From Sleeping in His Car to Making $4,000/Month Cash Flow

0:00If real estate investing feels out of reach, like something people with money do, this episode might change that. Sebastian Rodriguez was sleeping in his car, had maxed out his credit cards, and barely spoke English. Yet he was able to build his own rental portfolio in just six years. That's right. Sebastian started from zero, but now he owns 13 doors that bring in roughly$4 ,000 a month in cash flow. And today we're uncovering exactly how he got there and how you can do the same no matter your starting point.

0:36This is the Real Estate Rookie Podcast, and I'm Ashley Kerr. And I'm Tony J. Robinson. And let's give a big, warm welcome to Sebastian. Sebastian, thanks for joining us today, brother. Thank you guys for having me here. Happy to be here and happy to share my story. Yes. So take us back in that moment when you were working jobs just to survive and at one point even sleeping in your car. What was going on through your head about money and just the future in general? Yes. Wow. What was going in my head? Going in my head. I was in survival mode. I gotta do what I gotta do. I can still, I feel like it was yesterday.

1:10I can still see those days and feel that no time has happened in between. But I was focused on my number one priority was only to learn the language. I needed to understand, you know, where things are located. I just moved here. I didn't have any network, any language was a big barrier for me. So I needed to understand how to move around, how to talk to people, how to get a job, how to get a house. And it's really scary when you can't communicate properly. So my biggest focus, again, was understanding and learning the language. I did everything possible to just pick up the language as fast as I could.

1:55Two years down the road, I was able and I took the leap of faith to start talking to people, to quit the jobs when I needed to just be in the back, washing the dishes and not talking to anyone. I wanted to be in the front facing the, at least making the mistakes. Like I said it wrong, it doesn't matter. I will learn how to say it. So back then, again, it was so focused on how to survive, how to stay on my own feet. Also, I had a little bit of the victim mentality because this is hard, this is difficult. Why did I do this? Why did I move? I had a good life. I was comfortable in my country so but I believe that all of that took me through you know a better position when I could start learning and seeing that the future wasn't just like that it was just the stepping stone and what I needed to do in that moment so I think that I the struggle was worth it and it taught me a lot but yeah my focus number one was just to learn the language and understand the city, like where to go to get stuff.

3:03Sebastian, when you first moved to the States, where did you land? What part of the country were you in? Yes, I arrived to Boston, Massachusetts. Actually, I arrived to a place, a town here called Worcester. It's about an hour from Boston. And this is exactly what I say. I arrived there. I didn't know anyone. So I thought I was close to Boston. I got a job in Boston. I was working at night. so the transportation was extremely difficult. I didn't consider that. So I was working in Boston, living so far away. I had to take the train every night. I had a situation there where, again, I didn't understand the maps and how the train works.

3:42Everything was completely new. So unfortunately, I had to stay one night on the T-station because I missed the train, and I didn't know how to ask for help. Or I didn't know how to afford an Uber$50 because it was too far away. So things like that is what I go back and say, again, I say I was just focused on like how to stand on my own feet, how to understand where I'm living, where things are located. After that, I moved closer to my job. I started living in the same place, in the same area. So things got a little bit better. But yeah, that's Boston, Massachusetts. And Sebastian, you know, crazy story, you know, that you had to sleep in the train station.

4:22But I guess what was that what was that turning point for you that took you out of? I'm just trying to survive and learn the language into actually thinking about building wealth. The goal, the priority was always to get a better life, right, to improve the life. When I was able to jump into the bank again and enroll into my banking career and be able to speak a little bit better, I realized and I start paying attention again to the money. So I was able to build a little bit of comfort in terms of the income, and that gave me time, right? So it's only three times to get value in life, time, money, or knowledge, right?

5:02So I built the time, so I started learning about real estate. I started understanding more how the money works, the cycle of the money, going through books and podcasts, you guys every single day. and that that gave me the you know the vision of like okay this is not it like it's a better path it's a better way to do things so that turning point was probably when I as Ashley mentioned maxed out my credit cards was lost my apartment I was sleeping in my car I had nowhere to go and I had no family I can't just go and call my castle my aunt hey can I crash into your couch like no I can't so that moment i was like okay i need to do something at the same time i was i found my life partner and when i got engaged things like got serious and i'm like okay i can't just provide i can't just live like this i need something that is gonna give me a better future right whatever it takes i'll do it so that's when i after struggling and understanding stocks and other type of investments.

6:12I used to lend money. But real estate was the best way that I found that was real. That was something tangible, something that you can play a long term game, not just something that you get in and out quickly. So that's when I understood and I decided to go all in into real estate. Now that you've realized that and you've come to that point in your life, what were some of the first action steps you took when you decided real estate was going to be your wealth generator? Many. One of the first ones was to delete the victim mentality and changing the typical, I'm coming back from work, I'm tired, I just need to go to my couch and watch Netflix.

6:55Like, no, that needed to change. I could also watch Netflix, but an hour prior to that, I could just analyze two deals. So one of my rule number one since long time ago was to analyze two deals every day i will go through mls i go and pull two addresses see the market and start understanding i didn't know anything but little by little i was like oh i kind of know what a house will go from from that area i kind of know what the taxes look like so this type of like small habits the change in my day by day oh i'm tired i'm just gonna go home and sleep no you need to put 110 10 percent uh now the schedule is way different so now i can relax a little bit better but back then it's all in um i don't know another really good habit is like reading i was never the person who used to read and take a book and like it wasn't my my biggest uh i don't know skill but after reading a few books and paying attention to the podcast and stuff i'm like wow this book is like the recipe, like just follow it, like follow exactly what he's saying.

8:04And it's going to work. It's going to happen. So I believe those two habits were big, big in my, I don't know, back in the time when I was struggling. Starting something new is terrifying. When I launched my business, I kept thinking, what if I fail? What if no one listens? Taking that leap was one of the best decisions I made. Shopify powers 10 % of all U.S. e-commerce with ready to use templates, AI tools that write product descriptions and that iconic purple shop pay button with the best converting checkout on the planet. It's time to turn those what-its into cha-chings with Shopify today. Sign up for your$1 per month trial today at shopify.com slash rookie.

8:43Go to shopify.com slash rookie. That's shopify.com slash rookie. Here's the thing about traveling. If you buy food at the airport, a burrito, salad, bag of peanuts, you start wondering if you should have opened a savings account for snacks. So wouldn't it be great if you could actually earn money while you're traveling? Well, you can. Airbnb has something called the co-host network. While you're away, you can hire a vetted local co-host with hosting experience to help take care of things. Communicating with guests, preparing your space, managing reservations. Everything runs smoothly while you're off making memories.

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10:30It automates your rent collection and uses AI-powered bookkeeping to auto-tag transactions for instant cash flow, visibility, and reporting. Plus, they have tons of other features like recurring payments, multi-user access, and free wires to save you more time and money. Spend less managing your money and more time growing your portfolio. Ready to automate the busy work and get back to investing? Baseline is giving BiggerPockets listeners an exclusive$100 bonus when you sign up at baseline.com slash biggerpockets. Okay, welcome back. So you're hustling, you've got the mindset, and then comes the big leap.

11:09your very first property. So this was in Philadelphia. Walk us through that first Philly deal step by step, just the purchase price, the rental cost, ARV, and what the numbers look like today. Just before going into the deal, I will say that that was the struggle number one. While I was analyzing deals, I realized that I couldn't afford a house in my market. So that was my first big wall that I had to figure it out how to how to overcome because of that I start saying okay this is not it I need to find a way to invest somewhere else and the good thing about the States is that you guys are you guys can do things over the phone you don't need to go there it's really good in that sense so I found the book you know long long term long distance investment and I just follow what the book said i found i picked a few markets found philadelphia's the one that is good uh and my in my research and then i start putting offers there so it was another i will say another level because you start analyzing against something out of state so now you your picture your satellite view is even bigger because it's not only just the house and you can fix everything because you're right there you need to trust the agent you need to find the contractor you So things get more complicated.

12:33But the deal, how it looks like, we bought, we land on our first property on MLS,$64 ,000. The property was just full of trash and smell. But here's one of my rookies, I don't know, advice. Smelled like money. The house was full of trash, full of bad stuff. It smells bad, I know. But once we cleaned it up, it was in great condition. We put only$7 ,000. We rented out right away. That was through the pandemic time. So we got an excellent rate, like 3%, something like that. The rent was around$950. And the mortgage back then was around$450. Today, the property ARV is probably around$180. The rent is$1 ,200.

13:22And we still hold the note. And I'm going to hold that note forever. I will never refine that note. That was my first deal. You're renting this property today for$1 ,200 and your mortgage payment is$550. And I'm assuming that's escrow too, so insurance and property taxes? Correct. Wow, that's incredible. And you only put$7 ,000 into the rehab of this property too. Yes. Well, that's a great first deal. Does that get you addicted then to this market? Absolutely. Absolutely. But also really big, big learning lessons from that deal. Like it's my, my, the first door that we bought. And through this door, we learned how to evict someone, how to help someone.

14:05One of the tenants passed away and we had to deal with the, I didn't know. I didn't have any of those situations, you know, even close to my worst case scenario. So again, it's, it's not only, this is what I always say, like perfection, like speed beat perfection. I didn't know. But if I wouldn't bought it back then, I probably wouldn't have it today and I wouldn't experience all of that. I wouldn't learn and earn all this, I don't know, knowledge. So I think that's the most important is like take action and do it right. As long as the numbers look well, look good and you're you're safe. Just just take it and learn, you know, learn a lot.

14:46On that note, Sebastian, and you're kind of hitting on my next question. there are a lot of rookies who are listening right now who have listened to the podcast, who've watched the YouTube videos, they read the same book that you read, they've analyzed deals, but they're still stuck in analysis paralysis. What do you think you did that allowed you to go from not only investing in your backyard, but investing long distance, but being able to find the deal and actually pull the trigger on something? What were you saying to yourself to say, I've actually got to move forward. I got to stop just listening and watching.

15:22One of the first things that I will say is like everyone has to be able to measure their risk. I am a risk taker person, or at least I am able to manage some type of pressure and risk. Other people can't. That's completely okay. But when you're in the analysis paralysis, you probably know ready to pull the trigger because you're scared of something. So measure the risk, run the numbers, see what's the worst case scenario. And think about that. Never be super positive. Oh, this is going to run three times higher because my renovation are going to be better. Like probably not be conservative, be positive, but be conservative.

16:04So if anything goes south, you still, okay. You still able to learn and move on. The most important thing is like, make sure that this is when you say, Hey, are you, you're going to be a real estate investor? or you want to buy a property, feel that hell yes, like that fire in you. Yes, I want to do it. If you do it like that, no matter what challenge you face, you're going to be able to fix it or work around. But if you, since the beginning, you feel like, yeah, maybe no, maybe this is not my right. You clearly, it's something there is some type of risk that you don't want to take. Don't take it.

16:39Maybe you can be, I don't know, a silent partner in a syndication. You can always find a strategy or a way to invest. But if you feel stuck there and you can't pull the trigger, maybe step back and see what other options you have. Where do you feel more comfortable taking some of the risk? And work around. Maybe down the road, you will be more willing to take risk. Going forward, did you have to change your buy box or any of your criteria? Because maybe you would find that golden deal and that wasn't working anymore? Explain those next steps to explain like your buy box, your strategy going forward after that first deal.

17:19Yes, that's a great question. Something really, really important that I will, if anyone can take something out of this conversation is understand your market. You need to know where you buy. Even if it's far away, you can't see it. So you need to understand where you buy. through this five years, six years of investment investing. Um, at the beginning, we were just forcing to happen. Like we were all in, we were like, buy any property. We don't know, we don't care. We just, we just want to do it. But I realized that that's not the right approach. You need to understand what you're buying. You need to run your numbers.

17:56So if you focus on your buy box now, today, I only buy raw single family house on their 1300 square feet, three bed, one bath with a basement and a specific zip code 19144 those that to reach that point it took me five years because before i was just okay it's a deal here but maybe here and also here and my contractor was going all around all of that counts so through through these years of investment investing, you will find better markets if you keep repeating the same. So stay on the same single family house for quite a while. Don't go single family house, 20 unit building, commercial building.

18:44I probably wouldn't recommend that. Some other people do it and it works for them. That's amazing. But if you want to do it, you know, a little more conservative, understand first where you're buying, building the buy box. That's my number one priority. And Sebastian, I appreciate you saying that it took you five years to land on the very specific buy box that you have right now, because I do think that your buy box will change and adjust and get tighter as you do more deals. And for all of the rookies that are listening, you don't necessarily need to start with a buy box that's as specific as what Sebastian has right now, where, you know, he said, row house, single family, three bedrooms, one bath, basement, this very specific zip code.

19:30If you can, great, but just know that you can build that specificity as you start to do more deals. And Sebastian, I'm assuming that the reason that you have such a tight buy box is because you spent enough time looking at other deals and you found what actually works in your specific market. So I think that's the lesson for the rookies that are listening is the more you do, the easier it becomes to identify what your buy box should be. If you guys need help creating your buy box too, we actually have a worksheet for you with just a huge list of all the things you should think about. Like, do you want a pool or not?

20:01How many bedrooms is your range? What age of house do you want? All of these things to kind of give you an idea of what to think about when you're building out your buy box. And you can go to biggerpockets.com slash rookie resource and you can find it in there, the buy box template. So Sebastian, buy box is one of the things that maybe was not necessarily a mistake, but something that's evolved for you. But I guess were there any other mistakes from that first deal that have changed the way that you've invested since then? Yes. The other one is not be prepared for what comes. So I was only focused on like, OK, I want to close in a property.

20:37I want to make sure that we close. And once we close, what? Didn't have the contractors line up on time. I didn't. So it took me a lot of time working through that property. Right. So buying the materials, we had to hire two different general contractors and things started going like south and all of that cost me money. Holding costs every month. I have to pay for that mortgage. I have to pay for that property. So the ability to understand, to see or have a vision of what you're gonna do but have a specific plan and a step-by-step is really important okay building SOPs we closed today we just closed in a property last Wednesday we closed on Wednesday by Thursday we need to get a new locks it's the SOP no next week no no but the next day the first time we didn't do that so contractor calls it like oh I'm sorry someone came to the house and stole everything.

21:38How do you know? Sure, that happens. It's a hit on me. But again, it's a learning experience. Okay, I'm not going to do that twice. So having a specific like building those SOPs or like step by step what to do when it's also really important for the business. No, just focus on let's bought the property and that's it. So Sebastian, you touched a little bit on like, having the crew lined up as soon as you're closing on a property. What else has maybe changed about your rehab process from that first deal to how you operate today? In terms of the rehab process, this is funny because the first time we used to, for example, paint and clean and do other stuff before we do the electrical.

22:24So stuff like that is where we need to understand how to do it. what goes first so electrical h-bags you know pulling permits all that stuff has to go first before you even start working um again i learned that through the hard way and we had to pay some fines and got fined from the city uh some violations so that also again it's more like thinking what's the business after not just focus on the property so you need to have a buy the materials in bulk that will save you a lot of money, understand the time that the property is going to be sitting after you list it for sale, or how the refinance process works, or who's going to be your hard money lender, or the person who's going to...

23:10So many... I would say everything changed. I do not operate as the first property that we bought. That was far away. We have to take a short break. But when we come back, we're going to find out more about Private Money Machine that actually started to fuel your portfolio. Right after this, we'll be right back. Wouldn't it be great if your houseplants paid rent while you were out of town? I mean, they've got the whole place to themselves. Lots of sunlight, zero responsibilities. But no, they just sit there waiting for someone to spray them with some cool mist like a bunch of leafy loafers. But guess what?

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27:35So what was the very first conversation you had when you tried to raise private money? How did you approach it? It's a great question. It's something really interesting. As I mentioned before, it's only three ways that you can add value to someone. Money, knowledge, or time. Back then, my first door and up to today, we still are partners, but we started being friends. So back then, I just had the time. So I started getting the knowledge. I had zero credit, zero money, nothing. but my partner had everything else so I start analyzing those properties I start finding the opportunities and then I show it to him right he says yes let's do it I didn't approach and this is what I always say you don't you can't approach this conversation as like I'm begging you for money you have to understand what are you doing be confident on yourself but also showing us an opportunity.

28:29This is the opportunity. Do you want to take it? Another big lesson here. If it's no, it's okay. Think as a no yet. More no's that you go through closer to the yes. So 20 people will tell you no. The 21st or 21st, I'm going to tell you yes. So be real. Having those conversations is typically scary because the approach is like, oh, would you lend me some money? Do you think you can help me with this? Those were the conversations at the beginning. But again, because I was clear, transparent, honest with this friend, he was seeing what I was doing and he saw the value in me and I gave him what he didn't have, the time.