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SHOW NOTES FOR EPISODE 309: DOING REAL ESTATE AS A DIGITAL NOMAD
He just wanted to do good things to help others, but when he lost his dream non-profit job, Matt Bowles had no choice but to take control of his life and turn things around. In this fascinating podcast, co-founder of Maverick Investor Group, entrepreneur, podcast host, real estate investor and digital nomad Matt Bowles shares how he was able leverage his firing into a dream lifestyle that pays him to travel the world, living in 50 countries in 6 years, meeting tons of interesting people and having the freedom to go wherever he wants whenever he wants.
What You Will Learn
- How to become a “house hacker” for profit
- What are the 3 “profit centers” every rental property should generate?
- How to get paid helping others while growing a rental property portfolio
- Why “hot markets” change and how you can leverage this
- What his key “hot markets” are today
- What type of real restate investing is not good
- Why traditional Financial Retirement Planning doesn’t work
- What is a “Digital Nomad” and how can you get paid to travel the world
About Our Guest
Matt Bowles
Matt Bowles co-founded Maverick Investor Group (www.MaverickInvestorGroup.com) in 2007 to help individual real estate investors buy performing rental properties in top U.S. real estate markets, regardless of where they live. Matt and his co-founders at Maverick have helped individual real estate investors buy over $100 million in residential investment property across 15 States.
His company was built with a unique virtual infrastructure to facilitate “location independence” and lifestyle freedom for Maverick partners and their staff. Matt runs his company from rooftop pool decks in Dubai, beaches in Rio de Janeiro and cafes in Paris. He has been a full time digital nomad and lived in over 50 different countries since 2013.
And, as a socially conscious business, Maverick Investor Group donates 10% of their net revenue to causes that affect positive change in the world.
Matt is also the host of The Maverick Show podcast (www.TheMaverickShow.com) where he interviews today’s most interesting real estate investors, entrepreneurs, and world travelers, and pulls out actionable tips and advice that listeners can begin applying in their own lives each week.
Matt is a sought after speaker at events and conferences around the world relating to real estate investing, entrepreneurship, long-term world travel and the digital nomad lifestyle. He has been featured in major national media and was named one of the “Top 50 Real Estate Opinion Makers and Market Leaders” by Personal Real Estate Investor Magazine.
More About Matt
- He has a unique lifestyle that revolves around a business that he has established that allows him the freedom to travel continuously
- He is able to travel the world, 7 days a week, by joining with other like-minded entrepreneurs, who are doing the same thing, and who support each other
- He and his “business partners” are all:
- Location independent
- Have removed geographic restrictions from themselves
- Have the freedom of mobility to live wherever they want for as long as they want
- To design their lifestyle on their own terms
- His core passion is social justice activism, trying to effect positive change in the world
- His earned an undergrad degree in Sociology
- Masters degree in International Peace and Conflict Resolution
- Spent a big part of his life doing volunteer work in international human rights issues
- Then he worked in the non-profit world in Washington, DC
- It became apparent, early on, that he wasn’t going to make a lot of money working in the non-profit world
- He loved his work but survival was an issue
- He wanted to do investing on the side so he could build wealth and still work in the non-profit world
Becoming a Real Estate Investor
- He figured the best way to invest and live off of his investments is through real estate
- That way, he could continue working in non-profit without having to worry about how much the non-profits can pay him
- He started reading all the books he could on real estate
- Then he purchased his first real estate investment – a house
- He bought a 4-bedroom house in 2004
- He lived in one room and rented out the other 3 to friends
- He now had three streams of income
- Rental income cash flow
- Property equity and appreciation
- Tax savings
- The house went up 40% in value after the first year
- He realized he made more, in one year, with the value appreciation of the house, than he earned in his salary with the non-profit in the same year
- Now he was even more pumped and read even more books on real estate investing
- He did a cash-out re-finance of his property to pull out investment capital
- With the investment capital, he started buying out-of-state rental properties
- He researched the best markets and invested there
- His friends saw his success and wanted to learn how to do the same
- He was showing them as he was continuing to learn himself
- He tracked everything he was doing:
- How he was buying
- How he’s finding the properties
- The companies he is working with to find the properties
- He did this to really understand the out-of-state business model he was creating
- More and more people where approaching him to invest out-of state
Major Change in Plans
- Walked into his non-profit job one day and found out there was a change in management and he was let go
- It turned his world upside down
- The reason he was doing real estate was so he could do the non-profit world but now he had to re-engineer to totally replace non-profit salary
- He was 30 years old
- Massive shake-up
- He had to turn in his phone (owned by the non-profit)
- Driving out of the parking lot, he couldn’t even call his mom or friends to tell them he lost his job because he no longer had a phone
- He had to drive to a Verizon store to buy a phone to call his mother
- He had a major revelation on the way to the Verizon store
- He was not going to apply for another non-profit job
- He would start his own business that day
- And he would do something that he already knew how to do well – teach others how to buy investment real estate in out-of-state markets
- What he was doing for free, he would start charging others to do
Launching His Turn Key Business
- After, he bought the phone and called his mom, he drove to the bookstore and bought books on “How to Start a Business”
- He realized there were skills he didn’t have that were necessary in running a successful business
- Decided he would need partners – together, they could create an amazing company
- He joined with other real estate investors, took the best of what they all knew and created what they called “The Maverick Approach” to real estate investing
- There goal was helping people to buy performing, turn-key properties
- already rented out
- already cash flowing
- already renovated
- His business focus was to help the investor by doing all the back work
- He has been doing this for 12 years now
His Personal Investing Strategy
- Even though he is very busy with his turn key business, he is still actively investing
- He continues to grow his business and generate income to purchase more investment properties
- He takes the active income from the business, puts it into his retirement account and then uses the retirement account to invest in more investment properties
- He’s doing the same thing he teaches his clients to do
- When he first started buying properties (during the boom before the crash), he wasn’t buying them correctly (based on key fundamentals)
- He bought the properties on speculation, not on cash flow
- He had to sell many of those properties, even lost some to foreclosure
- So he is in the process of rebuilding his portfolio, one property at a time
Selecting Investment Markets
- There is no “national US real estate market”
- You really need to look at real estate markets locally
- Ten years ago, markets like Phoenix, AZ were hot (2010), but today:
- Rents have not gone up to match property values
- The homes are still cash flowing well and have lots of equity
- The cap rates are compressed
- Therefore, you are not getting the return to match the value, based on the high home prices
- In 2012, they started buying in Atlanta, GA
- Low home prices
- Rents were high
- It was good for a while
- But now home prices skyrocketed and rents didn’t
- Today, their focus is more in the midwest
- St Louis, MO
- Ohio
- Indianapolis
- A few locations on the East Coast
- The way they have structured their business model:
- They set up their business, from the beginning to “location independent”
- Find the best markets at the time their clients are ready to buy and buy there
- They didn’t want to set up individual brokerage offices in specific markets because markets are always changing and they’d have to move
- Setting up offices in specific areas would be restricting for their investors
- The best markets change overtime
- If they would have set up an office in Phoenix when they first started and things were hot, there would be no activity there today
- They are client-driven, based on the clients needs – the markets are picked based on their clients’ needs
Biggest Mistake
- Buying based on speculation and market appreciation, not cash flow
- A rental property has a number of profit centers
- Market appreciation is only one of those profit centers – it should be your least important profit centers
- There’s cash flow – the most important
- Depreciation
- Tenant’s rent pays down the mortgage and the property equity grows
- You need to make your money when you buy!
- Buy properties that are already performing
- You should be making money the day you close on that property
- If the market appreciates, it’s a bonus, but it shouldn’t be the primary reason to buy – you don’t need it to be profitable if you buy right
Biggest Success
- His first rental property
- It cash flowed right away
- It appreciated 40% in the first year
- It was a success, however, because he got the cash flow from the other three tenants starting the day he closed
- The experience opened his eyes to the power of real estate as an asset class
On Being a Digital Nomad
- Bill initially found Matt through one of his podcasts (episode #16 on The Maverick Show) where his guest was a guy named David Dang Vu, a successful entrepreneur who has built multiple million dollar businesses that he manages while traveling the world. One of which is an AirBNB Arbitrage business that generates $300,000 a year in passive income.
- The interview took place on a cruise ship with a bunch of people calling themselves “Digital Nomads” (this was the first time Bill heard the term)
- Matt’s definition of Digital Nomads
- Location independent people
- Not homeless but houseless
- Don’t generally maintain one primary residence
- Travels around the world
- Has the mobility and agility to move around the world and live in different places for as long as they want. For example:
- Stayed in Cairo, Egypt for 9 months
- Stayed in Buenos Aries, Argentina for 3 months
- A Digital Nomad can live as long as they want wherever they want
- Location independent people
- Investopedia’s Definition:
- Digital nomads are people who are location independent and use technology to perform their job.
- Digital Nomad Communities
- Matt has been plugging into communities of Digital Nomads
- Some of the people are entrepreneurs with interesting businesses that allow them “location independence”
- Some are real estate investors, living off of their passive income from their rental properties
- Matt sees this as an “incredible movement” of sorts by an increasing number of people who are saying, “Wow! We really want to go see the world, live extraordinary lifestyles and design our lives in this way: to live in incredible places and do incredible things.”
- However, as great as the digital nomad lifestyle may seem, one of the biggest challenges, especially for those traveling alone, is that they can get very lonely. So what has happened is that a number of companies have come into this space and are now developing Digital Nomad meet-ups, programs, cruises and amazing travel opportunities just for digital nomads. At these events, Matt would meet fascinating people with incredible stories and he thought, “Gee, if I only had a couple microphones and could record this!” And that’s what spawned the formation of The Maverick Show Podcast.
- Matt has been plugging into communities of Digital Nomads
- Old Dawg Digital Nomads
- There are a number of seniors or 50 plusers who are digital nomads
- Matt interviewed one digital nomad who started his journey at age 50
- The man sold his house and everything he owned
- He is now traveling the world with the goal of visiting every country in the world and sharing his adventures on his podcast
- Matt has been a digital nomad for over 6 years
- He has mastered the art of traveling with only a carry-on bag and even teaches a workshop at nomad events on “How to travel the world for a year with only carry-on luggage and still be stylish.”
- To him, being a digital nomad has had a very powerful psychologically liberating effect
- To take off and live anywhere in the world, at a moments notice, and not worry about it – it is very liberating
- Minimizing his material possessions has helped him to focus and prioritize his life on valuing experiences and people as opposed to material objects and things
- He spends his money and emotional energy on creating memories, doing amazing things with amazing people and building relationships as opposed to buying and stock piling material items, bigger and better TVs, cars, more clothes in his closet and all kinds of stuff. He wants to put all his resources on experiences and people
- He has mastered the art of traveling with only a carry-on bag and even teaches a workshop at nomad events on “How to travel the world for a year with only carry-on luggage and still be stylish.”
Advice for Old Dawgs Interested in Real Estate Investing
- It’s never too late to start in real estate
- Matt referenced his interview with Bill and how he started at 58 in real estate investing
- You need to think about the advantages of residential investment property compared to whatever your money’s in now
- If you buy a rental property right, it is significantly better than most other investments out there
- Educate Yourself
- Do your homework
- research on how to buy right
- Buy that first property and test the waters. That’s the only way to figure out if it’s for you
- The Real Goal: You only need to generate enough passive income to cover your living expenses
- Traditional Financial Planning Approach:
- Work your entire life for someone else
- Build up a big nest egg
- Live off off of your nest egg
- Pray that you don’t die before your nest egg runs out
- Matt recommends a more “Maverick” approach to financial planning:
- Allow your money to work for you in a more meaningful way
- Invest in rental properties
- They will generate passive income income while giving you other profit centers at the same time (equity, depreciation, tax savings, etc.
What About Seniors Interested in Living the Digital Nomad Lifestyle. Is it Worth it?
- First, you’ll save lots of money
- Before Matt became a digital nomad, he lived in LA
- Paid ridiculous rent
- Had car expenses
- Monthly loan payment
- Insurance
- Gas
- Maintenance and repairs
- Just the cost of living in LA was crazy. Things like…
- Going to dinner
- Parking
- Entertainment
- Taxes
- One day, he just sold all his “stuff” and hit the road
- Before Matt became a digital nomad, he lived in LA
- He traveled to a different country each month, four different continents, over the course of a year
- Including all his international airfare, his total living expenses, compared to when he was living in LA, was significantly less
- The US is almost the most expensive place in the world to live
- The majority of the world is cheaper than the US
- For example, one of his favorite countries in the world is Thailand.
- A major Digital Nomad hub in Thailand is a place called Chaing Mai
- A fully furnished apartment in Chiang Mai, with all utilities (including high speed WIFI), is only $300 US a month
- You can go out to dinner at a nice recommended restaurant and have a full mean for $3
- You can live in Chiang Mai for a year for only $7,500
- Furnished apartment
- All transportation
- Meals
- All living expenses
Current Business
- Everyone in his company is location independent
- He is probably the one who travels the most in his company
- He’s lived in 50 countries in the last 6 years
- His partner Valerie is based in Washington, DC but travels a lot but always comes back to DC
- Mark is based in Chicago with wife and daughter, living in an area where they want to raise their daughter
- Everyone in the company has the choice of where and how they want to live
- He is probably the one who travels the most in his company
- They hire staff people from all over the world (Virtual Assistants)
- Social Media Manager is in London
- Podcast Production Assistant in the Philippines
- Sales Director is based in Boston
- Contractor Close Coordinator is based in California
- They do special market presentations with clients in key markets they are investing in
- They are a licensed real estate brokerage in Nevada and have an address there
Rap-It-Up
- Favorite real estate book: What Real Estate Investors Need to Know About Cash Flow by Frank Gallinelli
- Favorite business book: The 4-Hour Workweek by Tim Ferriss
- Most valuable web site for success (other than your own): TimFerriss.com
- Favorite app: Roam2Rio
- Favorite quote: “Look at yourself in the mirror and ask yourself, ‘What do I want to do every day for the rest of my life?’ and do it!” – Gary Vanderchuk
- If you had to start all over, knowing what you know, and you only had $1,000, what would you do to launch your real estate investing business? Start building relationships with people like other podcasters and get them to come to your website or follow on social media. Get in front of people. Provide value. Ask them what they want. Give them what they want.
Get a Free Report From Matt – How to Avoid the 7 Biggest Mistakes Real Estate Investors are Making in the Current Boom Cycle
How Can You Reach Matt
- Website: https://www.maverickinvestorgroup.com
- Podcast: https://www.themaverickshow.com/
- To find out more about the Digital Nomad Lifestyle: https://www.mavericknomadlife.com/
This show was sponsored by CBRE
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