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064: Passive Investing for Working Professionals with Lane Kawaoka


Lane Kawaoka is a City Project Engineer and a Licensed Professional with a Masters degree in Civil Engineering and a Bachelors in Industrial Engineering both from the University of Washington in Seattle. Aside from his day job, he is the co-owner of MPFE Investments, focused on value-add multifamily apartments (currently own 260+ units), and manager of the Simple Passive Cashflow Fund.

Lane’s passion project SimplePassiveCashflow.com, is a free podcast and online learning resource in passive real estate investing. Working as a high paid professional in Corporate America and frustrated by the traditional wealth building dogma, Lane was compelled to inspire and mentor other working professionals on how to do real estate investing and build their own portfolios. Lane urges other working professionals to just get started saving the for the 20% down payment for a conventional loan to acquire a single family home rental. The Simple Passive Cashflow method is for buying investments with a healthy cashflow buffer that can withstand a market downturn. Lane has received much appreciation for his work via kind words from his audience.

In addition to mentoring, Lane also partners with beginning investors who want to build their portfolio, but are too busy to handle direct investments. He uses his engineering mind, investing knowledge, and network to optimize investment returns for others via a diversified fund backed by real estate called “The Simple Passive Cashflow Fund.”

Key Points

Getting started investing in real estate accidentally – by chasing the American dream
Live where you want to and invest where the numbers make sense
Identifying your highest and best use of your time
Changing your mindset in order to transition to large multifamily deals
Lightning Questions

What was your biggest hurdle getting started in real estate investing, and how did you overcome it?
Lane became an accidental landlord. He first needed proof of concept before he got started.
Do you have a personal habit that contributes to your success.
Lane gets things done starting every day with a morning routine.
Do you have an online resource that you find valuable?
Lane googles things to find out the things he doesn know, with the mentality of “take life by the horns”
What book would you recommend to the listeners and why?
The Millionaire Real Estate Investor by Gary Keller
If you were to give advice to your 20 year old self to get started in real estate investing, what would it be?
Lane started small, protected his downside, and focuses on growth. Lane credits much of his success to the mindset around getting started. Own the suck.


Simpe Passive Cashflow Podcast

Contact Lane

063: Rules of Thumb – Friday Fundamentals

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Real estate investing is a numbers game. If you’re just getting started investing or are an experienced investor, you understand this.

From analyzing deals, crunching numbers, and estimating expenses to searching for deals, making offers and closing, everything revolves around the numbers.

We’ve talked about the importance of keeping a full pipeline of deals. If you’ve looked at 100 deals, maybe only 50 of those deals appear worth analyzing further. Out of these 50 properties, maybe only 10 are worth making an offer on. Out of the 10 offers, you might only have 1 accepted.

Rent to Value Ratio (RV Ratio) – ratio of the purchase price to the monthly rents. For example, if you purchase a property for $100,000 and the total rents are $1,000 per month, then the RV ratio is 1%

Most real estate investors consider 1% RV ratios to be a good rule of thumb. However, that number is highly dependent on your market and property type. Markets like San Francisco, Chicago, and New York will be harder to find 1% RV ratios, whereas markets that are known for cashflow – typically cities in the South Midwest, like Memphis, St. Louis, Indianapolis, & Mobile, might be much easier to find 1% RV ratios and perhaps even higher.

Gross Rent Multiplier (GRM) – is another metric very similar to the RV ratio. It’s a ratio of the purchase price to the annual gross rents. So let’s say you take the same $100k property, with $1,000/month rents for a total of $12k annual rents. $100k divided by the annual rent of $12K gives us a 8.33 GRM.

This GRM tells us how many years it would take to pay for itself with gross rents received. Keep in mind, this isn’t reality, as you will have expenses and a mortgage to deduct from the gross rents.

2% rule. When analyzing deals, it’s important to be able to estimate the expenses of a property. When estimating expenses, there is a rule of thumb called the 2% rule. This is the income to expense ratio. So let’s take our $1,000 per month rent. The rent to expense ratio of 2% will tell us that our expected expenses will be $500.

Another way of putting this is your expenses will be roughly half of the total rents.

Keep in mind that the expenses calculated in this number do not include your Principal and Interest payment.

By using these numbers, you can quickly assess whether a property is worth further analyzing with more accurate numbers. This will allow you to more efficiently analyze more deals, leading you to more offers and ultimately, more properties!

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062: Maximizing Your Exit Strategy with Aaron Hendon


Aaron Hendon is a Seattle Realtor, real estate investor, author, educator and speaker. He is managing partner of Christine & Company, a Seattle Magazine awarded, Five Star Real Estate Agent, winning team for the past 5 years and individual Rising Star in Seattle Real Estate winner this year.

Bringing together a diverse background and history including transformational leadership, entrepreneurial start ups and traditional cold calling sales, Aaron and his team consistently out perform the local market, selling homes for over 5% more than local market averages.
Born in New York, Aaron graduated SUNY Purchase with a BFA in 1997. Discovering his fine art degree made him eligible to work in the food service industry anywhere in the country. Moving to New Mexico immediately after school, he eventually found his stride, opening a real New York bagel shop in Albuquerque, selling it 9 years later as a business grossing over $1,000,000 annually.
Eventually landing in the Northwest in 2000, he now lives on a small island off the coast of Seattle with his brilliant wife, Kael, his two brilliant children, Leela and Jonah and his adoring, if not exactly brilliant, Golden Doodle, Rozy. He is currently at work on his next book, Real Estate Blind Spots – What People Don’t Know They Don’t Know About Buying and Selling Their Home (and what it costs them).

Key Points

How to interview real estate agents – metrics, questions, and things you should know
How qualified is your real estate agent? Find out!
Ways to work well with your agent
How to find agents

Shortchanged by Shortcuts by Aaron Hendon

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061: Grow Your Mindset to Grow Your Portfolio – Friday Fundamentals

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Grow Your Mindset to Grow Your Portfolio As real estate investors, our goal is to constantly grow our portfolio of rental properties.Starting out, this process may seem relatively quick for some. You might buy your first property, and soon after another and another. Eventually, you’ll start running out of capital to invest. As a real…

060: How to Raise Funds Legally with Amy Wan


Amy Wan is the Founder & CEO of Bootstrap Legal. She is an attorney who specializes in real estate syndication and crowdfunding for entrepreneurs across the globe. Her mission is to democratize access to legal counsel and capital.

Previously, she was a Partner at Trowbridge Sidoti LLP (CrowdfundingLawyers.net) where she practiced crowdfunding and syndication law, and was General Counsel at Patch of Land, a real estate marketplace lending and crowdfunding platform. Amy is also Founder and Co-Organizer of Legal Hackers LA and served as a Presidential Management Fellow.

Key Points

Differences in syndication and crowdfunding
General SEC regulations
Regulation A+ vs. Regulation CF
ABN – Always Be Networking

BootStrap Legal

Contact Amy

BootStrap Legal: (330) 269-9260



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