Live-In Flips and 1500 Days to Financial Freedom with Mindy and Carl Jensen

Live-In Flips and 1500 Days to Financial Freedom with Mindy and Carl Jensen

Carl Jensen – Creator of the blog 1500Days.com and Mindy Jensen – Co-Host of Bigger Pockets Money podcast talk to Neil Henderson and Brittany Henderson, the hosts of The Road to Family Freedom podcast. Find out how Carl and Mindy Jensen created financial freedom before the age of 50, making changes in their lives to engineer that freedom, and their experiences of living in the properties that they sell.

 

Post-Interview Analysis

  • Key Lessons Learned: Look at what you are buying and plan it out towards your end goal and work backwards. Always have multiple exit strategies. Talk with your significant others about your goals.
  • How did they acquire their knowledge or what knowledge did they need to acquire? They did research, read books, watched YouTube videos, and learned by doing.
  • How much money did it take to get started? They went in with a traditional mortgage but they didn’t get into the specifics of it.
  • How much time does it take now? They appear to be working full-time. Mindy is a real estate agent and she works for Bigger Pockets. Carl is working on the flips and they own a co-working space. It is what they love so it doesn’t totally feel like work.
  • Could they do this strategy from anywhere in the world? Theoretically, it would be hard to do their strategy from anywhere in the world.

Episode Highlights:

  • Schedule a video chat with Neil Henderson at roadtofamilyfreedom.com/connect
  • What was it like when Carl told Mindy he wanted to retire in 1500 days?
  • How was Carl introduced to the idea of early retirement?
  • Communication and conversation are key when letting your partner know you want a career change.
  • What was it like moving to the same town as the home of the Mr. Money Mustache financial freedom blog?
  • Why did Carl decide to invest in individual real estate deals instead of individual stocks?
  • What does ‘live and flip’ look like?
  • They have been living in their properties instead of trying to flip right away.
  • Their holding costs are paying down their mortgage, building equity, and taking a tax deduction if they itemize their mortgage interest.
  • Are they using traditional bank financing to purchase their property?
  • They are going to try AirBnB vacation short-term rentals.
  • What do they do to maximize their homes for sale?
  • A clean house is going to show to buyers better than a cluttered house.
  • A good person can make a bad deal good.
  • When you do what you are passionate about you tend to do a great job at it and people then tend to want to pay for you it.

 

Books and Resources Mentioned:

Mindy Jensen’s Email: mindy@biggerpockets.com

Transcript
Mindy Jensen:

Communication is so key just in marriage in general. But if you have been going down a certain road, and then all of a sudden you want to make a U turn, or you know a right turn, you have to say this to the person that you're with. Because they might not be on the same page, they probably aren't on the same page, and you can't read minds.

Neil Henderson:

I'm Neil and I'm Brittany, we are a family on a journey towards financial and location independence. Each week, we interview successful real estate entrepreneurs about their chosen investment strategy, and rate it based on how much money it took to get started, how long it took to educate themselves, how passive it is, and whether or not they could do it from anywhere in the world.

Brittany Henderson:

Welcome to the road to family freedom. If you like our show, the easiest way for you to give back is to leave us a rating and review on iTunes head on over to rode family freedom comm slash review for links and instructions on how to do that we would be so grateful. All right, and that thought of us Let's hit the road to family freedom.

Neil Henderson:

Hey guys, Neil, here. Before we get to this week's show, I want to make you an offer. You can do a video chat with me. It's completely free. There's no pitch is not a sales pitch. I don't have any kind of a mentoring program. I'm not selling anything. This is literally just a way for me to connect with other real estate investors. And being a working, working dad with a son at home. This is much easier for me to do than trying to go to a couple of real estate meetups a week. So again, if you're interested in anything you want to talk about, if you're an experienced investor, brand new investor, we can talk about anything and everything you want to talk about with real estate investing. Just go to road to family freedom, comm slash connect and fill out the form there to schedule a call and I look forward to speaking with you. So let's get to the show. Greetings, friends and families. I'm Neil and I'm Brittany and you're listening to the road to family freedom podcast. Our guest and her husband have achieved financial independence before the age of 50. He is the creator of the blog 1500 days calm and she is the co host of the BiggerPockets money podcast. She's also best friends with Alex felice, Mindy and Carl Jensen. Welcome to the road to family freedom.

Mindy Jensen:

How much did he pay you to drop his name?

Neil Henderson:

I cannot disclose such information. I've signed a nondisclosure.

Brittany Henderson:

I'm not sure it means anything. People know Alex Felice. He was on our first ever episode. enough people

Neil Henderson:

know Alex Felice and joking. I don't really care.

Brittany Henderson:

Oh, Alex,

Mindy Jensen:

if you've met him once, you will never forget him. I am very excited to be here. Neil. And Brittany, thank you so much for having us. Yes.

Unknown Speaker:

Thank you.

Neil Henderson 0:52

Yep. All right. So let's we're gonna go into your background a little bit. Let's rewind the clock a little bit to 2013 Mindy. Carl is a software developer earning a good wage, but you know, he's hating life. He's stressed, stressed at his job. And after an extraordinarily bad day at work. He searches Google for how can I retire early, which leads him to the blog for mister money mustache? Now the story I've heard is that he immediately comes downstairs and tells you he wants to retire early. But not just early. But in 1500 days, Can you recall how you felt when Carl face first came downstairs and told you his plan?

Mindy Jensen:

Do it because you are miserable at your job. He was really, really, really stressed out he was a computer programmer, but he was writing software for the the thing that gives you the chooses a unit of blood so that you don't die. So there's a bit more pressure than just you know, connecting to people on Facebook. He's actually choosing bloods that choosing blood that is compatible with your Rh factor and your blood type and all these other things that I don't know anything about. And there was a bug in the code or they thought there was a bug in the code. There wasn't a bug, I want to make sure that's very clear, because it sounds sounds like you're a bad programmer when it's Oh, there's a bug in the code. There's always this not in his code meal. But they thought there was this bug in the code and he was just having these massive panic attacks in this like anxiety. I can't live this way for another 40 years. And you know, I was there I was a stay at home mom at the time. I saw him going through this and I'm like, you have to quit your job. We'll figure it out. You know, go do something that isn't so stressful. Yeah,

Unknown Speaker:

I was completely shocked at the time to because I had never heard of early retirement before I googled that and found mister money mustache. And when I found his blog initially, I'm like, What kinda it first i thought Wow, I've stumbled upon some kind of internet scam, like no one retires and they're completely ridiculous, but I gave it a chance and read it a little bit more. realized that it was just pretty simple math, and that we could do it. But what shocked me most was I come running down the stairs and tell me this and she's like, Okay, do it, I thought she would think I'm insane and throw me out of the house, of course, or something. So I'm very thankful that we were on the same page with it.

Neil Henderson:

Well, you know, it can be challenging for couples who, when one spouse discovers fire, the fire community or real estate, or both, and suddenly, you know, comes downstairs and says, Hey, if we stop spending all our money and save it all we can we can retire in five years, how does that sound and the reaction isn't always positive. Now, with the two of you, you were already both pretty frugal, and Mindy, you know, with the BiggerPockets money podcast, you probably hear these kinds of stories all the time. How do couples navigate that possible disconnects between where they're at Converse

Unknown Speaker 0:55

conversation?

Neil Henderson:

What

Mindy Jensen:

really communication is so key just in marriage in general, but if you have been going down a certain road, and then all of a sudden, you want to make a U turn, or you know, a right turn, you have to say this to the person that you're with, because they might not be on the same page, they probably aren't on the same page, and you can't read minds. Maybe you can kneel, but fine. So if you want her to know something, you have to tell her. And, you know, I see so many people don't have the conversation, you know, started off with Hey, what do you think our lives look like in 10 years? Where do you want to be? What's your dream thing? and just start that off with not stop spending every penny but more like, look at this idea. Look at this life that we could have if we make little changes, because it doesn't have to be a massive change. I mean, it can be if you're really boatload of money. But it doesn't have to be a massive pain. It can be small fingers that make huge impact on the road. Yeah, I've

Brittany Henderson:

seen you know there's in the when you look at people in the fire community, it seems to be there's a real range of what people do to come to fire you've got mister money mustache, who's probably on the the most extreme end for a lot of people because he's, at least previously, he was very extreme for extreme frugality. That's a great Yes. And then some people just, you know, are more in on like going in on lots of stocks or real estate or anything like that. So it's always interesting to see what people come upon and where they can find that. What works for their family. But I mean, that's really that conversation is kind of where we started because we have all of these goals, and we really can't make them where we're at right now. We can't do the things that we want to do. So it's important.

Neil Henderson:

So you now live in a suburb of Denver, that is also home to Pete adney. mister money mustache? Was that a conscious decision? I have to ask was that a conscious decision to move to Longmont to be closer to the

Brittany Henderson:

Neil's very curious

Unknown Speaker:

voice and kind of listen. So after I discovered the fire movement, like we have to downsize our house, we didn't do a whole lot of major changes. But we weren't happy in the first place with where we lived. We had this ridiculous house, it was almost 5000 square feet. We each had her own toilet, which is pretty nice. But on the other hand, it's kind of ridiculous for people for toilets. So we didn't need this. And I realized if I wanted to make my goal, we should probably downsize. And we weren't happy there. Anyway, we were planning on moving back to the Midwest, where we were from before we had moved back to before we had moved to Denver. So but then I discovered the fire movement. And I'm like, oh, maybe we should give Colorado just one more chance I found this crazy blogger guy this mister money mustache and menu is probably like Reebok. And now he says, this town up in this long round town is pretty great. I'm going to send this guy an email, see if he responds. So I didn't think he would because he was. He's huge now, but he was pretty big back then. But he was like, Hey, why don't you come up to Longmont? I'll give you a tour of the town. I'm like, Oh my god, I can't believe this guy responded backwards. Oh, we did that. And after the tour, we looked at each other and thought, Hey, you know, I think we could make a go of this maybe will run for a while just to make sure we like it. And we didn't end up doing that. But yeah, the rest is history. We ended up buying a house because we got a super cheap deal on a foreclosure and the rest is history. We're almost seven years here now. Right?

Mindy Jensen:

Yeah, almost seven years. So this town is really how would I say this can really shares a lot of the same values that we do. One of the things that when we were on that tour, I had a little girl she was I still have right Little One teenager yet? Yeah, she was three. And we were I was pushing her in the stroller, and we get to the park. And everybody at the park was playing with their kids. And the town that we were living in, it was kind of surreal. When you would go to the park, you would see these moms, like pushing their kids away. No, you go play, this is my time. And it was just so counter to what I believed was the whole reason for having kids. And that park really kind of cemented it to me, there was one woman on the phone, obviously trying to get off the phone, like, yeah, Mom,

Unknown Speaker:

I'm at the park, I'm gonna go and I'm gonna play with my kids now that every other parent there was playing with their kids. And this is the city I want to live in. And the town had a really good library, which I think shows the town has priorities in place.

Mindy Jensen:

Yet the other town didn't even they had a library, but it was open like four hours a day, because they didn't want to pay the funding for library. How that's really just the worst thing ever.

Neil Henderson:

That makes me very sad. I

Brittany Henderson:

already read like three books this year. See what I think about reading?

Neil Henderson:

You know, what one, you know, it's so it is important, I think, you know, we recently interviewed, the frugal engineers, I guess suddenly can't remember her name Elizabeth. And, you know, they talked about they were living in a very high cost of living area. And, you know, they, they basically sat down and they researched all these different, like engineers do all these different categories of what they wanted in the community that they lived in. And, and they ended up first they ended up in Oregon, which was way too high cost of living, and then eventually they ended up in in Laramie, Wyoming. And so, when people think about fire, you know, they get so locked into, how do we make it work here. And if you're living in San Francisco, California, you got a lot, you have a much longer journey to financial independence than somebody who lives in Laramie, Wyoming or Colorado.

Mindy Jensen:

Yes. Although Colorado is getting to be more expensive. Yes, we have been able to find inexpensive housing, we've got a really amazing grocery store that sells fabulously fresh fruits and vegetables, for the same price at almost as much as you can buy as you can grow it yourself in your backyard. And those are your I work two days a week in Denver, and the rest of the time I'm working from home. So like your three big costs are housing, transportation, and food. And we've found ways to mitigate those costs. But I mean, the bottom line is, if you're living in San Francisco, and you want to continue to live in San Francisco, your fine number is going to be significantly more expensive, or more, significantly higher than my phone number, because I live in a lower cost of area, lower cost of living area.

Neil Henderson:

So Carl, you you made a good bit of your net worth investing in individual stocks. But now you're in the process of liquidating a lot of those individual stock positions and going into index funds, but also into individual real estate deals. Can you talk about why you feel more comfortable investing in an individual real, real real estate deal as opposed to investing in an individual stock?

Unknown Speaker:

Yeah, I'd love to sit here and tell you how smart I was because I bought Google when an IP owed which I did August 2004, and $85. And now I think it's close to 2000. And it's split. So it's been huge. I bought Tesla one was in his 20s. We bought Facebook and its 20s at once in the two hundreds Tesla's in the five hundreds. But the truth is, I'm a tech nerd. And I thought these were cool companies. And my strength was I held on to them. So now we've got all these gains. But the issue with individual stocks is you never know, especially with technology, when the company is going to win, there's going to be some some kind of disruption that's going to happen, that's going to make the company irrelevant. This might seem hard to believe, but a lot of technologists say that cell phones aren't going to be a thing in 10 years, everyone will have ear pods or some kind of ambient technology to get their ex messages, maybe some kind of AR goggles, so I don't really feel comfortable in holding stocks. I'm sure 15 years ago, there was a bunch of people who made loads of money from Nokia, her Blackberry, and then Apple came in a third k who could have seen that one come in or you could see Google would be there almost a trillion dollar company now, which is insane, a little search engine that Microsoft tried to buy for $10 billion years ago. So I don't definitely don't feel comfortable holding these individual stocks because while they've done well, you never know when the tide is going to turn and they're not going to be relevant anymore. Real estate is great because I can control all A lot more of it. So yeah, that's what's drawn us to real estate. There's a lot of moving parts to it. But we like to live in flip because we can control our own destiny, and we need a place to live. So we're making money on our primary house. I don't subscribe to the religion of homeownership that people do in America, you have to own a house. I think that's not a good idea for a lot of people. But in our case, a live in flip makes it worthwhile. I think I totally went off on a tangent there. But fine, rephrase your question. If I need to redo that. Now. You you covered

Unknown Speaker:

it. Yeah, not

Unknown Speaker:

really. And

Neil Henderson:

you know, that's what we wanted to dig into. It's a nice segue

Brittany Henderson:

again, yes. It's a great segue. So we have not talked to anybody about living flips. So could you go kind of a little deeper into that and describe to our audience what that looks like?

Unknown Speaker:

Sure. So we buy a house, we try to buy it, there's a lot of moving parts to it. So we evaluate the whole city so long, that was appealing to us, because it's not perfect. There's still a lot of rough edges to it. For example, when we first moved here, there were multiple pawn shops on Main. But what we also saw is the cities on the upswing, there's a very high cost of living area right down the street from us called Boulder, Colorado, and no one can afford that. So they all move to Longmont. So that's number one, we look for a town that's, that's on the upswing, but then we look for a house in a really nice neighborhood. But that's been that but they've been neglected. A lot of people freak out when they see a pink toilet or a blue bathtub or like foil wallpaper, you know, I still freak out when I see wallpaper. Because if there's a pain to deal with, when I see those cosmetic things, a lot of people just don't want to deal with those. And we do so we look for a house with great bones. But that's very cosmetically ugly. And that has things that we can fix up. And hopefully, so a couple years for tax free profit.

Mindy Jensen:

Go ahead. But there are things that we don't want to tackle, like I will not buy a house that has been meth invested. I don't even care if it's been remediated, I don't want to mess house. I don't want to deal with molds. Because we're living in this property. We need to move in really close after we close. And I don't want to deal with a mold situation. A broken foundation can make a home unsafe. It depends on how broken it is. But there's some things it's big, deep issues that we won't tackle. But so for the most part, it is cosmetic, we have added seven stories. That's a lot of work. Alright, but I bet

Brittany Henderson:

I'm curious how I mean, you're You said you're living in these for like a couple years typically. Is that correct?

Mindy Jensen:

Yes. So we live in them at least two years before we sell because then we can take advantage of the section 121 PACs of the tax code that says any capital gains that we realize up to $500,000 as a married couple, or $250,000 of goods single are tax free. So all of my profits, because I have never hit that that pinnacle of $500,000 yet, but all of our profits are nothing tax. They go all into my pocket instead of Uncle Sam's and thankfully, I think I know how to spend them better than Uncle Sam.

Brittany Henderson:

So I again, I'm curious what that looks like. So kind of moving a lot. Do you guys sort of minimize your stuff? Like how do you make that work? so that it's easier? I'm just curious, I don't know if

Unknown Speaker:

we're going to be a really good idea you would think we would do?

Brittany Henderson:

We have kids? I don't know I you know, so that you can only do so much at least from my experience.

Mindy Jensen:

Yes. So I have hoarder tendencies. I am a grandchild of the Great Depression. So you never throw anything away? Because you have you can do something with that. Or I might be able to use that later. And what's something that I really struggle with when we moved into we just moved into our latest live in flip in September. And when we moved in, it was like, why did I pack all this crap. I'm trying so hard to get rid of it. And that would be a really, really great tip. Anybody who's considering this start downsizing now so when you move, you're not moving so much stuff.

Unknown Speaker:

That makes it and we've been doing less of them. Now we have children so we don't want to uproot their lives when we just bought this current one is in the same town. They're going to the same school. So we're not doing it every two years, like we did before, but this probably won't be our last I would say I think every house I like buying a house that I know I can put a little sweat equity equity into and solve for a big profit on the road. Gotcha.

Mindy Jensen:

Yeah. If you're gonna live someplace Anyway, you might as well make money off of it. Yeah,

Brittany Henderson:

yeah. I mean, that's really what house hacking is just so you've got this kind of house hacking, we rent our casita out on Airbnb. And that helps make us money from from our house. And there's, you know, there's always there's a ton of different ways to house hack. I think it's really cool. This is a one, like I said, we haven't really talked about live in flips. And now I'm like, let's do that sounds fun.

Mindy Jensen:

It Oh, it's great fun. It's great fun, because you buy a house that is ugly, or stinky. Because the previous occupants smoked. Or, you know, I just thought I'm a real estate agent, and I just was looking for houses for a client. I saw this one house and like, is every wall brilliant turquoise colored? Like this is really awful colors in the wall? Anybody can paint? Yeah, yeah, it's really not difficult to install flooring. I would I would go with a professional if you're doing carpet. But wood stockpile is not that hard. You can watch a couple YouTube videos and get a really great sample how to do it. You can install wood flooring, and laminate flooring and cabinets seem daunting until you realize that they're actually really easy to install. So there's not that much that difficult. few times that I want to really talk about the houses I won't buy but I'm not getting on the roof and putting down a roof. I will pay somebody to roof my wall and I will definitely spend that money all day long. gutters. gutters are another utter failure.

Neil Henderson:

You don't like ladders very much.

Mindy Jensen:

You know, I actually don't mind the ladder, but the exterior ladder? Not so great. And yeah, I guess most of the exterior work we don't want to do cement is an art. drywall finishing is an art. And when you can like when you have that talent, you can do it really quickly. But when you don't have that talent, you can do it. This takes so much longer. I mean, how long did it take to finish the drywall and manana along?

Unknown Speaker:

Oh, well the pros do it like in two days, they're amazing. If we would have done it, it would have taken us like two millennia. You know that no, people hang hung the drywall like most of it. And madona Yeah, there's Yeah, we did not do that. nor will we ever. And the thing that separates us from other people who do live in flips is we do do most of the work ourselves. So we need to find houses that have things wrong with them that are within our skill level and stuff we want to do. And how we saw people, our best friend is probably the local contractor situation. So for example, our we bought this house to the pool. And that's a whole other story. We got it for a deal because of that, but the pool needs some work. And we talked to a local contractor, he's like, yeah, it's gonna cost about $20,000 to ever replastered and five to have this plumbing thing fixed. So a lot of people will hear stuff like that and dismiss it. But then I go to YouTube and find an epoxy product that I can fix the plumbing line with for $100 instead of 5000. And I can replace or myself, it will be a lot of work for about $2,000. So you have to be strategic about what you do and what you don't do like drywall, does it make sense to pay people to do that, or it does make sense to pay people to do that the gutters, but a lot of the cosmetic work the fancy work, like building a nice shower, redoing the kitchen flooring, you're gonna pay people a lot of money for that. And it's not that hard. We didn't know how to do any of this. 20 years ago, I was a computer guy. And now it's easier than ever when we started doing it, we had to go to this thing called the library to get books on it. And now it's like three seconds away, you just pull up a YouTube video have your iPad or tablet next to you watch the guy on the TV doesn't follow with him.

Brittany Henderson:

Yeah, well, and you're you're living in it. So the things that you know, it can take a while to redo a bathroom or a kitchen just, you know, pure tiling and that kind of stuff. But you have the time because you're living in it, you're not trying to flip it like that, you know, it's it's really something that you can do once you know one room at a time or you know, you can do the pool in a time that makes sense for you rather than in a couple of days trying to find a contractor who's got the time and and where with all to like take it on and do it instead of the 10 other jobs that they're being they're bidding right now.

Unknown Speaker:

It actually here in Colorado, just try to get one that'll return your phone call if you can get someone to return your call or email if you've you've accomplished something.

Unknown Speaker:

I don't know that that's just stuck in Colorado, right?

Neil Henderson:

Yeah, but there's not many honey hungry contractors right now in this economy.

Mindy Jensen:

Exactly. But you know, you bring up a good point is we don't have to do it instantly when you buy a house to flip. The faster you can flip it, the more money you will make with holding costs and all of that but you always need a place to live. So we are in the house already. We have to be here for two years. So we can do it in a strategic manner. You look and you see, oh, somebody is coming to visit, I'm not going to replace the toilet today, I'm going to wait until they're gone. I'm not going to redo the whole bathroom. While I have, you know, my parents in town, I'm going to wait. But, you know, then you, you hold the toilet out because you've got another room with a toilet in it, you put the floor down, and you can take your time and do it right. Because, again, you're not moving out for at least two years. So it's just it's a different timeline. Yeah,

Brittany Henderson:

yeah. Well, I mean, even with the burn method that we've just done on an investment home we bought in Fayetteville. It's kind of like a flip, we had to do that as fast as possible. So we can get a tenant in there and refinance it. Like it's it's not something that we could have been, well, it wasn't near us. But like, if it had been near us, we really wouldn't have been doing any of that ourselves. Because we can't do it fast enough.

Neil Henderson:

Right? Well, in your for you, your holding costs, you know, holding costs are going to be a negative for a house flipper for you, your holding costs are basically you paying down your mortgage and building equity.

Mindy Jensen:

Yes. And taking a tax deduction if I itemize for all of my mortgage interest. So in years past, we've been able to itemize and take the tax deduction with the mortgage interest, which I don't believe you can do on a regular flip. That's just regular income.

Neil Henderson:

Yep. Okay, so not to get all Brandon Turner on you. But I want to do a live in flip. So where do I start? Like, what kind of house Am I looking for?

Unknown Speaker:

What are your skills

Neil Henderson:

I can I can swing a hammer that's about it. And I can do math,

Brittany Henderson:

you can watch a YouTube video and

Neil Henderson:

watch a YouTube video.

Mindy Jensen:

You can paint I believe in you. Hammer, you can install wood flooring. So I have an

Brittany Henderson:

iPhone design.

Mindy Jensen:

That's really important. I actually don't have much of an eye for design. So I partnered with somebody who does have a good eye for design. And that is actually really important because I have seen some houses that were obviously rehabbed, looked around, you're like, What are you thinking? This is so ugly, there's no way this is going to sell. So first, find yourself a good real estate agent if neither of you are and tell them that you are looking for an unattractive but habitable house and start looking at every listing that comes in and you want the smoky house, you may or may not want the cat house.

Brittany Henderson:

just shy away all the chalk charcoal bags just everywhere. Is that? I don't know. That's how I get rid of smells charcoal bags on the charcoal x.

Mindy Jensen:

Let me introduce you to an ozone machine. Yeah, yep. Yeah. 80 $80 on Amazon.

Unknown Speaker:

Yeah. $80. from Amazon. Poof, all the cigarette smell is gone.

Mindy Jensen:

Yeah, so this house is carpeted, almost 100%, we hired a carpet cleaner to come in before we moved in to with a truck mounted carpet cleaning system. And that's important because it's a stronger, stronger machine than the one that you can get at the grocery store. Okay, we hired them, it came in and they cleaned the entire carpet. And probably 75 or 80% of the smell was removed just by them cleaning the carpets. Nice. But there was still definitely it's booked now. So we bought this ozone machine on Amazon for $80. And we turned it on. And in one room, it took one time it was like 30 or 40 minutes, we run the machine and you have to leave the house to do it. I want to make sure that's clear. You can't do it while you're living there. But we we probably ran the machine a total of 10 hours in the house. And now there's no smoke smell. That's amazing. Nobody wanted to buy this house because it smelled the smoke. It's outdated. It has a pool that needs a lot of work. You know, it's not attractive to landlords, because the pool is a liability. It's not attractive for flippers because the pool is a liability in this area. rules aren't cool.

Unknown Speaker:

Yeah. And I would say the most media alluded to this the most difficult part for us about a live in flip is finding the right deal in the first place. So what we like to do is work backwards. So with this house, for example, we looked at it and our first thought was okay, what would this house sell for? in perfect condition if it was all done? So you always start with the end in mind. And it turns out, this one probably could go for 600, maybe a little bit more. And then you think okay, how much work is going to go into it? Maybe 75,000 and then finally, what can we get it for? And we want there to be a buffer in there because nothing goes as you think it would. And plus it's your time. We forgot to buy tile cabinets, flooring, all this stuff, but I'm also going to have to put my time in and a lot People don't take that into account. But my time is valuable. I probably rather be doing, I don't know what else I'd rather be doing. But a hiking or mountain biking or something like norbornene sounds like more fun than then doing a toilet. So I want to make sure there's a big spread in there. So all things being equal, we'll be able to buy this thing, put our money into it, put our time into it. And there's a highly reasonable chance that we'll be able to make at least $100,000 from it. So it's a gamble, I would say the main issue with a long term flip is, it's going to be at least two years before we saw it. And we don't know what the economy is going to be doing in two years from now. No clue there could be another horrible recession. We have no idea. But the great thing about a flip, and maybe the most powerful thing is, if that happens, our worst case scenario is our primary home. We just continue to live here. Yeah, life, life goes on. And we sold in eight years instead of two. And they actually happened to us. We bought a luxury home in 2006. And you know what happened right after that in the market that was hit the hardest where luxury lakefront homes, and we held that back for longer than we thought we would but but it was our primary house. We had to live somewhere. Anyway, so we just enjoyed that home for longer than we had planned.

Neil Henderson:

So you said something mendy a little while ago. That's I think very key which is you're buying a habitable home. Yes, because you know, a flipper can buy a non habitable home and they're going to finance it with hard money and make it habitable a bird someone doing the bur method can buy an unhappy inhabitable home, use hard money or cash or whatever to make it habitable. Are you using traditional bank financing to buy the house? Initially?

Mindy Jensen:

I am because this is my primary residence. So I can get the lowest interest rate loan possible the owner occupied primary residence loan, we have traditionally put down 20%. So we don't pay PMI. But I just helped a guy buy a house. And his PMI is I want to say it's $70 a month, but he would have had to sell stocks to get a 20% like oh, that would have cost me way more to sell the stocks then it would this this pittance 70 $70. So he's actually keeping his PMI. So that's something we're gonna look into in the future. How low can we go down payment while still you know, having a reasonable PMI? I don't think $500 is worth it. A PMI of $500 a month is worth it for me to knock down. But yeah, we traditionally get this a regular old loan and habitable is probably I should put an asterisk in there because with an FHA loan, they want you to have appliances, I believe, or maybe a VA loan, they want you to have appliances in the property. And the last house we bought had a dishwasher and nothing else and it was a foreclosure they left the dishwasher because it didn't work. Well. Thanks. So we had to go buy a whole kitchen full of appliances and have them delivered so that we could get into the property. Well, so we could live there. But like that's not a big deal. I don't consider that uninhabitable but if it didn't have, you know, maybe all the copper pipes were gone. Well, then that's not habitable to me. And I would have to make arrangements to make it habitable. Like the smoke smell in this house made it uninhabitable to me. But I also knew that it was easy to fix. Yeah, yeah.

Neil Henderson:

Gotcha. But the bank is not looking at a smoke smell is uninhabitable. They look at

Mindy Jensen:

Oh, no, actually paid cash for this house because it was set a smoking hot deal. We just didn't want to wait for bank financing to come through. We are in the process of refiling now.

Unknown Speaker:

Gotcha.

Brittany Henderson:

Gotcha. You said you bought it in September?

Unknown Speaker:

Yes. Okay.

Neil Henderson:

And when did you move in?

Mindy Jensen:

We moved in at the end of October. Gotcha.

Neil Henderson:

And you held on to your you held on to that old house which is not normally what you do is that correct?

Mindy Jensen:

That is correct. We normally sell it and then move to the next house but this one we held on to because we bought it for such a low price and the market has increased so much. We can rent it and make money we're renting it right now to three friends and then for a short term until May and then we're going to turn it into an Airbnb and prior handed that and see how that works super awesome.

Brittany Henderson:

Are you going to do it as like a short term vacation rental? Are you looking at like corporate or like longer short term sort of things?

Mindy Jensen:

I think initially we're going to try it just on Airbnb as a vacation rental but I mean if somebody wants to pay me a higher rate and to live there for two months straight, you can reach me at

Brittany Henderson:

talked about doing some of the longer you know corporate rentals. Yeah, like that.

Neil Henderson:

Yeah, you know, the challenge with of course, with short term rentals is just that you the regulatory landscape in the United States is so uncertain, you know, unless you're going to an area that is, that's been doing short term rentals for years and years and years. You know, you never want know, when the city is just gonna go. Yeah, we don't like this anymore. And but you already own it. It already works as a long term rental item, I tend to try to discourage people from buying, like, Hey, I'm going to go to Las Vegas, and I'm gonna buy a short term, buy house for a short term rental. And I'm like, Okay, well, what would it rent? If you tried to rent it long term? Oh, like 1000 bucks, and you're buying it for 200 to $200,000? You're gonna be underwater in a real hurry if the if the if the city changes the rules and says you can't do it anymore.

Mindy Jensen:

Right. And if there is one city that has a strong hotel lobby, I would guess that to be Las Vegas, Nevada. Yeah, yeah. Yeah, you do, you do bring up a really good point. If you don't know your city's Airbnb laws, you need to find them out now, before you buy the property, because they can change on a whim. And they do change on a whim. And, you know, this house will work in a variety of ways. The longer term short term rentals like nurses or the oil and gas industry, or you know, that sort of thing, is a great alternative. What I see a lot of cities doing is limiting the amount of time you can rent to a minimum of 30 days. So he's, you know, the traveling nurses is a good way to bypass that. And they'll, they'll be willing to pay more money per month than a traditional rental because they're not going to be there that long.

Unknown Speaker:

Yes. Important to have backup plans when you invest.

Unknown Speaker:

Absolutely.

Brittany Henderson:

Alright, so what is the most frustrating thing about living in a house? you're flipping?

Unknown Speaker:

Oh, I've got some good stories around this. We want to hear him. Yeah, it's not all it's not all moneybags and granite countertops. There's rough parts. I think this was in the Geneva house. It was like the middle of winter, so it's freezing cold. And if you've ever done drywall work before, it's impossible to do it and not get dust every everywhere. Like you can seal it with like 5000 tarps. And somehow that does, we'll find a way out. So we were working like crazy. We'd be up till midnight, we'd be waking up at 6am to go to our normal job. So life was rough. And Mindy had done the laundry and there was this basket of of laundry. She just done all these clothes nicely folded up and and we're doing this drywall work and it was cold out. It's like 13 degrees outside. So we're freezing and the house we got I go to look at the clothes and there's like a layer of drywall dust on top of the clothes. I think she started crying. It was a low point. And you're living in a construction zone for a lot of this. So we just rehab a bathroom in our office. So it's a pain. Hey, can I come stay in your guest bedroom? Well, you could but our guest bedroom currently as like wires hanging out of the ceiling just don't touch those rows, you might get shocked. So I'm sure we've got lots of other good stories about chaos. Our last house was super cold the furnace went out and like half the house was tarped off so it was cold to begin with. And remember that the furnace went out like January and so yeah, you'll definitely run into you got to be able to be uncomfortable for a while. It's not all terrible, but you're going to live in a construction zone. There's no way around that. What we try to do to mitigate this is plan very carefully and work very, very hard to get projects done very quickly. I'm not afraid of working 12 or 16 hours a day and just nail the kitchen out rip the cabinets out one day rip the tile out the same day and have the kitchen fully functional within a week. That's what we did in our last house and yeah, let me tell you it was a lot of work but it was also nice having that work done quickly so that what horror stories do

Mindy Jensen:

Yeah, well and you know we planned that kitten based on so many other kittens that we have two kids and their favorite person on earth is my sister. So we flew her out to our house. And basically I mean we arranged it in advance but she took care of the kids. But we worked on this so we had already pulled the cabinets off. We had already pulled the pile off the floors. But we had to move a wall we had to we were moving the refrigerator from one part of the kitchen to a different part of the picture though, and then like swapping it with the oven so the last line had to move and the waterline had to move and some of that work couldn't be done in advance but some of it couldn't. So once she got there, we really just made sure we had and we went to Home Depot and bought every piece of you know every PVC fitting. They had So that we didn't have to go. And you know, Oh, I didn't get the two inch to one and one. So now I have to go back, bought it all in advance and then just take it back and return it when you're done. So a little of a lot of pre planning goes a really long way. Yeah, drywall day is the worst day of your life

Unknown Speaker:

was like a hotel.

Mindy Jensen:

You know what I was gonna say, it's like, you gave a bottle of baby powder to a two year old and said, Go crazy. Is it everywhere. So if you're not excited about that you shouldn't because it's horrible. Find a hotel and go to the hotel, let the drywall guys man, make it look beautiful. They're not going to clean up after themselves as well as you would what? They clean up most of the way, then you can go in there with the kids not with you. Just knowing what they're getting into in advance, have a plan when we're doing the kitten have a plan for meals. And if you're going out to dinner, every single night, that's fine. You know, plan that in advance, your crock pot is going to be really, really helpful, your instant pot is going to be really helpful. But just make plans in advance for these life altering repairs that you're doing. You know, if you have two bathrooms, changing out the toilet, and one is no big deal. Don't do them both at the same time. Unless they're both not working. Like that's a silly choice. But if you don't think ahead, maybe you think that we actually had one bathroom, in the beginning, that we didn't remodel that that was just a really ugly bathroom for a long time until we built the other parts. So we could have another place to you know, take a shower, whatever. But planning is definitely your best friend.

Unknown Speaker:

No these problems despite the pain, despite the multiple tetanus shots that I've had to have, it all seems worthwhile. At the end, when you get a huge text free check. All those things fade into the background. Whoo, more money.

Mindy Jensen:

It's like childbirth. When you're going through it. You're like, oh, my goodness, this is so awful. And then they put the baby in your hands and you're like, Oh, I want to do this again. You get that fat check at the end of your life.

Neil Henderson:

all the bad things they can before.

Unknown Speaker:

Yeah, exactly.

Neil Henderson:

Yes. So. So talk a little bit about that process. When it comes time to sell you know, you, you You're a real estate agent, you've written a book about how to sell your house, which remind me the title so people can look it up.

Mindy Jensen:

I believe it's called How to sell your house. Oh, by Mindy Jensen.

Neil Henderson:

By vintage look it up, we'll put it in the show notes. Like talk about that, you know you're living in it? Do you stage it? Are you you know, what kinds of things are you doing to sort of, you know, maximize your profit there on the sale. And

Mindy Jensen:

we have always kept the house extremely clean. I wouldn't say it's staged because you know, if we use our furniture, it's the same stuff that we've got that when you go into a child's bedroom, there isn't crap all over the floor, the carpet vacuum that that is made, everything's put away neatly. And you just a clean house is always going to show much better than cluttered house. So you just keep the whole the whole house clean all the time. As little stuff in the house as possible. You Don't Want a Bookshelf, completely crammed with books, because then it doesn't look like there's any room in that bookshelf. For more books. We bought a house once every closet was so jam packed with clothes, it didn't even know how she bought clothes in or out. Really, really just crammed, didn't make things look airy and light and and spacious and open and you know no pictures of yourself and your kids you want random, you know generic pictures. But yet, keep it clean and be ready to show it at a moment's notice. I'm sure you've seen houses where they say oh 24 hours notice required don't have over hours notice have one hour notice a two hour notice. And then there's always keep it ready to go.

Unknown Speaker:

One unusual tip, which we did that's helped us a ton is get a real estate license mini got her license. And the main point of it was not to help other people buy and sell houses. But it was for us to save on the transaction cost because we knew we'd be doing this over and over again. Especially if you're in a place where a house costs $500,000 3% of your side of the deal is $15,000. You took an online course and got your license for less than $1,000. And a couple months worth of work. I wouldn't recommend doing that unless you're going to do many deals but it's if you are going to do many deals definitely worthwhile.

Neil Henderson:

So now you you've achieved fire. You have opened up the world of accredited investing, and you guys are now able to invest in real estate syndications. When did you start doing that? And can you sort of talk, talk to our audience a little bit about what what that involves and what you like about it, what

Unknown Speaker:

you don't like about it and things like that. Our first one was October 2016 and the main reason we did it was to diversify away from stocks at the time. We did not have any real estate, except for our primary home. So we wanted a little bit of a hedge against stocks. Maybe hedge isn't the right word, but we wanted to be diversified, the stock market's been on an incredible run. And I don't like having all my eggs in one basket. So the syndications we've bought into our value ads, where a company will buy a huge apartment complex, maybe 500 units, they need to raise 10s of millions of dollars. So we could get some money over time, they rehabbed the apartment, they rehabbed the apartments, they might build a new building, make the place better and sell it usually like a five to 10 year timeframe, I think we have about seven or eight of those deals. Now I lost track. The thing I like about them is they're completely hands off, they're completely passive, we don't do a thing after we wire our initial money to them. The thing I don't like about them is you can look at the numbers all day long, but there's so many subjective measures to uh, to, we have one that's actually underperformed and all the numbers like created initially, and it's in a hot area, it's in Texas in a city that's doing really, really well. And I happen to own another syndication like a mile away from this one. That's doing extremely well. So I asked that syndicator Well, why isn't this one doing? Well, he's like, well, that's an A, I would never buy an EP part of town. Even though it's a mile away. It's across the expressways that like they overpaid for that. Everything has a price that makes it worthwhile. But they overpaid for that. And the reason was, the syndicator was unfamiliar with the area, they were from a different state. And this was their first night of state deal. And they fumbled it all their numbers look great, but they didn't get that subjective measure, which was probably more important than anything. They failed on that. So there's a lot of moving parts to it. But after that experience, I like investing with syndicators, who are doing work in their own backyard. I don't like to state deals, and it's gotten very competitive. It's hard to find deals, because there's a lot of people doing this now. So tread carefully.

Mindy Jensen:

Yeah, definitely the the whole, it's difficult to find a good deal. Now. You know, when you look at these two deals on paper that he's talking about in Texas, Oh, those should both really perform well, their projected numbers, I believe were very similar. And they're so close to each other. Oh, that totally makes sense. Like, you know, in your city, on the other side of that Expressway, or, you know, south of Eastern Avenue is, nobody goes there. But the numbers look really great on paper. So, you know, definitely if you're going to consider to with somebody who is investing locally, I think that's a really great tip.

Neil Henderson:

Well in in syndicating some of the smartest people I've ever talked to who are heavily involved in syndication, is that the operator actually makes probably a bigger deal than the actual deal. Finding, finding the operator finding the person to sponsor who's going to be running the deal and finding it and operating it. That's probably a bigger deal than the actual deal. Because somebody, a bad person can make a good deal. go bad, good person can make a bad deal. Good.

Unknown Speaker:

Yeah, I completely agree with that. Find the right person, there's one we use, and I would probably give them money no matter what they did, because they've exceeded all their expectations. And I've met them in person I know they're solid people I know if the deal went bad would be because it wouldn't be because of them would be because something went drastically wrong. There was completely unanticipated, like, some geopolitical conflict or who knows what. Yeah, the person I think is the most important thing for syndication do the operator.

Neil Henderson:

Alright, so my last question. So so often, you know, people have this vision of financial independence and they're thinking, Oh, I'm just gonna sit on a beach and, and drink pina coladas all day long, or I'm just going to snowboard all day long. But one of I think Mindy, your wonderful example of, of what happens when you have sort of removed the pressure of needing to earn the money to To live is that you can now take a little more risks on the kinds of jobs that you take, you can take a job that, that you just love that maybe doesn't pay all that well, or take a job at that startup that is maybe going to be there in five years, or maybe not.

Mindy Jensen:

Yet, I was able to find a job of my dreams. I have had various different careers in my life. And you know, I've never loved a job. I've liked the job. I've hated a lot of jobs. But I've never had one that I was so excited to go to. And you know, I discovered this random website called bigger pockets at a conference. And I went on and I thought, oh, there's no way this is ridiculous. I'm not going to make an account because you know, they're going They'd be like, oh, give us your credit card number, I promise I won't charge you, and then charge me. So I would just go and I would look at this. I love real estate. I just love looking at deals, talking about deals, helping people figure out what's the best way to go. And then they started advertising this job that was perfect for me. And you know, the stars aligned. And now, because we're financially independent. They do happen to pay really well, that I don't have to worry about that. They are an internet startup when it comes down to it. They could fold tomorrow, they're not going to but we could and where would I be I don't have to worry about, you know, working for a solid company that you know, have has a long track record. And this applicant pockets back about bigger pockets. I'm not they are a solid company, and they actually have been around for way longer than you would expect. It's 15 years. But I don't have to worry about the money. And if they closed tomorrow, I could take a step back and like, Oh, well, what else seems kind of cool. Now, I can take dances because, you know, the money's taken care of. And he was able to quit the job that gave him so much stress. And now he spends all of his time doing way too many things. It doesn't have time to work.

Unknown Speaker:

You know, I thought your question yourself, Carl, I thought your question was gonna go in a different direction. Like, where are we working? Because it's kind of surreal. But at this point in our lives, we have all the money we need, we would never have to we could drink pina coladas and snowboard all day. But I think that would be like, I don't actually like vacations because not accomplishing things not working drives me nuts. But now the work we do is for happiness. I could make far more money if I still want to decode and do that. But I like doing tile. I like running this co working space that we own in downtown Longmont. So we're doing the work that makes us happy. And some of it makes money. Some of it doesn't. But that's our measure of why we do work. Now we're not it's good to make money, but we don't have to do it. And that's going to make a greater point with that and no escape me. But we're working for happiness. Now. Our our paycheck is happiness. And if we don't like to do it, just stop. Yeah.

Mindy Jensen:

And that's, you know, that's a really good point, because I'm excited to go to work every day. And I know, anybody listening has had that job where they're like, Oh, my God, my alarm went off again, I hate my job. I don't want to get up. I don't want to take a shower. I don't want to drive to work. I don't want to be here. And I actually feel guilty going to work. Sometimes I'll be leaving the house. You girls are fighting. Girls are fighting. And he's dealing with that. I'm trying to get them to get ready to go to school. And I'm like, yeah, I'm going someplace that I want to go to. Yeah, every time I go to work, I'm excited to go there. On the weekend, I still hop on BiggerPockets forums, because it is literally my favorite website in the history of all websites ever. Yeah. And I can't believe I get the work. Yeah,

Brittany Henderson:

I think that's like the major tenant of fire. It's not it, you know, it can be that you're financially independent, and you can do whatever you want. And also, I think that most people, when they go to that place of I can do whatever I want. It can be work kind of stuff, it can look like work, but it's work that you love, just like you've said, I mean, really, for me, I have trained, I'm a nutritionist, I'm a certified nutritionist, right now, because I work full time. And technically, I'm a nutritionist at the homeopathic clinic that I work at. But, you know, I because I'm working full time, I don't really have a lot of time to do the fun, like recipe development or, you know, talk about stuff on Instagram. And that might not make me money. But if we were financially independent, I could do that more and have it be fun. And it may make me money eventually, you know, could be an influencer. I don't know, I don't care about that. But it's something that I can do. And not feel guilty about it or feel like it's taking away from my family. And I know it's just it's something to say that. it it's it's probably the biggest pro to fire. Maybe besides like just being financially solid and not having to worry about stuff.

Mindy Jensen:

You get to choose the life that you want to live. Yes, yeah.

Unknown Speaker:

Yeah, I was gonna say real quick. When you do the work you love, you tend to do a really good job at it because you're doing what you're passionate about. And when you do a really good job at it, like people will want to pay you for whatever you're doing. So even though you didn't set out to make money, you end up making money anyway, which is kind of how our life turned out which is so surreal and so good. I'm very happy that I write on this blog and I never thought anyone would read it. makes us lots of money, which is crazy. I never saw it coming. And I would do it for free. And I didn't do it for free for three years. So when I made like $1 for the first three years, I paid to do it actually for the hosting and all that. Oh, yeah, I just continued to do the same thing now because I can like,

Neil Henderson:

that's awesome. Well, there, you know, there's a very famous piece of advice, which is, you know, do what you love, and you'll never work a day in your life, which is great advice. However, the problem is do what you love that people will pay you to do. Because I like making pizza. or eating pizza. And you know, you know, people are probably not going to pay me a lot of money to eat.

Unknown Speaker:

I don't know, I can see a YouTube or Instagram account, the pizza guy quick. See if that's taken.

Mindy Jensen:

Oh, the pizza guy who tries all the different kinds of pizza. Yeah, you

Brittany Henderson:

can make it like that. There's a someone I follow that she she's like a home cook. And she loves to make pizza in different ways. And now she has like a pizza podcast with a couple other people. And they do other things. So like, you can really make anything something and and it's but yeah, it's just it. If you enjoy it, you do you're right, Carl, you do it better. And then it becomes valuable, because you're able to do it in a way that that seems more important. You're putting more into it. So

Unknown Speaker:

so I have one very important question. I'm sorry, Neil. I'm gonna hijack your Okay. Well, I'm, I'm a Chicago native. So I am obsessed with pizza. You might know we have deep dish pizza, but what is your it's not pizza? I quit. I'm out. What is your favorite style pizza?

Neil Henderson:

I like you know, I like I like sort of just a normal crust. I like pepperoni, spicy sausage, black olives, and jalapenos. Okay, so

Unknown Speaker:

we are going to be you're in Las Vegas. Correct? Correct. Okay, we're gonna be there in March. Can we buy you a pizza from whatever your favorite? I've been a secret pizza like on the strip, and I've been to some other ones. But yeah, I'd love to taste your favorite pizza in Las Vegas. If you have a favorite one, of course,

Brittany Henderson:

to go out to dinner with you guys. I think maybe domna Marco's might be Yeah, they're a little Italian. So you're gonna say Domino's.

Unknown Speaker:

Oh, no, no, no, no,

Brittany Henderson:

my dad would be delivers. Yeah, no, my dad would be so disappointed if I said that. He he makes pizza we actually my family they came to town for Christmas and Neil's family, his his parents are here and then more of his family came into town. And we did like a pizza night. And he made pizza for everybody. So he usually makes more of the it's not thin crust, the kind of like Italian crust where it has like a nice, nice crust on it. And that's what I like. I like the bread part. I like the toppings as well. But you know the if the dough is well made, that's my favorite part.

Unknown Speaker:

Okay, now speaking,

Brittany Henderson:

yes. All right. Well, and deep dishes is good. You can ignore him. I'm just

Neil Henderson:

joking. I think there's

Unknown Speaker:

got to be one logical person in this.

Neil Henderson:

Well, Carl, Mindy, thank you so much for sharing us with sharing with us today. If any of our guests wants to reach out to you? What would where would they need to go?

Unknown Speaker:

our blog is Mr. 1500. At 1500 days.com.

Mindy Jensen:

You can reach me anyplace on bigger pockets or email me Mindy at BiggerPockets. calm.

Neil Henderson:

Awesome. Well, thanks for joining us today. You guys have a great one.

Mindy Jensen:

Thanks for having us. We had a great time. Have a good one. Thank you.

Neil Henderson:

Okay, that was Mindy and Carl Jensen from 1500 days and bigger pockets money podcast, you know, for you What was the biggest lesson learned?

Brittany Henderson:

I think, what I took away from from this in, I think we can extrapolate this out to almost any deal. But you really want to look at what you're buying. And kind of plan it out. Like look at it for what your end goal is, and then work backwards from there. I mean, really, you should be doing that with just about any real estate that you're buying. But it's just something to be reminded of. And, you know, in this instance, there's different things that you have to look at, is it habitable? Because you're doing a live live in flip, it needs to be habitable. And you also need to have a plan for how to do that, the improvements and you know what you're going to do down the line. So anyway, I think that's just a reminder, that is good to keep in mind.

Neil Henderson:

While I think it's important to always have multiple exit strategies as well. Yeah, we, as we talked briefly about short term rentals, people buying short term rentals in cities that are maybe not necessarily always have not always been friendly to short term rentals, if they're buying it, only to do it as a short term rental. You can get in trouble with if the city ever comes through and goes Yep, can't do that anymore.

Brittany Henderson:

Yeah, yeah. And it's nice to have, you know, that's that With our bird, we have a bird. But we could flip it, we could do it as a short term rental, probably not a vacation rental, but a corporate rental would work. And you know, and maybe a short term rental, or like a vacation rental, I have no idea. We haven't really checked out that, but we have, you know, we have three paths that we can go down that we know, are pretty competent, that we can work with that. So if one of them doesn't work out, you know, for whatever reason, we need to ditch it before we really get a renter in there. We can do that and still make money on it for you, sir.

Neil Henderson:

I, you know, for me, it's more of a overall mindset of financial independence is if you're if you are a married couple, or if you have a significant other, and you want this is something you want to do. You need to have a conversation with your significant other and really talk about where where you want to be in five years, I'm not I'm not big on making like 10 year goals and things like that. I just think things change too much now, but I am five years, four years, three years, two years. One we

Brittany Henderson:

can make like 10 year intentions. Yeah, it'd be sort of a morphus. Like, yes. Things that that, you know, the details might change, but the feelings about what's going on, like this, more, keep the same, like, stay the same. Just the details would change.

Neil Henderson:

Okay, so how did they acquire their knowledge that allows them to do

Brittany Henderson:

their? Yeah, well, they do a lot of research. I mean, early on, it sounds like they, you know, they bought books they did, you know, they looked at and specifically flips, you know, it's a lot of the DIY stuff and learning about real estate and how to buy real estate. So now I think most of is like YouTube, that kind of thing. And then it's just been utilizing the resources that they have to learn it on their own. As far as I know, they didn't have any kind of like mentors or anything that really no,

Unknown Speaker:

help them, they just sort of YouTube was a mentor.

Brittany Henderson:

They DIY that in all of the ways. So money, we didn't really get like super specific with money. We know they down sized.

Neil Henderson:

Yeah, I know, they were, they were already, they were already pretty well on their way to financial independence when they discovered the fire movement, because they're both very, they're both frugal people. And they were savers. And but, you know, for someone, if we're talking just live in flips, you know, it really comes down to you're buying a habitable house. So you can get a traditional mortgage on it. So you know, you can get in for 20% down and avoid the PMI. Or you can go in with an FHA loan, which can go in for as little as I think three and a half percent down. So we didn't get into specific about, you know, what that cost was we didn't get into specifics about the cost of the cost of the materials for the rehab, and yeah, all those now that.

Brittany Henderson:

I mean, I assume that they're buying as low as they can, but keeping it habitable, and then getting as much equity in there as they can it sounded like, you know, if they can make $100,000 off of the property, that was something that they were, I feel like that got mentioned at some point. So it's going to depend on the market, really, what how much you're buying house for the Fayetteville market that we're buying burs and is probably much lower than the market that they're buying. And, of course, they're usually not buying things for cash, they did buy the house that they're currently in from cash for cash, but because you only have to put you know, you can do it as a regular loan, you're only putting a certain amount down, you're able to sort of you can they can then refinance. Yeah, you can have you can have a bigger, you know, you can buy a more expensive property, as long as the numbers work, obviously, for us, because we're doing you know, cash, it can't be a certain like above a certain amount. So, anyway, how much time that they spend on real estate?

Neil Henderson:

I would say a lot. I mean, Mindy's a real estate agent, but she obviously does, she doesn't really do it necessarily to help. She doesn't do it full time to help other people buy homes. Yeah, it was too late to basically say the brand's transactions. Yep. And then she works. She works for bigger pockets, which is a real estate website. And she does that pretty much full time.

Brittany Henderson:

Yeah, yeah. And then Carl is essentially working on the flips and it sounds like he really likes to do the DIY stuff. And then he's also you know, kind of he's they said they own a co working space. And even though that's not strictly like real estate, as far as probably the running of it, I kind of consider that Part of the the thing that I'm, you know, taking care of your investment. So they do it a lot. But as we discussed, they, it's it's what they love. And so it doesn't feel like work.

Neil Henderson:

Yes. Could they do this strategy from anywhere in the world?

Brittany Henderson:

You know, we didn't get into that. But theoretically, I mean, the the world market outside of the United States, I don't know how you would if you would do that or not? I don't know the answer there. But theoretically, you could do this. across the United States, you just have to find the right market?

Neil Henderson:

I think they are. I think it would be hard to do it in the way that they're doing it.

Brittany Henderson:

Yeah. Well, they're living in they would have to, I mean, it's not something you have to pick a spot. And stay there for a while. Yeah, I'm just what I mean is that you can so you, yes. In the short term, you cannot do it anywhere, like, while you're doing it, but you can pick where you're doing it to do it for the long term. So yes, but typically, we are talking about can you do it from anywhere in the world?

Neil Henderson:

Can you be location and location

Brittany Henderson:

independent? And, and they cannot. I will say, however that I'm sure they don't, they're not beholden to someone else. And they're not needing to manage a rental or anything. I mean, they have a rental, but it's strictly, you know, the house that they live in. So they can go on vacations, they can leave it, it's their timeline, so they get to decide, okay, that's, you know, we're taking a break with the renovations and, and, you know, taking a trip around the world and whatever.

Neil Henderson:

So, okay, once again, that was Mindy and Carl Jensen from Mr. 1500. And bigger pockets money podcast. We loved having them, and we look forward to seeing them again, very soon. All right,

Brittany Henderson:

let's hit the road.

Neil Henderson:

I i. And if you like this podcast, we would really appreciate it if you take just a few minutes and leave a review for us on iTunes. It's really simple to do. Just go to road to family freedom comm slash review for links and instructions. Thanks for listening. We're doing this all again next week. Until then, safe travels.

About the author, Neil

Neil Henderson is the co-host of The Road to Family Freedom, a self-storage investor, and avowed proponent of short-term rental house hacking. He founded The Road to Family Freedom to guide busy parents to financial freedom through passive real estate investing.