 It's just like anything else though, right? Especially in today's world with social media, there's so many people that just think they're the geniuses of everything. Right. Experience is really where you really, where you learn. I mean, you can collaborate and you can go to seminars and watch YouTube and stuff like that. But until you actually step into the arena and do some deals and really, it isn't till you, you know, do a few bad deals. Yeah, for sure. You know, until you really lose on some deals, what, I mean, I could see what's happening now happening, but, but what's going to happen past, you know, this little period, I mean, who, who in the world knows? I think we're going to have a really incredibly strong spring. I think we'll see a huge rush of buyers, a lot of demand, you know, no inventory, it's going to be crazy. But then what happens after that? And so if you're an investor, I think flipping houses is probably done for right this second. You know, I don't think anybody should buy a house thinking I'm going to flip this. This is episode 30 of Zen and the art of real estate investing with my guest, Ricky Karuth. Ricky, welcome to the show. Thanks so much for being here. My pleasure, bro. My pleasure. Good to be here. Yeah, man. I'm really excited to talk to you because I've been following you for so long on social media, watching what you've been giving away for free. When you first started before it all went bad, were you also licensed as an agent or were you just investing to start? No, I was, our investing was always a secondary, um, something to just kind of do on the side, you know, real estate, being a real estate agent was my primary, you know, I got into the business to be an agent to help people buy and sell real estate and make commissions. And, you know, that's really, that was really kind of the baseline, the foundation of my real estate career. Was it all over leveraged, which is very popular because you, you think it's going to be easy in the beginning. So you think you can do multiple at time. Was it too many or just too much leverage? And then market downturn usually doesn't help. All three. Yeah. So, um, you know, prices were growing up so fast. I was watching so many of my clients were making so much money flipping. Um, and so I had money and, you know, the bank was giving away even more free money at the time. And so it was really easy to get, you know, financing and to get funded to, to go out and buy deals. I would buy deals and sell them and make a ton of money. I mean, I made so much money. Um, and I would, you know, sell a house and then buy two houses, sell those two and buy four houses and I kept building and building and building it up. And, uh, when the market turned, it turned so fast that, you know, for the unexperienced guys like me, I just didn't know which way to turn. I mean, there were people that were 40, 50, 60 years old, going through the same thing I was going through in my early 20s. So I was really grateful for that looking back. And I knew it at the time that, um, that that was going to be really cool. But no, um, I mean, when I, when the market turned, I could not turn around and sell those properties for the profit I had projected. Yeah. And, uh, so, you know, I just kind of held on, uh, depleted my funds, paying the mortgages to hang on to those properties. I sold a lot of them for exactly what I owed and got out from under them. I ended up having to let some of them go back to the bank. And, you know, like I depleted all my cash trying to hang on thinking, you know, it wasn't going to last as long as it did. Yeah. And I depleted all my cash, then I couldn't pay the mortgages and I had to let those go and lost everything. You know, it was, uh, How much time did you take to reset? And then what led you to decide to go right back into it? What did you learn in the, in the between time that helped you go to where you're at 2005 was I sold my last house and I didn't start, you know, um, making money as a real estate agent until 2008, May of 2008, between February 2005 and May 2008, I didn't sell or have any hand in real estate whatsoever. Yeah. Um, so I went back to roofing houses. I landed a job on an oil rig for a year. I was serving tables. I was doing all kinds of different things. Um, but what I learned was that, well, I mean, number one, you, you know, you can't, you know, you have to have a long term, you know, plan, you know, if they, you know, you have to think worst case scenario and then, and then whatever you're getting into, um, you know, it's going to be a home run in worst case scenarios. You know, that's if you're, that's if you're taking investor money or if you're betting everything you have on it, it's got to be worst case scenarios, still a home run. If you've got, um, disposable income that you don't care if you lose. And of course you can go risk that. And if you lose it, who cares and really bet on some high risk, you know, investments, but you know, when you're talking about your livelihood, you really got to have worst case scenario is still, you're still okay. Um, and that's kind of what I wasn't prepared for. Cause I didn't know, I didn't realize. I mean, the golden rule for me growing up was to, to invest in real estate, that's the golden rule, but nobody ever told me there was a right way and a wrong way to do it. And you could actually get caught. Yeah. Um, plus, you know, 2008 was one of those, you know, once in a lifetime type crashes, I think too, that, you know, people didn't even realize that that could even happen. Um, you know, it was just crazy times. So yeah, I just, I learned that as far as being a real estate agent, you know, it's more about, you know, helping people rather than closing deals and building that database and building your name and reputation and your marketing and all that stuff. Yeah. And on the investment side, you just have to be really smart and think worst case scenarios, you know, with money that you can't lose. You know, wouldn't you like in the, I mean, I, I feel the same way. And I know from, from watching stuff that you put out over the years that you really believe in that people to people connection. But I think that like some new investors don't even realize how important that is in the off market game. I mean, to acquire properties and masks, you have to be still good with the people because you have to get them to trust you and you have to be trustworthy. So I love the play of the agent business with investing. And I always wonder like why everyone doesn't have their license. But did you learn a lot just from dealing with the people during that time that helps you in the off market game as well? Yeah, kind of. I mean, you know, it's, it's about people at the end of the day. So, you know, that can carry into the, you know, real estate investing world as well. But real estate investing world is a lot colder. You know, it's just cold hard numbers. These numbers work or they don't. There's definitely the people side to it. But not as much as trying to represent buyers and sellers on their purchases. You know, that's a whole another level. Yeah, it's really two different, you know, it's, it's two different sectors, completely different sectors of, of the industry, you know, it's almost like going and playing Texas hold on, you know, one, two, no limit versus, you know, limit or, you know, two, five or whatever. But, you know, it's two, two, two completely different games versus playing a tournament, you know, those, those all have completely different strategies. Same thing. Yeah, especially asset bases to your asset. If you're going like multi, multi with, you know, hundreds of units, obviously that is going to be full numbers calculation down to, you know, mom and pop flipping is going to be a little bit of a different story, but the numbers always have to work. Yeah, I mean, now with my flips, I pay all cash for my buy them cash and then I fix them and flip them. It's not a game I really love to be in. I just have partners that I love. So I want to maintain those relationships. Otherwise I wouldn't flip it all because like we flipped 100 houses in the last say five years and if we would have kept 30 of the best ones, we would be so much more wealthier. We would have so much cash flow. We would be sitting in such a great position right this second, but we flipped it for, you know, to make 10,000 a piece or whatever. And yeah, the margins are smaller where you are. You're in the golf shores, right? The margins are smaller when you're doing mass flipping. So like if you're, if you're doing a whole flip to generate, you know, 10, 20, 30,000, you have to just do it mass and get them out to make it worth it, right? Well, and I mean, even then it's not really worth it because you're paying all these capital gains taxes, you know. And so that's the, that's the other, that's the flip side to the whole thing. When you keep the property, you're not paying taxes. You get the depreciation, appreciation and cash flow. Whereas when you flip it, you're putting money into it. And then, you know, you're flipping out of it to pay taxes on the gains. You know, so if you go in, if you go in and do and make 10,000 shoot, you made 5,000, you know, right? I don't know. Um, I'm not a huge fan of the flip unless you're in this market or you have these situations where you can make, you know, 100,000 minimum per flip or you make 300,000, you know, or you can make a million dollars on a flip or something, then, then that becomes very interesting, you know. Yeah, I, I mean, I slowed down. I think now I'm looking to at least be at six figures on a flip. Like you said, to make it worth it, but I'm in a market where there's a lot of opportunities for that, you know, and it's just not that easy. When I was in Florida, I was able to find some, but there's plenty of towns where you just, you have to do volume instead of, you know, one off's not going to work on the numbers. Yeah, dude, it's, it's tough where I'm at as far as that goes. So that's why I'm looking like you said in the beginning to go out and, and, uh, you know, venture out beyond my market and try to get out there and, and buy some of these bigger deals, which I feel like are going to come through. I think we're going to see some really good deals on some big commercial deals and some big multifamily deals. You can't just double the cost of debt and, um, you know, in an industry where it is cold, hard numbers and not see some really staggering effects. So yeah, I think we're already seeing signs of, of this happening, you know, in the multifamily sector, um, you know, and we'll see how it all plays out. What's your ideal target asset? Like right now, are you looking for apartment buildings? Are you looking for some cross commercial type of place? Or just right now I'm just looking at, right now I'm just looking at apartments, but I'm not opposed to have a guy that, um, that, you know, and I, and I love commercial. I've got commercial buildings where I live. So I've got, you know, I've got plenty of rentals where I'm at. Duplexes, fourplexes, single families, commercial buildings all over my county, but I don't, it's basically, um, all owned by me. Um, you know, I've got a partner on a couple of them, but you know, what I'm talking about is going out here, finding the deals, raising the money. Yeah. Um, and doing these really big 10, 20, 30, 40, 50 million dollar, um, deals. So we, I've looked at about 50 plus deals in the past six weeks. And, um, you know, we haven't seen anything that we're like, man, that's a home run. Yeah. And that's because prices have just escalated so much. Rents are maxed out. Uh, we're, I think we could possibly see rents continue to maybe go up. But if they do just by such a small number, whereas a lot of these guys are buying these, you know, three and four caps with the expectation they're going to raise rent 20% of here and, um, rents are already maxed out. You know, so if I can find something that rents haven't been, you know, raised in years, two, three years, whatever, there's some deals out there, of course, but man, there's so far in a few between everybody wants an arm and a leg and the cap rates are so small, you know, kind of rate. Yeah. Cap rates, interest rates exceeded cap rates for the first time. It's over months back since, since 2008, just something's going to give there. You can't, like I say, double the debt. You saw the article that there's 175 billion worth of global commercial, um, um, debt that is, uh, that's, that's, that's delinquent right now. You know, that's just a complete, you know, um, red flag right there. You know, that this is the writings on the wall with this, with this big, with these big deals and I think it's going to take a little longer for it all to flush out, um, but I'm just sitting here looking at every deal that comes, comes past me. Um, I get deals throwing at me all day long. Yeah, I bet. But I think, I think, you know, you're showing that, you know, you obviously have the resources to close the deals, but it's so much more important to be patient, especially when people are serving you what they consider are good deals. I feel like sellers are still being stubborn now and at some point, like you said, that's going to break. And then the deals are finally going to start making sense. And it's coming soon. I think I do too. Uh, like I say, we're already seeing the first signs of it, you know, with some of this stuff sitting on the market and you know, um, people aren't interested man, when that's twice as much and even the people that are paying cash. I mean, if you're paying cash, you, you want to, if you're that, if you've got that much capital, you're not going to just going to deploy that into a, into a, into an assets, you know, it's going to come down in value, right? So even the cash buyers, they're, they're wanting deals. So like people know that this, and it's different than residential. Residential is a lot more solid. You know, there's, there's no supply. There's so much demand. We're already seeing multiple offers on properties all over the country. Again. Absolutely. We saw lions this weekend. There was like, you know, like during the pandemic, we saw the huge lines at open houses just because of access was a little bit limited. And it was crazy, but like the lines were back this weekend. That was kind of a shock. Like, okay, it's not what everybody said. Like people are still buying, but you're right. Like commercial as an asset, there's so much large scale commercial available after the pandemic that now it's really for those of us who like it is just waiting out to see when they're going to get realistic. I mean, if somebody told you five years ago that people would be like fighting over five caps, we would have all thrown up. Like back then, everyone's like looking for 10 caps. And now it's like you said, California, three caps sounds good, which is crazy to me. Yeah. No, three cap doesn't sound good. And that's the problem is the people that are buying them, they're going to be in for a rude awakening because if, if the value drops way below where they bought it for. And they're, I mean, even if they, even if they could raise rents, which I just don't think they're not going to go up like they were, even if you could, if that is, in fact, your strategy to say, okay, we bought it out of three cap, all we have to do is raise the rents and then the three cap is now a larger purchase price because the income's higher. Well, all you're doing is, is even if that were the case, like I think best case scenario, you sell that property for what you bought it for at a five cap or a six cap, you know, you raise the income just to get it up to what the cap rate is supposed to be. And then people buy it for exactly what you pay for. But that's best case scenario for those guys. I think what's realistically going to happen is rents aren't going to go up. Now people want to buy that at a five or six cap. So it's worth 50% less than what you bought it for. I think that's the kind of stuff we're going to see out there, some really wild stuff. Yeah. I mean, over the years, what's been like one struggle that you've seen for just general investors? Obviously you're a coach, so you're really trying to help people do the right thing. Where do you see investors getting hung up all the time? I mean, the market's changed a little bit, but there's over your years, where are you seeing like the biggest investor hang up? Oh, I don't know. I think it's different for everybody. You know, you're entry level investors, you're more seasoned guys and everybody in between. You know, people, you know, raising money, you know, there's, I mean, there's people out there that can't raise money, you know, if they want to, and you got people that don't know what they're doing, that's raising money, you know, which also is a very big, very big, which also presents a whole another problem because, you know, it's interesting because right now, syndication is a real, you know, trending, you know, word, people out here are syndicating deals. I have no idea what they're doing. The investors are saying, oh, thank God, I'm finally in on a real estate deal. And, you know, and it's a three cap. And, you know, it's just not going to end well, you know. Yeah, I feel like I was saying a couple of episodes ago, like I feel like some of the bigger syndications are they're good marketers. So they're able to catch the investors with cash who like, oh, this sounds great. But they really, they don't have like, they don't even have as much money as everyone thinks, which then puts you at risk as a partner in the deal. But like, they can make it look so shiny now, you know, and well, the thing is, is that the syndicators getting a fee when it closes, then they're getting all this free depreciation because they didn't put a dime into the property. They're reaping all these benefits. And if the game plan is to raise rents and sell it in five years, I mean, it's, you know, maybe the market goes down and back up before then, I don't know. It's going to be interesting to see how it all plays out. But I'm just sitting here, like you say, patient, because when, you know, I want people to know that when I say, okay, here's a deal that we can invest in people like, okay, Ricky's turned down a hundred deals so far. And this is one out of a hundred that he is finally found that he thinks this is something. Yeah. And I want people to have trust in, you know, how I evaluate these deals and what I'm actually willing to put my name on the line for that, you know, this is a deal we want to get into. So, and then, you know, do the best I can do to make that investment extremely successful and, you know, have people that want to reinvest or reinvest or reinvest and build that, build that following up. Yeah, I feel like, I feel like you've given away so much information for free over the years that you've built the trust dialogue where you could just put out and like exactly like you said, now at this point, when you say, I'm going to do a large scale syndication, there's so many people for years who have trusted you, they don't have to overthink it when you look back to when you started really going in on YouTube and social media, you know, on just real estate in general, what led you in the beginning to do kind of the opposite of what everyone else was doing and just like give away all of your coaching and ideas for free, because I've always valued that principle and I see it like year after year, you're still doing it and it helps so many people. What, why did you think that when other people were thinking, how can I monetize this? Well, I try the monetization route for a good six months and it was like beating my head against the wall, especially in the real estate agent world, you know, where you have, the thing is, is if you need help in real estate, chances are you're strapped for cash and you know, if you don't need help, then you got plenty of money. So, you know, maybe I should have geared, you know, a product around the people that had money, you know, that could help them, right, you know, but I didn't, I went after like newer type agents, agents that were struggling, trying to reduce the failure rate in the industry and stuff like that. But what's been interesting is, is the way that I looked at it was that if I go free, I'm going to open up the floodgates and I'm going to build this massive following, right? And, and what's going to end up happening is a lot of these people that are struggling now or that are new now, they'll turn into really high producing and successful agents over the next three to five to 10 years. You know, I'm six years in right now or getting close to six years in doing the coaching. I'm just now seeing signs of people like I have two people that I know of that are number ones in their MLS, tons of people that are top 10 and much more, many more on the way, you know, and like the new agents that are getting in right now that are getting into my program, you know, I'm not going to really see those guys, you know, shine for three to five years or eight to ten years. And so I'm looking so far ahead that some of these future mega influencers and mega producers and pillars of the industry are going to have been part of my program from the first day they got into the business. And so eventually I will have this really concentrated group of really, really high producing, high quality business people and it's already happening, you know, I've already got that now, but it's going to get better and better and better. So I kind of had to start from the bottom, but I had to kind of do it like that because I felt like I was just, I wasn't growing fast enough. And when I say grow, I mean, people who know who I am, they know what I'm doing. They know they understand the logic and, you know, honestly, I haven't hit a home run on anything monetarily speaking. I mean, well, for many people, I'm sure I've hit home runs right in their world. But in my world, you know, I haven't really hit that, that one out the park where boom. So that's why I'm still grinding so hard is to just continue to build the influence, you know, help as many people as I can and try to develop those relationships and collaborate into other businesses, you know? Yeah. Yeah. So I mean, when you look at it over the long haul, this is a question I've been wanting to ask you for a long time. How valuable do you think having a license is for, for not just for an investor, but investor who wants to do both because I've always thought like I don't understand why real estate agents don't invest, they have the access, they have the resources, and then you find probably, I don't know, 99% of agents probably have no, you know, investments. That's crazy to me. What do you think about that in terms of having your license? I mean, I feel like everybody, if your license should be investing. Yeah. Um, that's one thing that I'm trying to do this year is try to be a little louder with agents who need to invest. Um, you know, trying to take my following who is, you know, 99% real estate agents and say, Hey guys, you need to be investing, you know, it's the end game for real estate agents. Yeah. What can I do to help you, you know, um, create a game plan around that? So that's something that I'm doing. Um, you know, I'm going to try to create an investment group, um, you know, where, you know, we're collaborating on this kind of thing. But yeah, it's crazy. A lot of real estate agents don't buy real estate and I think what it is, is that they come from this, um, you know, working world, you know, and like being a real estate agent, it's another job and they are never really in the, this investing mindset. You know, I think more people are now than ever, but I think overall generally speaking, you know, that it's just another job. That's what it was for me. It was just another job. I was lucky enough to say, okay, how can I use my money to make more money? Yeah. But I didn't really even understand, you know, the real true benefits of real estate investing till really here recently. I mean, some properties, some duplexes and stuff that I bought back in 2011 and 12 that were really just crap properties. They're turned, they've turned into some of my most prized possessions. You know, yeah, I mean, they've went up so much in value. The rents went up so much. I bought them for so cheap. But you held them. I mean, like you said in the beginning, I mean, the short term versus long term is so important in all aspects of real estate. I think people are like scratching to get money or to get success and they just don't realize like it's not going to happen overnight. But you could have taken those and say somebody offered you a year later, you know, a $5,000 profit. A lot of people would just take that. But then you could lose $100,000 over the next five years by, you know, giving in and thinking that was going to be a score. Yeah, yeah, exactly. Exactly. I bought them to keep them, right? I bought them to keep them forever. I mean, I could have sold them at the peak for just God, awful number. I almost did sell a four plex because it's just been a pain managing it, you know, but, but, you know, I didn't. I was like, nah, and, you know, now rents are just so high. It's just making so much money. So, I didn't realize really if I would have known, I would own more property now if I knew back then what I know now, I would have like put everything into buying properties because, you know, I'd be so far ahead, but you don't think about it because like agents, like I'll talk to agents about investing and they're like, well, I'm going to make 200 bucks a month, you know, and I'm going to be managing it. I'm going to be doing this, I'm going to be doing that. I'm like, but dude, you're going to get all the appreciation. They forget about appreciation. Yeah, exactly. You're going to get your debt. The debt you take on is going to get paid off by the property over the $200. You're going to be able to do depreciation on the property and write, write, you know, write off, you know, you know, have write offs for your taxes. I mean, you got four ways to make money, depreciation, appreciation, cashflow and debt, you know, pay down, principal pay down. You know, it's not just $200. It's so much more. Um, you know, I don't know, man, appreciation. I, I saw a thing where, where I think it was NAR, maybe. They basically said the average sales price is going to go up 100,000 per decade. You know, so like, so like in 2020, um, it was 300,000, you know, 400,000 in 2020, 2030, 500,000 in 40, 600,000 in 2050. I mean, you know, that's pretty tough to, you know, say what, you know, what prices are going to be in 10, 20, 30 years. That's basically, um, impossible to do. But, um, you know, when you look at inflation and when you look at everything, all the other factors like real estate is going to increase in value and you really kind of want to own assets over, you know, owning cash, you know. Yeah. I mean, I think, uh, I grew up as a cash investor, the same as what you said, and then I still continue to mostly invest in cash when I can. Um, but I think people get lulled into, like you said, when, when you were buying early, it was just so easy to get basically what you think is free money at the time. But then you can mismanage that. And I feel like that's what I think of when I think of hard money. I know you don't have to use it, but a lot of investors out there who are starting and flipping have to use hard money and they think somehow this is, you know, easy, but I feel like you can get really dunked on hard money real quickly, especially with the market. I'm not a big fan of that, honestly. Yeah, same, you know, if you're like newer and you're trying to flip houses with hard money. I mean, so risky, like personally, like go do what you want to do. Listen to whatever guru you want to listen to, right? But just personally, I'm not a fan of that because, you know, it's just super risky. I mean, I don't know. The rates and points are so high and you're also have no experience in doing what you're doing. And I think people who are flipping, obviously you flipped a lot of houses, you know, like just something always goes wrong and their numbers are always wrong. So you're really like, you know, setting yourself up for just colossal failure. And I really like new flippers. I'm always worried about 24 7 because I just feel like it's the easiest way to lose all the money. And that's what I did. I lost everything. I mean, I had, I made a million dollars and lost every bit of it. So, so now I pay cash for all the flips. I have two other partners on that. And then everything that I buy that's like long term, I take on as much debt as I can, you know, 20% down. So I don't have the PMI and I put 20% down and run it out. And you know, the plan is for it to pay itself off in 30 years. And, you know, rents continue to go up, it appreciates, you know, nothing to worry about. Yeah, I feel like in the investing world, everybody's so obsessed with cash flow. And they just like discount appreciation where of course you make so much more money and appreciation over the lifetime, if you can just relax, but every it's just like cash flow, I guess is sexier to people to talk about just like they talk about how many doors they have. It doesn't make any sense. Nobody really cares. It's how much you're taking home and how much, you know, better a life you can have by by doing it all. Yeah. And what's dangerous is short term appreciation. If you're planning on five, what it's going to be worth in five years, that's a horrible game to play. Yeah. Or even, you know, next year or whatever, you know, it's good to say, OK, we feel pretty certain that this property is going to be worth more, any property is going to be worth more in 10 years in 20 years, you know, kind of look at it on that basis. Have you have you do you have any short term rentals because I know you're in a you're in a vacation type market. Is that something that you you're messing around with as well? I've owned a bunch of them, you know, I'll buy them for a couple of years, rent them out, sell them for big profits. I mean, I've done that. But I don't have any right to second, you know, I as the market that those were all short term investments like I've never wanted to own any of those long term. Yeah, they were all, you know, here's a good deal. You know, feel pretty good. This is a great rental at a good deal, you know, in a good building. Yeah, I can buy this and you know, see what happens appreciation wise over the next couple of years and sell it. Yeah. So we I rode the wave up, you know, and really sold at the peak really on a couple of them and did really well. One of them actually, we bought it for 270. We as me and a partner, we put 20% down. So it's like 30 Gs. Yeah, a piece, you know, then we sold it for four and a quarter, just a couple years later. And then we took that money, 1031 did into a commercial building for 450. We're renting it out for 4,000 a month. We put up another like 125 a piece, 125 a piece, yeah, right above the problem above what we had coming off the condo. So right now, so I was in it for 150,000 total on my side, cash. We refied out of that 450 property for 300 got our 150 back. So I got my 150,000. Yeah, I'm out. The note, you know, like we make about 2000 a month on top of the note and everything. So I'm making $1,000 a month, complete infinite return, right? Zero money, zero money invested at this point. And it's making 1,000 a month, you know, and so now we're going to enjoy depreciation, appreciation. Well, it's paying that that new debt off, you know, and we've got $1,000 cashflow on something that, yeah, I put 150,000 into it, but I got it back. Yeah, now you have it back. Yeah, you talked about partners again. I mean, I guess help for other, you know, investors and new investors and really experienced investors. What have you found like not the best way to find partners and then the best things to look for in partners because I think it's really important in deals because partnerships can go so haywire and investing. What have you found are the most important things for you when you link up with a partner and you know, like, this is going to be good. Well, partners I have that that are that, you know, we work together on these local properties. These are people like the like the one guy I did the condo deal with he went with the high school together, right? And then another the other partner we have on flipping, you know, he was a client of mine for like 10 years. Yeah. He, you know, bought and sold stuff. You know, we were like, you know, he was like family, you know, we're eating dinner together and everything else. So and it's not like I went out and pursued these partners like, Hey, let's be a partner on this. It's just something that just kind of happened, right? So I didn't go out and actively looking for partners. It just happened to be like, Hey, there's a deal. Do y'all want to throw in on this? The next thing you know, we're flipping houses every month. Yeah. So I just comes from trust of knowing these these guys for so long and seeing them in business and know what their reputations are and stuff of that nature. Now when you get into like investing in these big deals, you've got the general partners and the limited partners, you know, the limited partners basically the ones that put the money up. Yeah, they're basically almost silent partners kind of deal where the general partners, the ones kind of running the deal, they find the deals, they manage the deals and everything else. So the limited partners don't really have much to worry about. They just have to really trust the general partners, you know, they're going to go out and do their job and increase the the rents and the value and maintain the properties and all that good stuff on the general partner side. Again, you know, it just has to be people that you really, you know, they're like fam. I mean, it's not going to be in business family, I guess it's probably not good. That can go higher. Yeah, but I don't know. The guys I work with on the GP side are, you know, guys I've been in business with and worked with for a really long time on other stuff. And I think that's pretty key. It's hard to take someone you just don't know off the streets and just be partners with them. Yeah, that's tough, you know, I agree. I feel like too many people try to do that in flipping, whereas one's the money and one's the work and that just never works out because it's not and it's not really an even trade like that. Like if I if I have to partner, I prefer everything to be 50 50 with the partners, like if it's just because then you just know you're in it for the same thing, you got to make those decisions together and figure it out. But like you said, it does get a little bit confusing with the GP LP situation and what you want. But like, you know, if the GPs are great, you can just coast along and take that return and say you're investing in 100 doors, I guess. The guys that flip houses with one of them does all the work, right? But we all put up a third of the money when we buy the property. Yeah. And then the guy that does the work, he bills us. Yeah, that's perfect. He doesn't charge us near what a contractor would bill us for. Yeah. You know, we go thirds on, you know, he and he even pay he even pays a third of his, you know, like, yeah, yeah, like, like he bills us and everything split three ways on everything, you know. Yeah. So I want to get your take on this before we wrap up like you, you know, you're so well known and on YouTube and on Instagram. And I've heard you talk about this before. And we said we actually talked about it just a little bit for a second before. What do you think on the investing side of all these what I call fake gurus, there's a lot of great people in the investing space. So I feel like give a lot of good advice. But there's just a whole ton of fake stuff out there. And that's what I think makes it hard for real estate investors trying to figure out who's selling a class or who's selling like a future of learning really how to invest. What have you seen out there? And what do you think people should look out for? Well, I mean, it is a while it's the Wild, Wild West out there. Because you can start a channel and you can go out there and basically say anything you want to say, there's no, there's nobody, you know, watching this stuff and shut you down and say, oh, that's not true. And you know, a lot of the stuff is based on opinions to, you know, what strategies you use and how you do it and stuff like that. So it is really tough. It's just like anything else though, right, especially in today's world with social media, there's so many people that just think they're the geniuses of everything. Right. So you have to take everything kind of with a grain of salt and look for the people that, you know, that you have, you know, feel like are super genuine and that you really connect with to have the results to speak, you know, it's hard, honestly. Yeah, it's messy out there. I feel like I mean, you're a great example of someone who has, you know, again, given it away. And then like now, of course, you have coaching programs, but like I don't feel like you're not the type of person who's trying to like push everyone into a funnel. Like you're like, Hey, this is available for you if you want to do this. But also you just keep pounding out the content every day. And I think that's where people might be able to see, you know, if you click on one thing, and then you get onto like an email list and you get 50 emails in a day, something's wrong. You're like the value proposition is off there. Yeah, yeah, everybody's trying to push their thing and get their products sold and stuff like that. And I'm just trying to build community. I'm just trying to build a network of people who, you know, want to collaborate and want to learn from each other and kind of adapt as the world changes with technology and communication and stuff like that. I'm just looking five to 10 years out on everything. Yeah, you know, yeah, it's important. I think one thing I found like an investing specifically because we do like in person meetups and the camaraderie of investors is so important because like you can you can watch people on YouTube, but that doesn't mean you can go out and do it. Like you have to like collaborate. Like you said with people who are doing it. I want to learn from people who did 20 more deals than me and then help people who are just trying to get started. But like investing is people are so excited to try to do it that you really have to get in person and meet people. Obviously it helped to have zoom available after the pandemic. But yeah, I like what you said. I mean the collaboration of your group at which is agents who are going to all learn to invest is so important on the investing side as well. Yeah, you know, experience, right? Experience is really where you really where you learn. I mean, you can collaborate and you can go to seminars and watch YouTube and stuff like that. But until you actually step into the arena and do some deals and it and really it isn't till you, you know, do a few bad deals. Yeah, for sure. You know, until you really lose on some deals, you really just floating. You know, you can't really tell anybody. I heard so many. It was crazy because like I used to hear agents talking to their clients and they would be advising them on investing and stuff like that. And they'd be saying the wildest thing I would be eavesdropping on the on the conversations. And I just remember here in agents say the wildest things. And I'm in the back of my head saying thinking, man, this agent has never lost on a deal. You know, like they've never, you know, lost money or lost their lost their lost their ass. They know, like every, you know, went bankrupt and stuff like that. And so it's kind of hard for them to really say what to do when they don't really know what not to do. And they're out here telling people, you know, what to do when it could be the exact thing. And the person listening is like, oh, yeah, yeah, tell me agent, tell me, yeah, yeah, this is so good, you know, let me do this, let me do this. And I'm like, man, you know, be a little more cautious and be a little more patient. Yeah, I mean, one last thing on this part, I feel like we're talking before about agents who should invest. But like the I think one of the hardest things is that I found over the years and the reason why I started my team and help them all become investor friendly as well as because most real estate agents don't know anything about investing. So when you have a client who wants to invest like you, I can overhear the things I'm like, are you serious what they're what they're telling them? Like they don't understand anything about when to use cap rate, you know, what's good, what the cash flow is they don't take into account property management, you know, as a percentage, they don't know how to do CapEx, they don't know how to do repair costs. They have no idea about anything, but they're trying to give advice. And there's only a really small subset of real estate agents who can also give that advice as investor, do you agree with that? Yeah, and they're called commercial agents. They're commercial agents that have been in the game for a good, you know, two years plus. And that's really still pretty new. But but yeah, it is man, because well, that's a completely different ball game, you know, getting into the investment side. I was lucky enough to be in the condo game where people bought them because they want to take their family somewhere really nice in the summer, but they're also buying it as an investment. And so I was really the type of properties I primarily sold were really in the gray area between residential and commercial, right? And I got to really kind of taste both sides of the emotional attachment to a property and buying it because you love the color of the floors. Yeah. And also, you know, the cold hard, you know, investor side of it as well. You know, it was really cool, but I got to, you know, spend most of my career dealing with that and trying to make the wife happy on the colors and the husband happy on the numbers, you know. Yeah. And so I got a nice taste of investment, even though I was in the in the residential world, but people that are just doing primary homes and, you know, not second homes like I was doing. I mean, this investment stuff is like a whole different language. Yeah, I agree. I agree. And that's why I think it's so important for investors to do that research and find agents who are also investing and understand what their portfolio looks like, how many deals they've done, because that's what's going to help them grow instead of, you know, most agents are just looking for a commission. So they want to just get one sale, but that's not what investors want. They're trying to build a whole portfolio. So over over your 20 years, Ricky, if you could look back and give like I created this podcast, you know, to focus on the mindful approach to real estate investing, what advice would you give like investors right now in this market that you think would help them have a more mindful approach to what's coming and what's out there? Well, nobody really knows what's coming, you know, a lot of people want to think they know what's coming. But, you know, right now, you know, there weren't too many people that were calling for this multiple offer situation that we're having now. You know, I was, I mean, I've been saying it for months that, you know, inventory, dropping like a rock, interest rates dropping like a rock and, you know, demand still building. Yeah. This wasn't hard for me to see what was going to happen. But honestly, it's like this isn't the best of, you know, situations because if we start seeing multiple offers in the housing market really start heating back up big time. Well, we already saw lumber lumber prices jump up. Right. That's just the beginning. That's just the beginning signals of inflation. I mean, that's in essence the definition of inflation. Yeah. If inflation goes back up, if we see that start to rebound, then we're going to see 30 year fixed rebound as well. And, you know, this time they may not play with it. They may go way up because they say, OK, well, what we did last time didn't work. Let's really pour it on and see what happens, you know, and that could be that could really put us into a serious shift. Yeah. So nobody knows what I mean, I could see what's happening now happening. But but what's going to happen past, you know, this little period? I mean, who who in the world knows? I think we're going to have a really incredibly strong spring. I think we'll see a huge rush of buyers, a lot of the man, you know, no inventory. It's going to be crazy. But then what happens after that? And so if you're an investor, I think flipping houses is probably done for right this second. You know, I don't think anybody should buy a house thinking I'm going to flip this. So buy in July. Yeah. Well, yeah. I mean, even if you buy it at the, you know, depending on your market, you're down anywhere from, you know, 10 to 30 percent. Well, I don't know. All the local markets are different. But, you know, even if you bought it at that 10 percent, you know, rate where it was down is down 10 percent. Even if you bought it at that new number, we still don't know exactly where it's just there's too much uncertainty right now in the market for that short term, you know, investment, right? Now, where we do feel very certain is the long term that I feel even if prices come down some, you know, from where it is now or how long this thing takes, I still feel like in 10 years that you're going to see some really great appreciation on your on your properties that you own. So yeah, I think walking into situations, buying them on the current cash flow and and looking at it from a 10, 20 year standpoint is really the mindset you should be in right this second. You know, I mean, if you can find something where you can buy for 50 cents on the dollar of today's market value, sure. Right. But where are you going to find that? Yeah. And what's it hiding? What's it hiding if it's at that value? Yeah. Yeah. That makes I think now you just got to be in a cash flow, a long term perspective when you, you know, on your investing. Yeah, I agree. Our twenty twenty three investing term was asset hunting this year because I think people are a little bit over focused on like just numbers and like just what you're saying, if you can focus on the asset and you know, like, OK, here's the cash flow. It's whatever it is, 200 bucks a month, but it has the potential to go so well because, you know, the area, you know, the dynamics of that, that's an asset. And I think people forget to focus on the asset and real estate and that asset is literally everything because you could even withstand like a little bit of negative cash flow if you're smart and you know what's coming. You might be wrong, but if you're right, you're going to really win big in the long run. Yeah. I mean, like I say, if when you buy, if you're looking at very, very worst case scenario that you're still a winner, right? I mean, one thing I feel pretty certain on is that rents have escalated really high. You know, a lot of, I mean, I hear, I see a lot of data that rents going to continue to go up, but only at one or two percent a year or something like that. I mean, wow, if rents maintain the level that they are. They're insane now. Yeah, that is crazy if they don't go down. Yeah. That just tells you how strong that market is. But, you know, I would say, OK, like, all right, prices go down, you know, you know, 30 to 40 percent and along with rents. OK, you buy a property and the value of it goes down 30 percent and the rents go down 30 percent. OK, are you still in good shape if that were to happen? You know, that's what I want to look at. Yeah. You know, am I still in good shape? What's my game plan at that point? Values go down 30 percent along with rents. What then am I am I still in good shape? And what's the chances of that happening? You know, rents going down 30 percent, that's probably a very long shot. Yeah. Now, if you're a multifamily and you buy today, it's not that far off that it doesn't go down 30 percent. If you're buying a big commercial building that could and then that could bring you back to, OK, why don't we buy four plexus and, you know, four unit and lower property so that we can get a Fannie Mae 30 year fixed and we can write it out for 30 years if we need to. Yeah. Right. So there's a lot of different things to think about. Awesome, man. I really appreciate it. Let me give all of these people if they don't know you, let's make sure they know where to find you. So on Instagram, it's Ricky Careuth that's C R R U T H and YouTube is the same. Right. Let me just. Yeah, C A R R U T H. Yeah. And then tell us a little bit about zero to diamond. I know that's an agent based coaching platform of yours. But what's that all about and how long have you been that's you've been doing that for six years. Yeah. Yeah. So started doing that six years ago. It's literally a course. I've got a bunch of courses like six or seven courses in their scripts, videos of me making calls, 60 day challenge, marketing, social media, everything, anything I could think of. And so I updated every year around the end of the year and just update it, you know, for whatever I learned throughout the year that I can add to it. But it's also a platform, social media platform for to connect and, you know, create your profile and, you know, DM people, create groups, post on your wall, all that good stuff. But no, there's I think there's like 20,000 members there now. We switch over a year. We switched it over a year ago. We have 50,000 members on the old platform and we we we switched it to a social media platform where everybody could connect before it was just a website you go to take the course. Yeah. Now it's a website you can go to connect with all the other agents. And so, yeah, I mean, it's it's just just continuing to build that community. But like I say, man, there's been so many agents who, you know, are crushing it, you know, using the philosophies and strategies there. So I answer all my Instagram messages every day. So that's really tough to do. But I spend hours. It's really worth it's worth it, though, even at your level. Don't you think it's worth it? And I mean, every all of us know when it's not this person in the DMS, it becomes like, why do I want to talk to an assistant there? Yeah, I mean, so far it has been, you know, because people, you know, feel like, you know, wow, you know, I'm really connecting with the person. Yeah. You know, there's a lot of debate there. You know, there's a lot of debate there about time spent ROI on time. Yeah. And you know, making myself so available, you know, to the public. But the thing is for me is I'm a grinder and, you know, come from such humble backgrounds that the all these people are like they need so much stuff. And I feel like I'm kind of letting people down if I don't listen to those questions and problems and kind of help them through those situations. So it's just something I do. I can't say I'm going to do it forever. Yeah. But it's something I've maintained up to this point. So we'll see how that goes. Yeah. All right, man. Well, it's been an absolute pleasure. Hope everyone will hop over and follow you. They probably already are. But it's been great talking to you and great to finally meet you. It's exciting to talk investing with you. So I really appreciate your time. Yeah, man. Enjoy it. We'll do it again soon. All right, man. Thanks. This was episode 30 with my guest, Ricky Karuth. We'll see you next week. Thank you so much for watching this podcast. I hope you got tons of value out of it. I'm going to put the next episode right here so you can continue watching and continue crushing. Keep selling and keep building. And we'll see you guys on the next video, which is right here.