A Topic Not Discussed in School: REI
On this episode of Next Level American Dream, Abigail and Sean are joined by Johnny Lynum. Johnny is an active duty United States Air Force Lieutenant Colonel, seasoned real estate investor, and entrepreneur. During the episode, he discusses how he was able to start from scratch in real estate to eventually growing to acquire multifamily properties, and how important it is to achieve financial freedom.
Key Topics
From 1 rental -> Multifamily
Achieving Financial Freedom
Connect with Johnny Lynum:
-
SUMMARY KEYWORDS
multifamily, people, real estate, deals, military, book, networking, American Dream, foreclosure, build, buy, years, business, big, continue, manage, active duty, property, focused, job
SPEAKERS
Sean Thomson, Abigail Thomson, Johnny Lynum
Abigail Thomson 00:01
Welcome to the Next Level American Dream Podcast brought to you by Thomson Multifamily Group. Your hosts, Abigail and Sean, will discuss how you can take your American Dream to the next level through real estate investing, business practices, and personal development. Join us as we share our experiences as a father daughter duo who are trying to accomplish our goal of financial freedom. We hope you learn more about how to define and achieve your American Dream. Here's another episode of Next Level American Dream. Welcome to the Next Level American Dream Podcast. We have an amazing guest for you today, but first, please make sure you have subscribed if you have not already. I also love getting your feedback, likes, comments, ratings, and reviews. Today, Sean speaks with Johnny Lynum. Johnny is an active-duty United States Air Force Lieutenant Colonel, seasoned real estate investor and entrepreneur. During his episode, he discusses how he started his business from scratch in real estate and eventually growing to acquire multifamily properties and how important it is to achieve financial freedom. If you found any value from today's episode, then please share it with a friend and help us grow. For more information on our sponsor, visit thomsonmultifamilygroup.com to start taking your American Dream to the next level through passive investing.
Sean Thomson 01:18
Hi, Johnny, thanks for being on next little American Dream podcast. How are you doing?
Johnny Lynum 01:21
Yeah, glad to be here today, Sean doing pretty good!
Sean Thomson 01:24
Let's start off by telling everybody what your background is and where you are today.
Johnny Lynum 01:28
Yep, so I'm a full-time active duty Air Force officer. I've been an Air Force now for nearly 16 years. And just continuing to love the journey of serving, I graduated did ROTC, the University of Alabama, came out of school in 2005. And really, just like most other people, you know, got a job started working with me was served in the Air Force and kind of saved a little bit here and there. And just kind of going along and then eventually kind of got more active into real estate and started on the single-family side with real estate investing. And kind of just over time here with the last year grew into the multifamily side of things are just now continue to grow in that space.
Sean Thomson 02:09
So let's talk about your transition into real estate. So, you're still active-duty military, and you still have a job every day that you're having to do and you're doing this real estate business really kind of side hustle for you. Let's talk about how you got to kind of get started and what was the catalyst for that? Were you trying to find something for a future? Or was it just what was it just something you kind of stumbled across? How did you get started in real estate, specifically?
Johnny Lynum 02:31
Really, for my wife and I, we moved to my first duty station bought a house one side of a duplex left in 2010. And it became a rental property, so by default, became a landlord. And just after that process, moving to the new duty station found a foreclosure and 2011 bought it knowing that I was eventually leaving it that we could rent it out. And you know, from there to more foreclosures, follow that in 2013 and 2017. And in between that time, it's like I was kind of a senior captain and got into you know, doing my my day job as a project manager. And you know, saving money for the government and doing those things. It was like, Hey, we can do this in real estate, we got a couple rental properties, let's sell those two rental properties we have in the Birmingham market, and do a fix, fix and flip here in the Northern Virginia area. And so that's what we done and didn't know everything, of course. But hey, I know I can manage contractors that work so I can manage contractors that building the house back together, I can manage the schedule on project. And so, I bet on myself and we found a project a bank foreclosure, we got our bid accepted. And we went after it. And you know, that was a great experience. It was our most extensive rehab that we completed back in 2015. And it kind of just set us on a crash course with real estate. From there. We did virtual flips for two years in Birmingham. And after Hurricane Michael hit the Panama City, Florida area, we kind of got even more active there in 2019 and then 2020 with purchasing our first multifamily last year. And now just looking to do more and more syndications and buy more deals.
Sean Thomson 04:05
Yeah, so it wasn't so much intentional to build some sort of future, but it was, it was you just saw how well it worked and how much of an opportunity there might be there. And it sort of just kind of continue to stack and grow. Right?
Johnny Lynum 04:16
It did. You know from day one, I knew I had my day job. I love my day job, you know, with doing what I do for the service. It was like how would my wife stay at home mom with the kids? Like how can we build a business together? You know, I've always kind of had in my entrepreneurial roots where whether it was a carwash or lawn service while I was going through college, you know, and other odds and jobs just create an extra income. And so, I was like hey, let's build a business but I know I have to work so I need to put the systems in place and had the right people with the right skill sets to execute this and make it happen. And so, from day one, we kind of went in with a system mindset we're having someone else that could be the property manager or the project manager with us being out of out of out of sight out of mind essentially, with we know, from Virginia to Birmingham, it was a 10 hour ride to get there. So we definitely needed to have boots on the ground in the right systems to be successful.
Sean Thomson 05:10
Yeah became managing them managing the managers in the process as opposed to actually swinging hammers. That's a much that's a much better approach, I think. So how did you kind of go? That was a few years ago, I guessing and or Gary not too long ago, but how did you go from your fix and flip business into wanting to expand into do other things? You said, you're headed into multifamily now? What was what was that transition? What was the thinking there?
Johnny Lynum 05:36
So really, for me, it was just attended give us just a mindset shift. Whereas I attended a multifamily centric conference in 2018. And from there just changed my whole mindset on how attainable actual multifamily was for where I was at currently, just what we were doing on a single family side. And just the the ability to scale the economy, you know, just the economy of scale, we have into all the doors right there. Just it made sense. And then the syndication piece, if you wanted to raise money, or if you just wanted to buy an apartment out, right, you had a lot of opportunities in that space. And it's very team centric. And I was good at building teams. And so after leaving that conference, I found I found an apartment that was on the market had been on the market 45 days, I was preparing for an appraisal. And just so happened, it was a commercial out behind us. And I went looking on MLS and it was there had been on there over 90 days, and we put it alone. And just like I had learned a few days a few months earlier at the conference and you know, leaned on my network of like, hey, look at look at my numbers, I put in the calculator, does this look right to you? We'll keep a little conservative, and I put my offering in. And we eventually, you know, over time negotiated and kind of split the difference. And we got it done all in the midst of COVID. I might add, which was just stressful within yourself alone.
Sean Thomson 06:51
Yeah. Well, that's good. And so so where are you headed? Now? Are you doing? are you focusing more on multifamily? Are you just taking opportunities as they come? Or what is it that you're hoping to accomplish sort of next and your real estate business?
Johnny Lynum 07:05
Yep. So I still had the single family business. I won't say it's on autopilot. But it it doesn't take up all of my time. And now you know, really focusing on the multifamily side, where we're doing two or three multifamily deals a year focused in you know, certain areas. Right now, we're focused in looking in Virginia, Tampa, Florida, Charlotte, North Carolina, and, you know, making some relationships in the right strategic alliances in the Atlanta market. And so we're actively looking there and continuing to just, you know, let you know, as I say, I say preach the gospel, let people know, hey, we're doing deals, the power of wealth, building the power of passive income, and the power of leverage in apartments to get that passive income to just be a long term generational wealth. And you know, from there, just, you know, bring it on private investors, people that's interested in kind of aligning their goals with where we're trying to go.
Sean Thomson 07:55
Yeah, so let's talk about your property. So you're focused in those markets. So you've, you've got a really targeted market segment there. And you also focus on specific types of properties or is there there's like a buy box that you keep within on your property types?
Johnny Lynum 08:10
Yep. For us, we're looking at, you know, primarily 20 to 60 units. It's kind of the sweet spot, which kind of peeling back the avatar, the seller on my 18 unit deal. They were baby boomers near retirement, they were self managing there was you know, they're with us, this was a unique when we actually took over an insurance claim as part of the property purchase, because they were dealing with the process had been over a year and a half, they had a tour of the buildings up and running to the quad Plex is up and renovated. But they had one that was just stuck with the insurance company, and they were just getting burdened down. They had other businesses that they own. So it's like, hey, there's a lot of people out here like this baby boomers that have been self managing that are tired of being landlords, and how do we reach these individuals and provide an offer to work directly with them to solve their problem, but then being able to provide the value add on the back side, once we take over the property? And kind of streamline the management? And in executing this a solid business plan?
Sean Thomson 09:09
Yeah, I think a lot of people, they they buy those properties, like you said, their family operations, but you know, COVID hit or something, something has gone wrong, but they have an insurance claim that takes a year and a half to deal with, you know, right. Some of these sometimes these things are difficult. And if you're small mom and pop operation, your capital is not there, sometimes just selling is your best option. But the people I think, you know, you would think that most of the time they really care for their property. It's kind of been their baby for a long time. So you know, it's it, you're getting a product, that's something that has been cared for and loved for a long time, but there's just maybe something an issue, so it might be good. There might be good opportunities there, like you said, so I think that's a good plan you have it sounds like it'd be a good way to go for sure.
Johnny Lynum 09:53
Yep. You know, one of the big things for us was just the entry barrier with the costs. Where's that, you know, for us, the earning Money deposits are a little bit more reasonable, you know, as on the lower end, and you can actually, if you run into issues, you're able to manage risk, and a whole lot lower low compared to a lot of the larger properties, you know, the numbers get, you know, get big, earnest money deposits, as you're going through due diligence calls. And just the price of raising capital that, you know, I started off, you know, with me being active duty that, hey, this is still a part time job, I have four years left before you know, I can I can make a decision or retirement at 20 years. And, you know, at that point, it hit some singles and continue to have a resume built up over time. And the internet can really scale up until the 100 plus units at that time. And that's kind of my my goal going forward is just over the next four years, you know, picking two or three multifamily and just building a broader base network to get it done.
Sean Thomson 10:52
Yeah, it sounds like a good plan. Well, you also have, let's talk about another component in your life, I guess, you you, you're running a book now. And the title to me was awesome. We talked a little bit before the show, you know, I think I just put my kids through college. I mentioned that to you, but I just put my kids through college. And I think kids don't learn, you know, they just don't learn how to how to look after themselves financially, you know, I think mindsets a big deal. And a lot of times, that's that stuff gets missed in school, but you're writing a book about some of that stuff, right?
Johnny Lynum 11:23
Yep, I am, I am, I actually got linked out with creative writing with Georgetown University back in the kind of me went around February timeframe, and just finished up my manuscript 42,000 words. And it was it was quite the process of going through a writing a book, and I kind of tackled my passion of just always given back to the younger generation, whether it's volunteer organizations like bicarb, and Atlanta, with working with upper rising teens that are looking to go into college, that, you know, there's a lack of financial literacy across the board. And I was a product of it, you know, I was finished third in my high school upon graduation was really academically excelling and smart, got electrical engineering degree minor in math and physics and went into the military. But I had no actual financial literacy when it came to, hey, how do stocks work? How does real estate market How does the economy work, because they give you all this math aside, you don't take any business classes, no finance classes. And so for me, it's like it was a learning curve that I had to get outside of the traditional means by just networking, going to workshops on Saturdays, from gurus that were selling courses, and just teaching about different concepts centered around real estate. And it kind of got me to the point where I could go off and execute, I could be a savvy landlord, I could look for foreclosures and know how to put a project together for a fix and flip and it kind of just grew over time. So for me, it was a natural extension of that, how do I give back with all the conversations I had with people who are looking to get started in real estate, like, okay, I can get this book, I can put it out here, and I can help way more people than 30 minute conversations that I can have time to actually have with people to kind of show them the strategies from the mindset piece, to actual just real estate, no kidding, taking action. These are strategies centered around single family and apartments, that you can build generational wealth and kind of change the course of how you how you do your finances and how you invest. Because one of the things I found in research from fidelity, I think, was 2017, that 88% of today's millionaires in the US are first generation millionaires that they saved or, you know, they were athlete, or they, you know, were a vice president of executive in a company, but they made their millions, they in this generation, it wasn't inherited. And so that was something that kind of piqued my curiosity, with just seeing how, you know, there's not a big turnover wealth generation, a generation, that you can actually get out here and put into work and be successful.
Sean Thomson 13:55
Yeah, and there's 1000 ways to do it, you know, and that's the thing about about America today, and that's part of our American Dream podcast, right? So it's achieving that American dream and, and there's 1000 ways to do it. But I think the what people are inundated with are not the the ways that it should, or that could happen for them, right? So stock stocks, bonds, and mutual fund investing in your 401k those sorts of things. They're not that's not going to get it, you know, you got to get out there and find hustles like you're dealing with real estate, or, you know, whatever it is that you create a business, you know, a lot of people create businesses and make a fortune, you know, so there's a lot of ways to do to earn money and make money and develop wealth. And you're not seeing those on on commercials, you know, Charles Schwab is not teaching you how to build your own business and make, you know, 50 you know, $50 million, whatever. He just wants you to buy his stocks, bonds and mutual funds, you know, and so I think sharing that information on how, you know, someone can take a side hustle and turn it into financial freedom is really an amazing thing. Right?
Johnny Lynum 14:56
It is, it is and you know, that's the thing that a lot of people take for granted. Just having an idea, whether it's anything that you're good at, if you if you have a product that you can sell for $1,000, and you sell it to just 1000 people that forgot how many billions of people that are in the world, but if you sell it to 1000 people, that's million that just made a million dollars, you know, something just as simple where's the people, they don't follow their passions, we get caught into the rat race, and we get stuck in dead end jobs that just kind of drain us, it stresses us out, it attacks our health. And it just holds us back from just being who we are put on this earth to be. And I think that's one of the biggest things for me isn't real estate, it's just a vehicle to give me back my time to get the time freedom, versus having to trade my time for money all the time. And you know, real estate, you can create the passive cash flow. And now you can live life on your own terms, and at the same time provide a quality product quality housing, for families to live in.
Sean Thomson 15:52
Yeah, exactly. Well, you may have just answered the question, but that's what I ask everybody on the show, what does the American Dream mean to you?
Johnny Lynum 16:01
Yep. And I think this is the time for you to just, you know, for me, you know, going on a couple of deployments, and just most recently, you know, at 2018, being away from the kids for six months, and my wife being pregnant at the time with our third child, and it just, it changed me. And, you know, for me, it was like, Hey, I can't keep doing this long term. And because I miss birthdays, you know, holidays and things like that events, that you can never get that time back. And you know, I recently lost my mom here early part of this summer. And you know, it's, it's just life is short, it's not promised, and you never know what you know, when's the last time you'll see your loved ones. And so for me, is being able to have the financial freedom to keep my time but to then spend the time wherever I want to with the family, and travel and just have those experiences that lasts forever. And I think that's the biggest thing for me. And just the benefit of real estate, it allows you to buy back time.
Sean Thomson 16:58
Yeah, well, since you've got the book and a few other things that you've done a lot of research, like you said, a 42,000 words, I guess you said Are there may be one or two things that you would maybe advise someone in your situation or similar situation to say, hey, I want to get started. But I don't know where to get started, or, hey, I'm kind of getting started wizards, there may be one or two things that you can tell someone to do that that would help them get get going.
Johnny Lynum 17:22
That's a great question. I think the the number one piece that when it comes down to what it takes to get started doing is take action. You know, there's so much content, you know, we'll watch the videos, we'll watch the podcast, we'll read the books, you know, we'll go to the conferences, but we won't take action. And I think the number one thing is take action, and you won't have 100% solution when you start I think Steve Harvey always says that, Hey, take jump off the cliff and build your parachute. While you're falling. That there's gonna there's gonna have to be a faith component to whatever it is that you're looking to do and be successful in. And you just got to you got to, you know, know that you Hey, you won't have it all figured out. But align yourself with the right people. Networking is powerful. And you know, if you have accountability groups, and people that's traveled that road that you're going down, that can help you be successful. And so I think taking action is is the big one. But then I think the and I kind of alluded to I think the sacred is just the power of networking, may be joining a mastermind definitely it changed my career expedition x my real estate career exponentially by joining a mastermind aligned with the right people, meeting people that I would have never met from just walking down the street that will another side of the world. And it just from that point it gave gave me the right tools and opportunities and network to be able to take down apartment deal to you know, to move forward with, you know, being able to have the opportunity presented with the opportunity to write a book and so things like that, that people take for granted were as they tried to stay secluded, you know, we're told as keys to not talk to strangers. But you know, when you think about it, like as you're trying to go somewhere you've never been there just strangers, strangers that have everything that you're looking for.
Sean Thomson 19:05
Yeah. So, yeah. Well, and I think a lot of people to that networking is is I'm horrible at it. I'm terrible at it. You know, I'm kind of awkward in groups and things that you know, and I stammer and stutter when I talk sometimes but but I think networking is is where it's at, because, you know, everybody, especially multifamily, no one is doing this by themselves. Everybody needs help. Everybody needs a component to a job to be filled in a project all the time. I'm always I always need someone with networth I always need capital, I always need help. I'm just always in need of help, you know. And so if you're if you're just getting started, go find those people in those masterminds, or in those networking groups that are that are kind of a little further along than you are maybe are a lot farther along than you are and find out what they need, you know, and fill those gaps then fill those voids for them. You know, I always need capital someone had capital You know, we can always put that capital to work, right? I'm always didn't deals too if someone had a deal, we would always figure out a way to make that work, you know? So I think that's a great advice. And I think people don't think of it that way. They, they see, they see you or they see me and they're like, Oh, this guy's got it all figured out what No, I'm, when I'm figuring out is I've got to put teams together all the time, you know, right. And so I'm always looking for resources, you know, people to bring into my deals and help me through the process. So I think that's missed. And a lot of a lot of cases when people do that, they, they, they just don't see it as an opportunity. But it really is. So let's talk about where can people kind of reach out to you and get more information? Maybe I guess, when is your book coming out? Is that gonna be available?
Johnny Lynum 20:45
Yep, so pre sale is going through pretty much towards the end of August. So pre sale right now is happening, and then and for our pre sale. So there's a great opportunity where people get become beta to get autographed copy to give a shout out in the book and recognition. And they also I'm putting on a couple real estate investing seminars, for my pre sale backers for our campaign. But then the book will actually come out in December, will it actually be produced and be out to Amazon for master distribution, and here in the Barnes and Nobles in the DC area, and available on the website before, it's just contacted me johnnylynum.com. And from there, you can kind of see some of our syndication piece what operation invests my company there and get more information about us just everything that we're doing for the YouTube the book, in speaking engagements, that we're kicking off a local meetup here in the DC area. And, you know, just continue just to educate the masses and just help people understand the criticality of taking action now, and starting to focus in on building wealth, just to to set things up for the next generation. And so I think is super important. And unfortunately, like we talked about, it's not taught all the time in school.
Sean Thomson 22:00
Yeah, it doesn't come from your institutions that are available to us today. You had to kind of get out there and find it yourself. What was your website? And again, what was the name of the website?
Johnny Lynum 22:09
Yep, www.johnnylynum.com
Sean Thomson 22:13
Okay, great. So people can go there, they can look at, you know, maybe getting your book, maybe get more information about you guys meet up, see what you got going on, learn more, it's like I said, if someone's getting started, you'd be a good resource to go to probably to help them kind of get into a network really quickly.
Johnny Lynum 22:29
Most definitely. So the thing that the fourth quarter of this year that we're looking to kick off a mastermind group that's centered on real estate investing, and just for those looking to implement and get started and need someone that they can actually ask questions, and we're not D is by we're looking to grow that into a good mastermind group. And so that's the that's the plan for the fourth quarter this year. 2021.
Sean Thomson 22:52
Yeah. Well, and we touched on it early when we started talking, but I don't think we mentioned it again, I wanted to mention it again, that your your active duty military guy, and you're laying the groundwork for your future beyond the military, and you're making that happen in your life. And this is how you're doing it. So I think I think that's an important thing. You know, I told you earlier, I think you're the third or fourth one we've had on the show that's doing that, right. And I think a lot of people that go in the military that sometimes they forget to plan for their time outside the military. And I think this may be a good way to do it. I'm glad you came on to talk about what your journey has been. So maybe someone else is out there in the military thinking, What am I going to do next? And this, this might be a path for them? Yeah, that's, I'm glad you came on and said that or shared that.
Johnny Lynum 23:35
Most definitely. And that's one of the things that I'm passionate about the veterans that we have so many intangible skills when it comes to leading and, you know, how do you translate those skills that you have from, you know, being combat ready and being able to execute in those type of environments to come back into business room to broker deals, and to provide value to somebody else's business team, our value to your own team that you create as entrepreneur? And so I definitely don't think a lot of people foster those skill sets, they pick up in the military to kind of translate out to some of those entrepreneurial type activities on outside.
Sean Thomson 24:11
Well, and no one in the military is coming out in the 1%. You know, that's just not happening. You just don't get paid enough in the military. You know, so if you're not doing something else, to kind of prepare yourself for your financial future, you know, it just it's not your it's not the military is not not that paying you enough to pair wealthy for sure. If you're when you retire, it's great. Don't get me wrong. It's really good stability and all that sort of thing. But you're not, you're just not developed that wealth. Putting in your time in the military. It's a it's a it's a much harder job than that. So. Well, thanks a lot for joining. I really appreciate you coming on. It's great to meet you. I love hearing your story. I think the book ideas are awesome. And I really hope you guys have a ton of success in the future. And hopefully we can get you back on talk about how things are going later on down the road too, okay?
Johnny Lynum 25:01
I definitely appreciate the opportunity, Sean. Thanks a lot!
Sean Thomson 25:04
We'll talk to you soon.
Abigail Thomson 25:06
Thanks for joining us for another episode of Next Level American Dream. If you would like to learn more about what we talked about today, want to contact the team directly, or are interested in passively investing and being a part of our deal room, head over to our website at www.thomsonmultifamilygroup.com -- Before you go, please leave a review! Your comments help us create more episodes for you to enjoy.