind of addicting when you have the cashflow and the W-2 income, it takes a little pressure off the real estate side, at least speaking from experience. Like you have all this income that I think for most people covers your living expenses and then everything else, you could just keep reinvesting and reinvesting. But I'm sure you have to change your strategy a little bit, right? Because now you're living off that cashflow and it's not just pure reinvestment into your portfolio. Absolutely. At first I said I was retired and then I was like, wait a minute, My friends are making fun of me, calling me the retired guy.

20:16And I was like, no, I graduated from corporate America. So I graduated because flash forward to 2018, I was never busier. I couldn't believe how I went from fishing and golfing and trying to fill my time in 2017, see where I would go to just putting on the full throttle in 2018 and acquiring as much as I did. But it was a good reset because I didn't know where I was going to go. I wanted to make sure my numbers were right. I still couldn't believe, you know, that I wasn't going to get hammered with taxes. You know, I was just used to that mindset of the W-2 where you get hammered with taxes. You're meant to kind of be average and work through kind of whatever they tell you to do.

21:05Whatever HR tells you you can have for a raise, whatever they tell you you can have for a bonus, you accept and you move on. And now I've entered a new space where it's up to me what I make. It truly is. And it's - Yeah, it's so liberating. It really is. It's very liberating, but also scary. Where are you going to come up with the money to grow at this point? Where are you going to come up with the money if some of these risks actually come to fruition?