I Started Investing with Just $7,500. Now I Own Millions in Rentals

Dave:You know what it’s like. You work all year long for your company. Then your boss sits you down, tells you you’ve done a great job. So you’re expecting a promotion, a raise, maybe even a company car. But then they tell you excellent work. We’re happy to be increasing your pay by 2%. 2%, that’s it. There must be a better way to make money than this. And that’s exactly what today’s guest Remington Lyman thought. Just a few years into his working career, he realized his hard work wasn’t paying off proportionally. What does reward hard work? Rental property investing. So he started buying properties with a partner using any money they could get together. Then a couple years later, when his job laid him off, he was already well on his way to financial freedom. Now he’s got single family homes, multifamily properties, commercial deals, and more that give him the income a job never could.He started with just $7,500, but now he’s got millions in real estate all because he placed a bet on himself.What’s up everyone? Welcome to the BiggerPockets Podcast. I’m Dave Meyer. Today on the show, we have a super fun investor story with Remington Lyman. I really enjoyed this conversation because Remington’s story is so familiar. He was not feeling like the reward he was getting from his full-time job was proportionate to the effort that he was putting in and the value that he was creating for his company. So he decided to place a bet on himself and find a way where he could be fully rewarded for the risks he was taking and for the effort he was putting in. And he picked rental property investing and has approached it in a way that I think all of you are going to learn a lot from. Let’s bring on Remington. Remington, welcome to the show. Thanks for being here.

Remington:David, thank you for having me.

Dave:Let’s talk first a little bit about your background. Who are you and what was your history? What were you up to leading up to your investing career?

Remington:Yeah, so I’m originally from Connecticut. I got recruited to the Ohio State University for the rifle team.

Dave:Rifle team?

Remington:Rifle, shooting. Yeah.

Dave:I did not even know that was a D1 sport. That’s very cool.

Remington:Yep. Yep. Punching holes and papers. It was good. I trained really hard and got a scholarship to college and came to university, majored in finance, my own econ. When I graduated, I got your typical finance bro job at JP Morgan. I was an analyst and was always very entrepreneurial and the W2 just wasn’t doing it for me and wasn’t accomplishing my goals. So I quickly realized I needed to start my own business. And through that process, my roommate and my lease was ending and we’re like, “Hey, instead of paying a landlord monthly payments and rent, why don’t we go out and buy a property with the intention to later on turning it into a rental property?” So that’s what we did. We went out and we actually did a house hack. That was my first deal in real estate.

Dave:It’s a classic story. Love it. It’s very similar, honestly, how I did. I did my first deal with one of my partners was my roommate at the time as well. We got tired of paying rent. We were like, “We got to do something better here.” Where were you living at the time when you did this?

Remington:I was living in Columbus, Ohio. So my roommate and I, we found the dumpiest apartment you could find, had a bunch of roaches and we were splitting $600, so each paying 300 to save up money. And that allowed us to put the down payment on our first duplex. And we did all the work ourselves. We did the renovation to the other side, we did the leasing, we mowed the grass, did the management and that allowed us to save a bunch of money. And three months after our first deal, we went out and purchased a four unit and did the same thing.

Dave:Wow, that’s awesome. So what were you buying these things for?

Remington:Our first duplex was actually pretty expensive for the time. It was about $330,000 and this was back in 2017. But after we leased up the other side, we found another roommate for our side on Craigslist and we moved in his girlfriend and we charged her like $300 a month. And so by the time all that was said and done, we were making about 50 bucks to the good every month while living pretty much rent free.

Dave:Before we talk more about the deals that you’ve done and your real estate and what you’re doing now, I’m just curious, you said you work in sort of finance pro job working for JP Morgan. I assume it was probably pretty high paying, good job. What was it about the corporate life that wasn’t resonating with you?

Remington:Yeah, so growing up, I was always taught if I went out and trained harder, if I practiced harder, performed better than my competition, I would be rewarded. And when I got the W2 job, I worked really hard, same thing the first couple years and they gave me a 2% raise at the end of the year. I’m like, hold up, I know basic finance, that’s inflation. So I just got very discouraged and wanted something more from life.

Dave:Yeah, that makes a lot of sense. But you stuck with it for a while, right? While you were building your investing career, you stayed doing corporate or did you quit immediately?

Remington:Yeah. So I worked for about four years at JP Morgan and I got up to 10 rental properties. And then in 2019, I actually got laid off from JP Morgan and that was a real pivot in my real estate investing career.

Dave:Were you able to cover your lifestyle at that point?

Remington:Yeah, I was able to cover my lifestyle, but I was 22, 23 at the time and I just wanted more. I knew I wanted a big family. I liked to travel. So I just kept buying. When I got laid off, I got my real estate sales license, commission-based job, worked really hard at that, closed a bunch of deals, working a lot with investors, which allowed me to make a bunch of money and just continue to invest over the years.

Dave:It’s a hard change, I would imagine going from that steady paycheck to being entrepreneurial. It’s exciting. It’s great and it usually works out in the long run, but I’m sure that was an adjustment for you just mentally going from having real estate be sort of like a side hustle to it becoming your main gig. What was that transition like?

Remington:Yeah, it was really scary. And to be perfectly honest, I don’t think if I got laid off, I ever would’ve taken the jump. But now looking back, I mean, I was making $60,000 a year at JP Morgan and now I make way more money than that. Sometimes I make that in a single commission check. I’m very fortunate. I’m up to a hundred units now, residential and I’ve got four commercial deals working on purchasing more. I own my real estate brokerage, which has over 45 licensed real estate agents that I own 50% of and then the managing broker. And I just enjoy going to work every day, which JPMorgan, it’s a great company. I still bank there, but I just didn’t have the oomph to go into work every day like I do now.

Dave:Good for you, man. It’s oftentimes those unfortunate circumstances that kind of light a fire, just necessity. You have to figure something out and entrepreneurship is scary. And so sometimes it takes a little kick to do it. But fortunately you sort of had built up some of your business. You weren’t just jumping into something brand new, which is why I think for a lot of investors, people listening to this, starting real estate as a side hustle is such a beneficial thing because it is manageable while you’re working a full-time job. And then whether it’s through necessity or someone else sort of deciding for you like it was with Remington or your own choice, you’ve sort of built some of the muscles at least, whereas you can sort of scale up at your own time. If it’s okay with you, can we just talk about how you went from that first house hack to this really impressive portfolio in just 10 years and maybe we can unlock some tips and tricks for the audience here.So you did your first house hack with a roommate, you renovated yourself. So how’d you go out and find that deal and did you have experience with renovations at that point or how did you know how much you could take on?

Remington:No, I really had no clue what I was doing. I started listening to BiggerPockets after I got my first deal on my way to work and that really helped a lot. It helped me make less mistakes, helped me realize why I was making the mistakes I was making, but I learned everything with the renovation with electrical, plumbing, flooring, painting, drywall, just from YouTube Academy. And whenever I had a question, I would have mentors that I would reach out to and they would guide me. But if you really accept that you’re going to make mistakes in the beginning and you’re willing to put sweat equity in and you stick with it over the long run and I think that’s where a lot of investors lose their way is the first couple of deals don’t always work out the way that you think they are and those are going to be the toughest ones, but you’re going to learn a lot and then now I make less mistakes.I’m able to do more deals, bigger deals, have access to different types of capital and you just got to really get started.

Dave:So you did that first deal. How long after you bought that first deal was the second fourplex?

Remington:Well, strategy we would do is I had a business partner at the time, which I eventually bought out, but I would do a house hack and then he would do a house hack. So we wouldn’t have to wait six months to a year before doing our next one. And we would just take turns getting the loan. So we got three properties, a total of 10 units in probably a year and a half, which is pretty quick.

Dave:That’s a super good idea. So rather than remaining as roommates, you just like, we’re each going to go acquire our own unit and we’ll be business partners on all of them for some period of time.

Remington:Yeah.

Dave:I like that idea. That’s a pretty good approach. So sounds like you got off to a really good start here, mostly focusing on house hacking, but I want to hear how you really started to scale because your portfolio sounds really impressive, but got to take a quick break. We’ll be right back Welcome back to the BiggerPockets Podcast. I’m here with investor Remington Lyman and we’re talking about how he started his investing career in Columbus, Ohio first by house hacking, working with a partner. After those first couple of small multifamily, I think you were up to 10, right? You had a duplex, two fourplexes. Where’d you go from there?

Remington:Yeah, and this is where my portfolio really started to scale and it was using the Burr method. So I went out and I identified, I had been cold calling a lot, property owners, distress assets. And I found this four unit in this area that was really up and coming called Franklinton. It was in a really bad shape. The owner wanted $80,000. I was going to have to evict everyone, do a complete renovation, probably $150,000 of work. And so what I did was I had about $75,000 to my name at the time because I had just gotten laid off, but I had saved a bunch of money. I went to my mom and I borrowed about $10,000 and I purchased the four unit and then I went with a partner who was a mentor. I said, “Hey, I got this great four unit that I own cash.I bought it for 80,000, but I got to put about 150 into it and I think it’s going to be worth about 450,000 when I’m done with it. ” So a home run deal.

Dave:Like those numbers.

Remington:And he’s like, “Hey, I’ll do that 50% partner. I’ll give you all the cash to renovate. We’ll quickly renovate it and we’ll refinance it. ” And that’s exactly what we did. So we put about $230,000 into it. We appraised it at about 400, 450,000 and we pulled all of our money out and then some. And that was a good example of delayed financing because we purchased it with cash, did the renovation, did the BERM method and refinanced it. And I went on through my middle career doing that to a bunch of small multifamily properties and within six months, because you have about a six month seasoning period where a bank will refinance it for more than the purchase price and renovation, just did that with cash, waited six months, pulled all my money out and then some, and then I had extra money to do future deals.

Dave:Dude, wow, that’s an unbelievable deal. Let’s dig into this one a little bit. There’s a couple things I think our audience should hear about. So first and foremost, tell us about this mentor.

Remington:Yeah. So I actually met my mentor while I was working at JP Morgan. I would go into work early so I could leave a little bit early, beat the rush hour traffic, come back home and I would pull a list off the county auditor site of all the property owners, all the two to four unit owners in my zip code that I wanted to target. And our county typically had a number associated with the rental contact registry. And so I would call them up and I would be like, “Hey, I see that you’ve owned this home for 20 years. Are you interested in selling?” And most would say no, but some would have a good conversation and one person that I met was like, “Hey, I’m really old. I don’t want to sell anything, but I’ve got a really good agent that found me a bunch of deals, you should meet with him.” So he gave me his phone number, I called him up and I would have a beer with him after work once a month and that’s how I met my first mentor.

Dave:Awesome. That’s so cool. I mean, it’s just hustle, right? You just build personal relationships based on your own hustle and effort because a lot of people want to find these mentors. There’s no prescribed way to do it. You kind of just have to put yourself out there and something will usually work like the mentors I’ve had in my career, not even in real estate necessarily, I can’t tell you how I found them. It’s just like going out and doing your work every single day and you can find these people who if you build authentic, genuine relationships with can help you with your investing career. So tell me, Remington, how’d you structure this deal? Because I think this is a common thing that people face. You got a deal on the line, good for you. You don’t have enough capital to take it down. So how did you have the conversation with your mentor and how did you legally structure it so you both had upside, risks were limited and so on.

Remington:Yeah. So we drafted up an operating agreement, he put the money in for the renovation. I had the basis of the property that I had purchased cash. I had a little bit of extra that I needed to put into the partnership to cover to match his money that he was bringing. And once we finished the renovation and refinanced it, we just split the proceeds fifty fifty. And then later on we actually ended up selling that property. We 1031ed it from a four unit into a 24 unit apartment building that we still own today.

Dave:Oh, so not only were you able to pull cash out on top of your investment, but you had so much equity built in that deal, you could roll it into a building six times larger. That’s incredible. Nice. And you found that deal just cold calling?

Remington:Yeah, I found both deals actually cold calling, the four unit and then the 24 unit that I 1031 into.

Dave:Damn, that’s awesome. Good for you. And were you still doing your own renovations at this time when you were doing these BERS?

Remington:So I wasn’t actually swinging the hammer at that point. I was just writing checks. I was managing pretty cheap contractors. Cheap contractors are good because you save a lot of money, but there’s a lot of project management that you need to do. You need to make sure that they’re showing up to work. You need to go to Lowe’s and buy the materials because these guys don’t have money to buy it themselves and you make sure that they’re doing their work correctly. And I wouldn’t suggest that for a beginner, but I had enough experience to know what was supposed to be done correctly and how much it should cost.

Dave:How do you like managing renovations?

Remington:It’s probably one of my least favorite things. I try to partner with people that are really good at it. Me too. And I will bring the experience with getting the loan. I will bring the experience of finding the deal and how to structure it, but I really don’t like managing the contractors. So I try to find people that will do that part of the job.

Dave:So that’s awesome. It sounds like an incredible home run deal. I imagine after that you kind of just Bird for a while because if you could do that kind of deal, why wouldn’t you do that all day?

Remington:Yeah, Bird for a while at the time interest rates were like three, 4%. So I would do the Burr and then refinance into permanent 30-year fixed rate debt that was super cheap. So a lot of times I would be cashflowing and it was a really good strategy to use and it still is today.

Dave:Yeah. And at the same time, right, Columbus kind of exploded.

Remington:Yep. There’s a lot of out – of-state investors. There’s also a lot of local investors as well. And what you tend to see is the local investors will tend to buy AB class neighborhood properties and then the out – of-state investors will tend to buy the C-class properties because they want cashflow more. So it’s cheaper properties. But yeah, a lot of growth has happened in Central Ohio with Intel, making the chips and oral, making the drones. You got Honda building the electric battery for the cars. There’s just a lot of growth in Central Ohio because it’s been so cheap for these manufacturers to build out their headquarters. And then also there’s a lot of higher education colleges to then recruit the talent to manage that.

Dave:So tell us a little bit just about these deals.You were doing these burs. Were you cold calling for all of them or what was your deal flow like?

Remington:No, so when I first started, and I still do today, I work with realtors. So they would find a property, whether it was on market or maybe a pocket listing that they thought would be a good deal for me. And I’ll always pay a good realtor, even though I’m a realtor myself. I would say about half the deals that I’ve purchased were through realtors. The other half have been off market opportunities, whether it’s working with wholesalers that are cold calling, whether it’s myself that’s cold calling. I also employ virtual assistants in the Philippines that will cold call for me as well. So you got to take every potential lead flow you can and analyze as many deals as possible.

Dave:Yeah. It’s hard right now to find good deals. I mean, they’re definitely out there, but it takes a little bit of legwork. Remington, if you had to give some advice to our audience about if they could just focus on one area, like if there’s one thing they could do to improve their deal flow, sounds like you’re getting amazing deals, where would you spend your time just starting out?

Remington:Yeah, I would talk to as many people as possible, get out there and network. Some of the best deals that I’ve found were just from talking to property owners to other realtors being like, “Hey, I’ve got this need for this asset. Do you have anything possible?” I own a small business and we wanted to really buy an office space that could support a bunch of agents. And I was networking with this commercial broker and I’m like, “Hey, we need a place that’s downtown that has good parking and that’s cheap and I want to do the renovations. So something that needs a lot of work, do you have anything?” And sure enough, the next day he called me and boom, we found our office building that I renovated. So get out there to your local meetups, BiggerPockets. There’s a lot of really good meetups and events that you can leverage to build out your network.

Dave:Totally agree. I think the best deals I’ve ever gotten the people I call when I have a problem or an opportunity or people I’ve just gotten to know over doing this for 16 years and it takes time, but there are ways you can accelerate your network, like going to local meetups like Remington said, you can and should come to BPCon. That’s an incredible place to meet really high intent people who want to be doing deals together. Tickets are still on sale. You can go to biggerpockets.com and check those out. But whatever way you do it, figure out a way to build your network. You don’t have to be the most outgoing person in the world. You just have to find ways to build a couple meaningful relationships and it really can be the difference between sitting on the sideline scrolling Zillow and just saying like, “Oh, this all sucks.” Or finding and seeing good quality deal flow over the course of your investing career really makes a huge difference.So it sounds like things went great through the pandemic, doing a lot of burs, but I assume you’ve had to shift your strategy like a lot of us since rates went up. Let’s talk about that when we get back from this quick break, stick with us.Welcome back to the BiggerPockets Podcast. I’m here with investor Remington Lyman, who’s built an incredible portfolio in Columbus, Ohio with a lot of hustle, building a great network, being a good deal finder, raising capital. You’ve done a little bit of it all. Where we left off in your larger story, Remington, was at the end of COVID. So you were doing Burrs. What has happened to your business, your portfolio, your strategy since rates started going up in 2022?

Remington:Yeah, so rates started going up and also I was just at a different point in my life. My wife and I went out and bought a nice house that we’re living in. So the house hack was out the window. Rates were coming up and really I was at about 80 rental units at the time where that’s a lot to manage and I was managing everything myself. So I needed to find a way where I could really scale up but also make it easier. So I started targeting commercial deals and I actually went out and purchased a warehouse with my business partner.Interesting. And it was a 24,000 square foot warehouse. We picked it up as soon as it hit the market. It was listed at about 600,000. We bought it, we put about half a million into it and then we went out and we found a 10-year triple net commercial lease and it’s a great deal now. We’re cash flowing about a few thousand dollars a month and it’s in an opportunity zone. So after the end of the 10 years, we can sell it and not pay capital gains. Oh, that’s a good one. I think half the battle and the sexy part of real estate investing is finding the deal and making cashflow, but where the other half and where the real generational wealth comes in is it’s all a taxplay. So how can I generate wealth but then preserve it through these different tax opportunities?

Dave:Let’s talk about this more because this is not the kind of deal that we hear about that often on the show. So first and foremost, can you just explain what a triple net lease is to everyone?

Remington:Yep. So a triple net lease, so when it comes to residential investing, you’re typically paying the taxes, you’re maybe paying the lawnmower or any repairs that you need to do, maybe you need to replace a roof, that’s coming out of your pocket as the owner. With triple net leases on commercial buildings, all of that is getting passed on through the tenant. So all of the repairs, all of the property taxes, every single bill that you would typically have to pay for as the owner is getting passed on to the tenant. So it makes it very simple. You can keep your property in really good condition without coming out of pocket and it’s really easy to underwrite.

Dave:Yeah. And it’s predictable. So unlike residential where hopefully you’re putting money aside for repairs and capital expenditures and everything, you don’t know when it’s going to hit and cash flow management is a little bit harder, but triple net leasing is super appealing because it should be a pretty similar return every single month. You shouldn’t have a lot of surprises, but you’re basically betting on the business. A lot of it is betting on the company that is going to be occupying the space because as long as they’re doing well and paying their loans, you’re doing well. If they can’t pay rent, there are obviously challenges, but if you find good operators, reliable operators, it’s an incredible way to make money. So what was the nature of the business that you brought into this warehouse space?

Remington:Yeah, so it’s an art studio. They are actually funded by a pretty big donor who’s a big real estate investor, family money, and it’s a not – for-profit. And then the not – for-profit will also sublease art studios within the larger complex. So it’s a pretty good business model. They’re fully leased up. They were fully leased up in a month. Central Ohio Columbus is really trying to become a art scene. So they’re really pushing these small art studios and it’s a really great program. It was in a not so great neighborhood and the building was not being used for about 30 years, which made it really interesting when you’re trying to renovate a building that hasn’t been used for 30 years, but the neighborhood is a lot better for it. There was a lot of support with local politics for the project to come about and it’s been really good for the community.

Dave:That’s super cool. I love that kind of mutually beneficial real estate. You’re doing something good for the community, doing something good for these artists, doing something good for your bottom line.That’s the kind of stuff we love to see here where everyone can benefit from it. Tell me about the opportunity zone side of this. Just for everyone to know, opportunity zones are a tax opportunity. I think it started in 2017 in the first round of Trump tax cuts, but basically it says if you invest in certain areas of the country that are designated, there are tax benefits for you and there’s different tiers of rules, but if you invest your money for a certain amount of time, you can unlock different levels of tax saving. I do think what you’re talking about, Remington, is the highest level. If you invest in something and keep your money in one of these opportunity zones for 10 years, the gains, the capital gains tax that you would normally pay are forgiven, right?Isn’t it? Is that the case?

Remington:Correct. And let me disclose, my wife’s an attorney, so she’d yell at me. “I’m not a CPA. I’m not an attorney. This isn’t tax or law advice, but yeah, that’s essentially one of the tax opportunity zone advantages. There’s other ones as well on the state level. They’ll actually give you a state level tax credit, 10% of the purchase price and the renovation costs.

Dave:Like

Remington:A tax credit. As a credit. And you can actually sell those. On the federal level, if you’re big enough, which we’re not, you can actually get even more from the federal level. So there’s a lot to really go after and that’s where it’s really important that you have a good attorney, a good CPA, and you really network and talk to people because when we first started this, we didn’t know about that and we left hundreds of thousands of dollars on the table because we weren’t taking advantage of every single opportunity. So get out there and ask questions to people that are smarter than you and unlock all of these advantages you can.

Dave:Yeah. So this deal, basically you bought something you renovated, which sounds tricky, but now you have a triple net lease and after 10 years, if you go and sell it, you won’t pay any tax on your gains. It’s another home run.

Remington:Yep, other home run.

Dave:Is that kind of a model you’ve been trying to replicate since COVID?

Remington:I’ve been trying to do that model. The other really big strategy that I’ve been doing recently are medium term rentals. So five years ago, short term rentals were really popular, but there is a lot of regulation that got passed with it. There’s a lot of turnover, a lot of maintenance, really sweet spot that I’ve been turning some of my units, residential units into have been medium term rentals. And I’ll get traveling nurses, I’ll get contractors, students that will lease out my units for a month to even a year at a time and they’ll pay me probably about 50% to 100% more than I would normally get with long-term rentals. And there’s not a lot of management when it comes versus short-term with medium-term. So that’s another strategy that’s been really cash flowing things pretty well in this higher interest rate, higher price market.

Dave:Columbus seems like a really good market for medium-term rentals. Just like so the state government’s there. You have giant university hospitals. Yeah, it makes a lot of sense. Are you managing those yourself?

Remington:Yeah. So I actually have a property manager that manages about 10 of those units. I self-manage one that’s near my house, but for most of them, I have a property manager that manages them, but they’re really great. They only take, I believe it’s like 15%, which is pretty cheap, medium-term rental and they do a great job. Oh,

Dave:That’s great. So what are your goals now? I mean, you’ve accomplished a lot in 10 years, Remington. Congratulations. Thank

Remington:You.

Dave:It sounds fun, exciting. You’re doing a little bit of everything. What’s the goal you’re trying to work towards?

Remington:Yeah, I mean, I just had my first kid, she’s six months old now. Oh, congratulations.Thank you. I would say one of my biggest goals is to have nine more, have a big family and support them through real estate investing. I want to keep buying commercial assets. I want to keep growing my brokerage so the more agents that I can bring on that are successful, the more money I make through splits with them, the more opportunities that they will find for me. I partner with a lot of my agents on deals because they’re cold calling. So just continue to grow things and become successful and support my community every way I can and renovating these properties and making affordable housing for people.

Dave:Good for you. I love that. That’s such a good goal. But I have to ask you, if you want 10 kids, how big is that primary home you just bought with your wife?

Remington:It’s pretty big. We’ve got about a little over 3,000 square feet, so we can definitely fill it up. Yeah,

Dave:Pack them in. Yeah, that’s great.

Remington:Yeah, pack them in. Army style barracks.

Dave:All right. Well, Remington, thank you so much. Again, congratulations. Love the approach to real estate. I think you’ve really accomplished a lot on hustle and effort and doing things the right way. So good for you. We’d love to keep up with you and hear about what you’re doing in real estate as you continue on this exciting journey.

Remington:Yeah. Thank you so much for the opportunity, David.

Dave:And thank you all so much for being here and for watching this episode of the BiggerPockets Podcast. We’ll see you all next time.