Episode Transcript
[00:00:00] Speaker A: Hey, everybody, you're kicking it with, kicking it with, kicking it with the Homeboys.
Hey, everybody, you're kicking it with the Homeboys and the Homeboys podcast. And we are so excited to be with you today. We are talking about the crossroads of America, and in particular, we're going to talk about our market, Indiana, which sits right in the middle of the crossroads of America, and why we like it so much and why it is an amazing place to invest in real estate. As always, I'm here with my very handsome co host and buddy, Scott Adams. How are you, my friend?
[00:00:41] Speaker B: I couldn't be better. I'm pretty excited. We were just on the Real Estate Guys podcast, which was really fun.
[00:00:47] Speaker A: You know, it's really exciting to get on a show whenever you're a fan of a certain podcast or a certain influencer and just to be able to. To be on and like, it was just such a great conversation. And it's really cool that, hey, we've been a fan of that show for a long time and here we are on there. So I just listened to the episode yesterday, actually, and you sounded really good.
[00:01:11] Speaker B: Oh, I haven't listened to it yet, but doesn't surprise me. I'm pretty amazing.
[00:01:14] Speaker A: You are pretty amazing.
[00:01:15] Speaker B: But really, it's, it's. It was neat because he's one of the OGs in our industry who was really around. I don't, I don't want to date him, but, you know, when I was starting my career, I really, really looked up to him, and I continue to look up to him. And it's one of those cases where, you know, sometimes they say, don't meet your ha. Heroes. Well, in this case, he lived up to all the hype. He's legit.
[00:01:37] Speaker A: He really did. And such a wealth of information, such a smart guy. And, you know, I also kind of went back and saw different guests that he had on his show and, like, well, you know, I'm a fan of a lot of those guests and, you know, hey, maybe we've arrived a little bit to be able to. To be on that, on that show. But, you know, we have a lot of experience.
We're over 50 years combined real estate experience, which really dates us. But we've seen it all.
[00:02:07] Speaker B: We have. And speaking of seeing it all, you know, we're going to talk today about why we love Indiana, not just personally, but as a real estate market. We're going to also go over an example property that kind of explains why we love it for real estate so much and why Indiana is Such a strong market and we're going to talk a little bit about why investors are sleeping on it. And I think this example will open some folks eyes who don't already know what a amazing cash flowing market is. But you know, first of all, we are big fans of Indiana because we both grew up here. So we have a love for this place.
[00:02:43] Speaker A: Yeah, we obviously have a bias because we've born and raised here. I was born and raised in southern Indiana, a little town called Rockport that you and I have both grown to love. We've done a lot of investing in that town and one thing that makes it so special is because it's, you know, kind of lodged in between two major markets. The third largest city in Kentucky in Owensboro and the third largest city in Indiana in Evansville.
But you know, we have had a ton of local support which is always amazing to invest in towns that want you. But yeah, growing up there, I did not realize how amazing Indiana was for real estate investing. I was just very blessed to be part of a community that, you know, Rockport, you know, everyone opens their doors to you. You know, the doors are still left unlocked and in a lot of, lot of areas of Rockport and everybody give you the shirt off their back. So being down there and being able to hobnob, you know, with the community is very special to me considering, you know, born and raised there. Homecoming King, 1997, South Spencer High School. The biggest landslide in homecoming king history for that school.
[00:04:00] Speaker B: Can we, can, can the audience guess when, when Clint peaked?
[00:04:04] Speaker A: Well, you know, it's funny, I was just talking to people a couple days ago in the office about class reunions and someone said, oh, I haven't been to a class reunion in forever. I can't wait for my class reunions because I don't know, we just, it wasn't that clicky. We were all just, you know, in it together. We started kindergarten, went through high school together and yeah, I've got a think a reunion coming up next year and I'm already excited.
[00:04:30] Speaker B: I think you're a perfect example of what makes Indiana special. I think folks maybe who live on the coast and think of, of most of the Midwest maybe as flyover country, there's some really special things about Indiana. The community here is pretty amazing. It's a great place for families to be.
We've got a really strong, diverse industry as well, you know, and I think people are sleeping on the fact that we're depending on what list you look at around the 13th largest city in the in the United States.
[00:05:02] Speaker A: You know, people always shocked to hear that.
[00:05:04] Speaker B: Yeah. So Indiana is a robust market, but it's also got the down home feel still that Clinton talks about and that I experienced as well growing up.
[00:05:15] Speaker A: But you never left where you grew up. You're still there.
[00:05:18] Speaker B: I'm still here. Still here.
[00:05:19] Speaker A: Hometown hero. Yeah, yeah.
[00:05:21] Speaker B: My, my grandfather was one of the first milkmen in Carmel. And I'm still here, you know, buying my milk at the grocery store. But yeah, I mean, we didn't go far because it's a lovely place to be and we just happened to, to be in this market that is one of the strongest real estate markets in the country for cash flowing real estate. How lucky are we?
[00:05:44] Speaker A: And I think it took us a long time earlier in our careers to realize how great, you know, Indiana was as far as real estate investing. I remember speaking at a lot of conferences out on the west coast whenever you and I first, you know, formed our partnership. And I remember a slide that we would have that we would put up on what I think it was 400,000, like what 400,000 would buy you in our market versus, you know, their market. We were talking more for like owner occupied, you know, real estate. But like people would be shocked that, you know, at that time $400,000 bought you a mansion, you know, here where $400,000, you know, you couldn't even enter the Bay Area market, you know, for 400, for $400,000. But that still holds true.
[00:06:31] Speaker B: You know, we are one of the more affordable markets in the United States. Even though we have one of the most robust economies.
We're a static linear market which is a dream come people who want to invest in cash flowing real estate. And the average purchase price of a home is still well under 300,000.
You know, for first time homebuyers here in Indiana. It's amazing. The numbers are just amazing. You can get a lot of value for dollars here and rents are still strong here. And we don't talk about this enough, but there is a shortage of rental housing still here in Indiana. A major shortage. I saw one report that said for affordable housing, this is just, you know, that sector of it, there's over 300,000 doors short from what demand is. So I mean, we have a major shortage.
[00:07:22] Speaker A: We see it in a lot of the markets that, that we go to. And it always blows my mind to see just how starved areas are for rental housing. You know, we got, you know, we talk about, you know, Rockport, Indiana and Southern Indiana.
You know, we Kind of got our start down there realizing how desperate it was by looking at a apartment complex for sale.
And, you know, if you remember, you know, the old man that, that owned that apartment complex wanted way too much money for it. But then we saw the wait list for this very average apartment complex, and we were like, oh, my gosh, like the. This area is just dying for rental properties. And that's what really brought us to that area of southern Indiana, because we saw the rental demand and now we live it and now we see it and we're able to provide the supply for all of that demand.
But we've always had it in our larger market here in Indianapolis. But a lot of the smaller markets, you know, are overlooked for sure. And, you know, that's a big part of the reason why we are in the suburbs and the cities that we are in, because we're in cities that have been overlooked but yet are dying for rental real estate.
[00:08:45] Speaker B: And they're lovely places to be, too. That's the other part. These aren't. You know, I think there's a stigma of maybe us being in the Rust Belt, that maybe some of these smaller towns are. Are trash, and we go to them. And you just were up in Elwood, another one of our areas where we've. We've developed, and you were talking about what a great day you had going to the Ten Plate Diner and having. What'd you have for lunch?
[00:09:09] Speaker A: I had a tenderloin Manhattan, which was a giant pork tenderloin the size of your plate. It was just unbelievable. It was just ungodly. You know how giant it was. But it was sitting on a bed of mashed potatoes and smothered in gravy. It was on Texas toast, mashed potatoes and smothered in gravy. And yeah, it was a heart attack on a plate, but it was amazing. And, you know, those little local places like that, you know, are hot spots for you and I whenever visiting these markets because you get to. Everyone's so friendly and they're excited that, you know, that we're investing in those communities and they're seeing them grow. And, you know, that particular market has seen a lot of growth because Red Gold Tomatoes actually move their corporate headquarters from California to Elwood, Indiana, and seen a really big jump in their local economy. And there's lots of markets like that.
[00:10:06] Speaker B: Yeah, don't be sleeping on Indiana, much less Indiana submarkets. I mean, we've. We've got some lovely places to spend time. And I'm going to go over a Quick example of an affordable house here.
It's one that we have, have, you know, for sale for, available for any investor that's, that's looking for good cash flow. But I just wanted to give a quick example for folks that, you know, wanted a more kind of detailed, nuanced idea of what it is we're talking about when we say there are great returns here. And in a case like this one, this is a house in Indianapolis. It's, it's a smaller house. It's a two bedroom, one bath, which is what this area has throughout. My father actually grew up in this neighborhood. Did I ever. Have I ever told you that?
[00:10:47] Speaker A: I think so. Yeah, I think so.
[00:10:50] Speaker B: So he used to ride his bike all around this neighborhood when he was a little kid growing up. But this is a cool little area and this house has been, keep in mind, it has been completely remodeled. It's, it's as good as the day it was built, if not better. It's refreshed, and it's for $124,000.
[00:11:06] Speaker A: A lot of people don't realize that you can still get great investment properties at that price, but they do still exist. And I just love being able to talk to our customers and hear the reaction because a lot of times we'll get 1031 exchanges and we're trying to hit a particular dollar amount and they'll get down to where they have under $150,000 left on their 1031. I'm like, hey, there's still great properties that we can add to your portfolio at this price. And they're amazed by that.
We have this one available, but I think we have quite a few others that are relatively, we do inexpensive.
[00:11:44] Speaker B: There's a caveat. You have to be so careful in this price range. If you don't work with somebody who is an absolute expert on these areas, you can get burned. You know, Clint and I have over 50 years of investing experience in these exact neighborhoods, so we know where to which properties work, what don't. And you have to be pretty careful at these lower price range. You should always be cautious with any real estate you're buying, but specifically, even more cautious on the lower priced inventory that you look at. If you don't have experts like Clint or I, you know, kind of hand selecting these properties that we would gladly own ourselves. In fact, we do own most of these properties before we sell them ourselves. But you know, you're getting an 11% cash on cash return with, with this property. So that equals about $300 a month in cash flow. So your mortgage payment is $300 a month less than what the rent that comes in. That's today. Keep in mind, rents go up over time and your mortgage payment stays the same so that those returns over time are going to increase exponentially. And it snowballs. And before you know it, that tenant has paid down your mortgage, you have captured all of that cash flow, increasing cash flow over time, and it equals a wonderful bundle of amazing cash returns. It beats anything else that we you can put it up against. And it's a real world asset in a market that, hey, I know I'm biased, but we love it here. We don't just love it for the cash flow, we actually love it here. Genuinely love living in Indiana. And the people that you get in these rental houses are good people. Hoosiers are amazing people.
[00:13:28] Speaker A: Hoosiers are amazing people. And the Indiana Hoosiers football team are also amazing. I'm going to the home opener tomorrow. National champions.
Yeah, it's a great time to be in Indiana. And I think our biggest takeaway that we want to really drive home is don't sleep on Indiana for real estate investing. And there's other markets in the Midwest also that are really prime for real estate investing. Scotty and I happen to be the foremost experts. I believe in investment real estate in the state of Indiana, but there are other great markets out there as well.
[00:14:06] Speaker B: Yeah. And if you're looking at those other markets, make sure you pick up our free ten plate, ten page report. It's six things to demand from any operator before you sign anything. So this is an amazing report that's on our website, homeboys podcast.com it's free. You want this report before you go out there and start looking for properties and start working with a provider, a realtor, a contractor, or whatever path you take, this report will help you along that path. It includes so much of the knowledge that Clint and I have put together over the last 50 plus years combined. And it's free to you. So feel free to go to homeboyspodcast.com, download that PDF, use it, and if you want to check out our properties While you're at homeboyspodcast.com, click those available properties. You can see the types of properties that Clint and I invest in, what we believe in, what our clients buy, and it's a great educational tool even if you're not shopping for yourself. It's a great way to learn the types of properties that Clint and I really believe in. So you can use those to compare and contrast when you're out there looking to invest.
[00:15:11] Speaker A: And if you want to get into contact with us, you can email us@saleshomeboys podcast.com you could always message us. You could always check out our other content across other social media platforms.
Again, do not sleep on the Midwest and do not sleep on Indiana.
We've been here for a long time. We've seen the success from our clients and we love helping people. So hey, don't hesitate to reach out to the homeboys. That's our show for today, so please keep investing and happy investing to you and we'll see you next time.
