TGCI 184: From lifting houses (literally) to buying multifamily!

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Episode 184: From lifting houses (literally) to buying multifamily!

Copy of EP #18 - 2 Guests

Summary

In today’s show, Pancham interviews Jason Yarusi – an active real estate syndicator and real estate investor, host of The Multifamily Live Podcast, founder of New Jersey Multifamily Live Club, and founding and managing member of Yarusi Holdings.

Through podcasts, conferences, his investment firm, and his investment club, he has been consistently inspiring people to learn more about multifamily investing and its benefits. Today, he manages over 1400 units valued at $160 million in assets under management, has over 2,500 members in his investing club, and is dedicated to helping investors reach their goals!

In this episode, learn more about multifamily investing as he shares his journey on how he discovered and learned to love multifamily investing! He’ll also guide us as he shares what you need to look out for whether you’re actively or passively investing, and what their current strategy looks like given the current market state!

 

Listen and enjoy the show!

PanchamHeadshotTGCI
Pancham Gupta
Screen Shot 2022-04-08 at 10.18.55 AM
Jason Yarusi

Tune in to this show and enjoy!

Copy of Quote #00 - 1 Guest

Timestamped Shownotes:

  • 0:34 – Pancham introduces Jason to the show
  • 2:52 – On transitioning from lifting houses to investing in multifamily
  • 11:26 – Scaling up the business through hiring the right people
  • 12:36 – Narrowing investing opportunities to align with your goals
  • 16:46 – Why active investors should know and understand their limits
  • 21:48 – His outlook on the current market and how they deal with it
  • 25:25 – How their event would help you get started in multifamily investing
  • 29:21 – Taking the Leap Round
  • 29:21 – House flipping as his 1st investment outside of Wall Street
  • 30:03 – Lessons learned from his 1st house flipping investment
  • 31:56 – The investment that didn’t work out as expected
  • 33:05 – Why investors should take the leap after finding out their goals
  • 34:02 – How you can connect with Jason

3 Key Points:

  1. For passive investors, it’s best to invest with someone who always provides constant communication. This would help provide transparency and build trust with others.
  2. Instead of investing in all kinds of assets, limit yourselves when investing actively to prevent making bad decisions and simply focus on where you can provide value.
  3. Limiting your opportunities will actually expand your opportunities as it could help rookie investors be clear on their goals and align them with their investing strategy.

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Read Full Transcript

Welcome to The Gold Collar Investor podcast with your host, Pancham Gupta. This podcast is dedicated to helping the high-paid professionals to break out of the Wall Street investments and create multiple income streams. Here’s your host, Pancham Gupta.

 

Hi, this is Joe Fairless. If you want to diversify out of Wall Street investments, then listen to The Gold Collar Investor podcast.

 

Pancham Gupta: Welcome to The Gold Collar Investor podcast. This is your host, Pancham. Really appreciate you for tuning in today. My guest is Jason Yarusi. He is an active real estate syndicator. He and I started around the same time into multi-family space. We were at a panel when we bought our first deal right after that, and talked about our first deal. Jason and his wife, Pili, founded Yarusi Holdings, a multi-family investment firm with over 100 units acquired since 2016. The firm repositions properties through operational efficiencies, moderate to extensive renovations, and complete rebranding. 

 

Jason also hosts the Multifamily Live podcast, a podcast that provides actionable content and tools to build and strengthen your multi-family business. Jason is founder of the New Jersey Multifamily Life Club with over 2,500 members that focuses on real estate syndication and multi-family investing, and trains others on the success formula to buying apartment buildings at 7figuremultifamily.com. 

 

Jason has started and exited multiple businesses in the past 15 years. His family construction business has a niche industry position in raising and moving structures. The company has elevated over 2,000 homes in the last seven years alone. Beyond real estate, Jason spends time with his wife, Pili, and three young kiddos, Luke, Lily, and Leo, and is an avid CrossFitter, and now lives in Tennessee. Jason, welcome to the show.

 

Jason Yarusi: Thank you for having me. Excited to be here.

 

Pancham Gupta: Yeah. It’s been a while. It feels like – you were saying – we’ve seen each other through social media for a very long time. I think the last we met, we were on the same panel in 2018 or 2019; I don’t remember the year. It’s been really good to have you on the show.

 

Jason Yarusi: Yeah. It’s great to be here. Honestly, it might have been 2018, which is crazy how quick it’s been. We’re saying, social media makes you feel like you’re still within range of being connected, but yeah, it’s been, face-to-face, a couple years now.

 

Pancham Gupta: Yeah. I’m excited about this show. Before we get started, are you ready to fire up my listeners, break our Wall Street investments?

 

Jason Yarusi: Sure, I am. Let’s do this.

 

Pancham Gupta: Let’s do this. Before we get started, can you give my listeners your brief background and more importantly, the person behind that background?

 

Jason Yarusi: Sure. My name is Jason Yarusi. I run a multi-family investment firm, Yarusi Holdings. We’re down in Tennessee. We’ve acquired a little over 1,400 units, about $160 million of real estate in the multi-family space since 2017. My wife is my partner on the team. That’s the big overview, which we can dive a lot into. We moved into the multi-family space, that 2016 mark, after just finding that we really want to dial in to really control our time, and dictate how our life went, and get away from letting life run us.

 

Pancham Gupta: Before multi-family, what were you doing? How did this light bulb, or whatever, the moment of truth — 2016, you decided you want to do multi-family? What were you doing before?

 

Jason Yarusi: Yeah, traditional route. Back in early 2000, 2003, I ended up meeting my wife — not my wife at the time, of course. I met Pili. She’s running a bar in New York City. I ended up working at that bar doing construction. Ended up working with her at that bar for a number of years. She moved out west to do a couple other things. I ended up running this bar. Grows to a massive place. I think the revenue, 25X over the course of it in New York City. Really blew up. It was something interesting. I ended up opening up restaurants, and opening up and selling a brewery there in New York City. 

 

Lo and behold, Pili moves back; we become a couple, and Hurricane Sandy happens in New Jersey. On the premise of that, Pilli and I were talking about what’s the next step in our life. Working till 12:00 am, 2:00 am, 3:00 am, 4:00 am has a certain toll on you and also limits, of course, life on itself. Same thing with the service business, if you’re not doing, you’re not getting. You have to be active to, of course, make income. 

 

Hurricane Sandy happens. My dad has a business where he lifts houses. He actually lifts houses for a number of reasons: foundation issues, setbacks, also flooding reasons.  [Sandy] decimates the East Coast. All these homeowners, of course, are displaced out of homes. Their homes have all been flooded. My dad’s business, going from 12, 13, 14 jobs a year, goes to hundreds of hundreds of calls daily. My brother, who was working for me at the time, Pili, of course, my girlfriend, we ended up saying, “Well, let’s go help Dad.” We moved out to New Jersey, helped him really start taking that business into a new direction, and really keep up with the demand. 

 

Over the course of the next couple of years, we did over 2,000 projects. Very busy time. Helped a lot of homeowners get home. If we could’ve worked 25 hours in a day, we could have done it. That’s how busy it was. We were set in stone. Here we are, new path, same story. We’re limited on time, because time is driving us. Pili is pregnant now with our first kiddo. We were like, “We have to change this,” because if you don’t stop the train and get off, it just never stops. 

 

Lo and behold, you’re looking back decades ago and say, “What just happened?” We kept kicking the wall saying, “What else is there?” Real estate kept coming up on that topic. We did what we thought was logical. She went on and got a real estate license while pregnant. Now, she’s a licensed agent, and we decided to start flipping homes, wholesaling homes, and doing a lot of things. Cool, it was going well; we were creating more income. We’re still doing the construction and helping dad, but now, we basically have two active things that have to be done to keep things going. 

 

Now, we’re like, “Okay, we have a goal. We’re doing this real estate thing, but it’s now taking us farther and farther from the goal.” Pili meets someone at ARIA who’s doing out-of-state investing. They’re basically buying properties, putting together a team, rented them out. Of course, that was something that the lightbulb clicked on. We’re doing this thing in New York City where we would help put together teams. We have to put together processes. Everybody was winning, because everybody was doing their superpower. 

 

We started buying some properties out of state, some two units, some three units. From that, lo and behold, [plan] starts going in. We’re not actively doing anything besides, of course, managing and putting people in the right spot, and checks start showing up in the mail. That was that light bulb. We’re like, “Oh, understood.” 

 

However, it wasn’t scalable to a point that it can make a dent to get us to where we want to be. We kept it a process, kept holding on, on that. I came upon, on a podcast like this, someone speaking about large multi-family investing. That was that aha moment of saying, “Well, that is it.” That’s how you can take and really produce, on the economics of scale level, on a large impact, was large apartment investing. We sold off those couple properties. We went all-in in 2016. That leads us back to our story before purchasing our first 94-unit in 2017, and the road has been forward from there.

 

Puncham Gupta: Awesome, man. This is a great story. Now, I remember, on the panel, that was the thing that you were talking about in 2018 — the first 94-unit property. 

 

Jason Yarusi: Yeah, for sure. 

 

Puncham Gupta: I think I was talking about the 44-unit property that we had bought. That was our first property. I think we started this journey at the same time. 

 

Jason Yarusi: We sure did. 

 

Pancham Gupta: Fast forward 2017, you buy your first one, and now, you have 1,600 doors, $160 million worth of assets under management. That is awesome. Someone listening to the show, if that’s not inspiring, you should listen to Jason more. Let’s dive into this. Since then, you have actually moved out of New Jersey into Tennessee. We were talking just before the show. Why was that? Tell us a little bit about that move.

 

Jason Yarusi: Pili grew up in Hawaii. That’s where she was born and raised. We met in New York City. We moved back to New Jersey, and a lot of my family is there. It was great, but again, there’s always more to see out there. We have three little kiddos. Now, they’re seven, five, and three. At the time, they were five, three, and one. School wasn’t really happening with COVID. They were in school, out of school, on Zoom school. There was nothing really tying us to say, “Okay, the kids need to be at school.” If there’s any time to go out there and just try something different, now is it. 

 

We’re looking out. We’ve looked at Denver, Phoenix, Nashville. We really liked Denver. We really like Phoenix. I think we’re on Denver overload. We’ve been there a couple of times for things, and Phoenix. We like getting outside a lot. We were just a little more in the desert than we want to be. It was getting closer to Hawaii, but it wasn’t like we could just get in the car and drive there. Partner that with we’ve been investing 1,000 miles away mainly in the Louisville area and  some of the southeast from New Jersey. Now, we’d basically be investing 1,000 miles away just from Denver or Phoenix. 

 

Got our mind back to Nashville. We just decided to move down here, and what’s the worst that can happen? We moved down here. We love it now. If we didn’t, we’ll just move somewhere else. Moved down here back about 15, 16 months ago, and it’s been a great change. Kids love it. It has just been a lot of fun.

 

Pancham Gupta: Awesome. It was not more of a business-motivated move. It was more of a personal situation, getting something new into your life.

 

Jason Yarusi: Yeah, just a change. The business area — is it nice to be close to your properties? Yeah, sure, probably. I live in a town with two here. I don’t go there weekly. I maybe go once a month to the assets. I got great teams on the spot. I don’t need to be over there. I have checks and balances, everything, to put myself in the best position to make sure those transactions are carrying through in the right way with the business plan. However, is it nice to have some face-to-face with some of the active people here? Yeah, absolutely. Is it required by any means? No, not at all. 

 

It does put us in a good spot from the fact of actually looking to be more opportunistic. With our construction background, we have a couple of development projects now here locally. If I was in New Jersey, I wouldn’t have the foresight to understand the market, understand that point. I also wouldn’t have the bandwidth to be able to do that from 1,000 miles away here, what we’re doing.

 

Pancham Gupta: Cool. Given what you have now achieved, you moved, you have $160 million worth of assets under management, what’s next for you? What keeps you up at night? Maybe you have a very good night’s sleep, but what’s the next step?

 

Jason Yarusi: I don’t know if it’s really keeping me up at night,  but our growth has been stymied by me just not putting more people in the right position on our team here. We’ve been hiring right now. We’re bringing on a director of acquisitions, bringing on a social media manager, bringing on other people for the team here, where we’ve grown. We’ve done a great job organically. Our current team has just done fantastic, but we need more help. You become the bottleneck to where you want to go. 

 

Helping other people, empowering other people, putting them in good roles here, so we can really grow out to build where we want to be. That’s the next step here. We’re constantly looking for a deal quarter. That’s been our goal. That’s been a good part, just doing the steps. We say we’re passively aggressive to that approach here of looking for that one-deal-a-quarter. That keeps us on track with the actions we’re doing right now, which keeps us in line to typically be somewhere [near] to closing that deal a quarter.

 

Pancham Gupta: Got it. Good. Let me ask you, a shift of focus here, two questions — one from the viewpoint of a passive investor and one from the viewpoint of an active investor. They’re listening to you, great story, and they’re thinking, “Yeah. You know what? I listen to so many podcasts. Every time I listen to a guest, I get wowed by their background.” What is something that they should be looking for if they’re looking at a new operator? If they get motivated after listening to you, what should they be looking at when they’re first investing passively?

 

Jason Yarusi: One is that, do your goals align?  If they’re looking for a cash flow out of the gate, and I only have a development opportunity, it’s not going to be right for them. Also, you want consistency and communication. You want to understand that. How has that operator shown up consistently here? What I find is that, say, you’re on the active side and you’re new to the multi-family space, you’re not going to have that to fall back on, but how have you worked in other capacities of your career? What else have you done consistently, and shown up, and gotten it done? 

 

I would be fearful if an operator had on his Facebook page 57 new businesses that have opened, that haven’t gone anywhere in the next three or four years or the last three or four years. Looking forward here, multi-family syndication or multi-family acquisitions, they’re longer plays. You have to be dialed in. 

 

Also communication. It’s very easy to just forget to keep investors on the know, but from the gate, we’ve made a very large, large focus on consistent communication with investors, having quick time to get back to them, and making sure that if we have the answer right away, great. If we don’t, we will give them a time frame to get the answer for them and get back with that answer.

 

Pancham Gupta: Got it, okay. Also, you’re a pretty big fan of why narrow focus produces the most opportunities. If a passive investor is listening, how can they find out what the focus of the team or the operator is?

 

Jason Yarusi: You want to see if they have clear bumpers on what they’re trying to invest in. It also helps us find opportunities. If I just go and say, “Hey, Mister/Missus broker. I want to buy real estate. I want to buy apartment buildings.” They don’t know how to help me. Maybe that’s a five-unit. Maybe that’s a 100-unit. Maybe it’s 1,000-unit. Is it new construction? Is it class C? They don’t know how to help me. I won’t be able to identify the opportunities that actually work for us. If we’re clear on the opportunities we’re looking forward, then we can be clear on how they operate, and how they could operate, and then find the gems, or find the ones that are underperforming based on what the other properties in that market are doing — being very clear on what you’re looking for. 

 

That also helps us. Let’s say I buy 75-150 unit B, C assets built between 1985-2005 in the east, southeast, south of Louisville. If I say that, the brokers, the bankers, the investors, everybody gets a clearer idea of what I’m searching for. They’ll also be able to help me if they know of an opportunity, see opportunity, or identify an opportunity, or know of different things that may have happened that could help better on my analysis to be able to help me get to my goal, because I’ve now been very clear with them what we’re looking to do and what we’re searching for.

 

Pancham Gupta: Got it. It’s really questioning them, really asking them, looking at their past portfolio, seeing what they’re focused on and are they looking for similar stuff.

 

Jason Yarusi: It helps too for your investors, because it helps them understand that if more opportunities come in the future, it may be right for them. We want them to be very excited to be part of the project. We don’t want them to be on board just for the sake of it. If it’s not the right opportunity for them, I’d rather them wait, or find other things that are going to better fit their investor profile, what they’re looking to achieve. 

 

Pancham Gupta: Yep, makes sense. Now, let’s switch to active investors. Someone who’s listening to this, they are so motivated after listening to your story, going from buying one, two units to 1,600 units. What advice would you have for them if they want to get started here and become an active investor?

 

Jason Yarusi: Find where your limits are. If you’re good at a lot of pieces, great, but where can you best forward to get yourself in? Whether you’re good at lead generation or underwriting, where can you fit? It’s a team sport, you can do a lot out of the gate, but where can you provide value? Also get focused on where you want to be. Many times, the grass always looks greener, but if you’re going to focus on every market, you’re going to get beat to the punch so many times, because there’s people that are really dialed in on where they’re investing. They’re going to understand the opportunities better, and be able to act quicker, and make better choices on what to go after here. 

 

Start very dialed in on what you want. You may say, “Well, this is going to limit my opportunities.” It will actually expand your opportunities. If you have 150 deals to underwrite across the US, you’re going to spend so much bandwidth just trying to figure out where you are in the market, what part of the neighborhood you are, what the schools are, what the average income is, what are all these points, what are the rent comms. You’re going to not have a clue and not have the time to truly analyze all these opportunities, which could lead you to 1) missing out on, of course, many deals, 2) also making potentially bad decisions based on a deal.

 

Pancham Gupta: Right, cool. I want to switch gears here. Just to summarize, before I do that, for the passive investors, what you’re really saying is, find out from the operators what their focus is, see what they’re dialed in and if it aligns with your goals. Also look at their past performance, how they have done it with those deals. With the active investors, again, the same thing, but really dial in your focus, see what you really want, and narrow focus actually produces more opportunities than less. Cool. 

 

Now, I want to talk about your morning routine actually. I don’t ask this question quite often, but  given I follow you on Facebook. Every once in a while, I see you posting stuff. I wake up early, but not at 4:30 am. You have a 4:32 am wake-up time. Tell us about that, your routine. You follow that pretty religiously. Why 4:32 am, not 4:30 am? 

 

Jason Yarusi: Sure. It gets to a point of getting back to just using the energy that we have on decisions that need to be made. You hear it so often, “Oh, I don’t have time,” or “I don’t have this and this,” but if you look at the true decisions you’re making each day, “Oh, what should I eat? What should I wear? Should I do this in the morning, or should I do that?”, you’re wasting all this time making decisions that can be basically just mapped in and aren’t going to dictate how your life can unfold here. 

 

Getting up in the morning here, hitting snooze, no one ever hits snooze and says, “Oh, I slept seven more minutes; I feel better.” I started getting back to wanting time with my kids. If I’m getting up at 7:00 am, and they need to be in school at 8:00 am, and I want to have time to workout, do other things, I wasn’t going to be able to have the time to commit to being with my kids. 

 

I started getting up at 4:32 — 4, 3, 2, 1, go, get out of bed. From there, drink a glass of water, or have coffee. I’ll meditate, stretch, and then I’ll work out. I typically work out with a kettlebell and run. I come back from that moment to just set my mind in the right spot, so I can now go forward and be present with my family in this case. Typically, at that time, Pili is up. She’ll be able to have her moment. Now, I can go spend time with the kids. We can get them off on their day. I can spend my energy basically on things that need to have my energy. 

 

It’s pretty much a routine thing. The second part, I’m pretty dialed in on just how my day goes. When things come up, I want to be focused. I’d rather be here speaking to you and be able to focus speaking to you, instead of thinking about the 900 things that I need to make a choice on that, ultimately, a year, two years, five years from now, I know it won’t matter, because I won’t even remember what those choices were that I was trying to spend my energy on.

 

Pancham Gupta: Yeah, that’s so true. I can speak from my personal experience. I’m not as religious as you, but I do wake up early. The days when I do not, I think I completely lose control of the day. I get that when the time in the day gets started. Kids are going to school. I have to be with them. I want to be with them. In my mind, I’m thinking, “Oh my god. I didn’t do my meditation.” As soon as they leave, I’m working. Email starts flying in, and you just can’t focus at all on your daily routine. I go through the SAVERS routine, Miracle Morning. 

 

Jason Yarusi: Yeah, it’s great. 

 

Pancham Gupta: It’s so hard. I’ve been thinking lately during meditation and when I’m visualizing things. What are you thinking about the market given where it is today? I don’t know how it is in Tennessee. I don’t look at deals there. I’m sure the cap rates have compressed crazy, and the market is going up, and up, and up. What are you seeing there? What’s your strategy given what’s happening?

 

Jason Yarusi: We need to think about this: we’re not in a bubble across the entire US. Sometimes, there’s talk about – everything happens together. The news will say, “We’re in a bubble.” The way certain markets are impacted, of course, is going to be completely different. You’ll see, sometimes, a track of markets being impacted. It could be months, it could be years, differently. Just understanding where you’re investing currently, what are the drivers, where are the push poles of what’s actually put in there. Really, a big part to look at right now is wage inflation versus price inflation. 

 

I don’t want to be exposed for points where I’m into assets. We were investing a lot of C assets in Louisville. We’ve now positioned more into B and up, just because, unfortunately, the C tenant is more exposed. They’re more exposed to an hourly paycheck, working at a Walmart, or at Costco, or working for Amazon than someone who has a consistent paycheck coming in there. They’re going to be more exposed to that rent increase or to other points here that have to match from an ownership side based on demand. 

 

We’re looking at better product, newer product, putting on debt that’s not going to put us at a very high risk profile, and then looking at the ability to have a business plan that can sustain over the long run. It’s not going to be so focused on short-term returns based on the unpredictability we have ahead.

 

Pancham Gupta: Got it. What are you doing with the Ds that you have currently which are like C deals?

 

Jason Yarusi: Actually, I’ve exited on all of them except one that will go up to the market soon. I’ve actually exited most of them, believe it or not. We’ve done a full cycle on a number of them. They’re still performing great. The 165-unit, that’s still on our board. We’re ahead on performer rents. The business [plans moving a park] here. I just wouldn’t want to take that on right now with a massive point of trying to turn the whole building. You would expose yourself to the point of having a lot of need. A lot of things have to work in your favor and have the runway continued behind you. Is there still a runway there? Yeah, a simple supply and demand. We need units. We don’t have units. We don’t have other ways to meet the demands, and it’s been a long time since we’ve met demands. Again, you will have that point where it will start getting over the hill.

 

Pancham Gupta: Yeah, exactly. We’ve done the same thing. At the same time, if the market turns, would you hold that property in your portfolio, or would you still sell it?

 

Jason Yarusi: It’s a fine property to hold. We’re a little early. You look sometimes where the exit point is. You want to make the best objective call for your investors. Right now, based on where we are, ahead on the project, it makes good sense to test the market for a sale. If we were just keeping on the business plan, there’s no reason we can’t hold it either. The debt sustains us,  holding longer. It also gives us the opportunity to make a good choice, because it’s a local bank. We have no exit penalty there too. It also gives us a way to go out there and see whether the market can work without having a part where we’re impacted by the treasury bill.

 

Pancham Gupta: Great. Thank you, Jason, for that. Now, I want to quickly ask you, before we move on to the second part of the show, which I call taking the leap round. You have started this multi-family conference, something you and your wife do. Talk to us about that and talk to the listeners. What was the goal, why you started it? How has it evolved over time? 

 

Jason Yarusi: We had a great opportunity to start mentoring some other people that were looking to get into multi-family. That led us to start a mastermind called 7 Figure Multifamily. We started that little just about a year up coming here. It’s going to be a year in June. We have about 50 businesses in there now, which have been so much fun to see people just taking action, just controlling the narrative, whether it be to buy their first multi-family building or a larger one. It’s been great to help them with steps that we’ve done, tried and true steps, to get to that goal. 

 

We did an event last year, a virtual event called Multifamily Live. We’re excited to do this year’s event. That is going to be Multifamily Live in person, in Nashville at the Opryland. If you’ve been to the Opryland Hotel, it’s quite a spot to be at. We’ll be doing that June 2, 3, and 4. You can go over to multifamilyliveevent.com. Find everything out about the event. It’s going to be all dialed in for multi-family. It’ll be great for active investors, passive investors to learn more about the multi-family space and investing in multi-family.

 

Pancham Gupta: That’s great. Is it you and your wife talking mainly, or is it more, you have guests on different topics?

 

Jason Yarusi: We have two other partners, Bill Allen and Chad King, that are also there. Those are our partners for 7 Figure Multifamily. My wife, the two of them, and myself will be our main speakers. We have a number of great other speakers too, part of the group, and other points to come in there and talk about how they’ve grown, and take the multi-family business to the next level.

 

Pancham Gupta: That’s awesome, cool. Anyone listening and interested in multi-family, definitely go check out 7 Figure. What’s the website?

 

Jason Yarusi: 7figuremultifamily.com.

 

Pancham Gupta: That’s awesome, great. Thank you, Jason. We’ll be back after this message. 

 

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Do you ever feel overwhelmed by the thought that you have no time after work and family time to learn about investing? Do you feel left behind that you are not putting your money to work for you? Do you want to create passive income, but you do not know where to start? If so, I have good news for you. I have created an investor club which I call The Gold Collar Investor Club for accredited investors. I will be putting together investing opportunities exclusively for this group. These are the opportunities where I have done my part of the due diligence for you and will be investing my own money alongside you. 

 

If you are interested, please sign up on thegoldcollarinvestor.com/club. I repeat: thegoldcollarinvestor.com/club. I will reach out to schedule a 30-minute phone conversation to discuss your investing goals once you sign up. This can be a good opportunity to diversify and take some chips off the hands of Wall Street to produce some cash flow. 

 

In case you are wondering what is an accredited investor, an accredited investor is someone who has earned more than $200,000 filing single or more than $300,000 filing jointly for the last two years. Another way to qualify as an accredited investor is if your total net worth is more than $1 million excluding your personal home. It includes your stocks, 401(k)s, IRAs, cars, etc., just not the equity in your personal home. If this is you, I would highly encourage you to sign up. 



Pancham Gupta: Let’s move on to the second part of the show, Jason. I call this taking the leap round. I ask these four questions to every guest on the show. My first question for you is, when was the first time you invested outside of Wall Street?

 

Jason Yarusi: First time I invested outside of Wall Street was, honestly, buying real estate. It was buying a flip that was, of course, storm-torned. We bought a flip that was ravaged by Hurricane Sandy. Bought it in cash. Had a really heavy, heavy repositioning plan for that. Made money but the timeline is the one thing – when you don’t have a plan or process very dialed in,  our four-month timeline ended up being a nine-month timeline.

 

Pancham Gupta: Yeah. The devil is in the details. 

 

Jason Yarusi: Exactly. 

 

Pancham Gupta: All right. My second question, did you have any fears when you bought that completely storm-torned house?

 

Jaron Yarusi: I would say no, because we actually did the most complicated plan for any first flip ever. We were lifting these homes. We’re making them, hopefully, flood-resistant for the future, because we’re putting it at a higher level. We actually had the idea that we took the home, and we raised it up two-storeys in the air, and built another floor underneath it. Instead of having just a cape cod, it became a two-storey home, and then we built the garage underneath. 

 

We took that home, and we doubled the living square footage, added a full garage. We took on a pretty complicated plan. Where we went off-step in the timeline here is that, with so many flooded homes, so many houses that needed to be worked on, your typical 20-day permit ended up taking 3.5 months. You have to give the utility shutoff. With all the storm happening – a typical utility shutoff will take a week – that was taking another maybe six to eight weeks. We lost so much time that was outside of our control. 

 

That was part of the reason, transitioning from that type of flip, the value was there, what wasn’t there is the ability for us to control the plan. There were too many things. You have a permit office or a construction department that’s maybe doing 50 projects a year. All of a sudden, now, they’re doing 1,000. Of course, they’re not going to be able to keep up. You’re running against things that were outside of your control, which is why we had to make a change to get back to things that we can control the part of the process, just like getting up early. If I can’t predict when the permit is going to come out, I can’t send anybody up to work. I’m saying, “I hope it will be out in two weeks.” Nobody can schedule around hope.

 

Pancham Gupta: Wow. I don’t know how you lift homes, man. That’s a scary thought. Question number three for you. Can you share with us one investment that did not go as expected other than this 9.5-month timeline? 

 

Jason Yarusi: We did another one like this. We were in flood zones, but there was another one that was a floodway. We ended up pre-selling it prior to finishing it up. We doubled the [first day], lifted it up. Lo and behold, because of just how much work that the construction office was getting in terms of permitting, they decided to hire their engineering department, basically hire out to a third-party company.

 

When we put this permit in, they figured out that they would fire that company and bring it back in-house. We got stuck in this washing machine effect here where they weren’t quite doing it yet, and the third-party company was now checked out. They wouldn’t dial in to get our permit done. That I was talking about, we lost another three months on it. We had a pre-sold home that we couldn’t give a final timeline to give it out there. 

 

Pancham Gupta: Wow. You do these things and you learn, right? 

 

Jason Yarusi: We sure do. We learned how to work the system, so you can make sure that you’re in a system that can work for you. 

 

Pancham Gupta: Yeah, exactly. All right, my last question for you is, what is one piece of advice would you give to people who are thinking of investing in main street, that is outside Wall Street? 

 

Jason Yarusi: You want to find where your route is and just keep on point by just taking steps forward to that. You can’t constantly think about what you want to do. You have to try something. Just like flipping., if we didn’t do flipping, we didn’t know if we’d like it or not. Just like multi-family, maybe you’ll like it, maybe you won’t. You have to take a step towards a direction, it could be any opportunity, just to learn better questions, so you can get better answers. We don’t know all the answers, and that’s what we usually are looking for, but the doing is where you’ll produce the answers. 

 

Go out there. You want to flip a home? Go see if there’s someone you can walk beside with. [See actively. Go where the normal people are going, because maybe, it is right for you, but maybe, you’re not going to like it at all. It’s better to just find out what you don’t like, so you can eliminate that and get you quicker on what you will like. 

 

Pancham Gupta: Great advice. Thank you, Jason. This has been great. How can listeners connect with you if they want to reach out? 

 

Jason Yarusi: Sure. Of course, you can go, come join us at the event. Would love to have you. You can go to yarusiholdings.com. Learn about past opportunities, about the future opportunities. We’d love to talk with you. 

 

Pancham Gupta. Great. Thank you, man. 

 

Jason Yarusi: Thank you. 

 

Pancham Gupta: Thank you for joining me today. I appreciate it. If you have questions, email them to me at p@thegoldcollarinvestor.com. This is Pancham signing off. Until next time. Take care. 

 

Thank you for listening to The Gold Collar Investor podcast. If you’ve loved what you’re heard and you want more of Pancham Gupta, visit us at www.thegoldcollarinvestor.com and follow us on Facebook at The Gold Collar Investor. The information on this podcast are opinions. As always, please consult your own financial team before investing. 

Copy of EP #18 - 2 Guests

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