How to Make $10K–$40K a Month from ONE Home with Senior Living | Isabelle Guarino

What is up, Science of Flipping Family?

I'm very excited.

For those of you that like cash flow, for those of you that like investments that can create wealth and a whole lot of money along the way, this is going to be your episode.

I have with me boss lady herself.

She has taught thousands and thousands, maybe tens of thousands of individuals about the senior living space.

She herself owns a lot of senior living.

They're also known as ALFs.

And if you are interested in trying to find a business model to grow wealth and grow massive amounts of income and do good by people, Isabel Garino is here.

Yes.

Thanks for having me.

Let's do this.

Yes, excited to be here.

I'm very excited.

I think it's an under-taught, underspoken about sector of our space.

I've done however many thousands of deals in my life.

And to this very moment, as I'm sitting in front of you, I've not done an ALF or a senior living.

What are you waiting for?

What am I waiting for?

Off camera, we were just talking about,

Friday, I got text.

Hey, we have an available one here in Miami.

Common in Miami.

Yep.

You're in Phoenix.

Yeah.

Coffee pretty common there.

I would say Florida and Arizona are the most popular places.

Okay.

Yeah.

And so I think people that are in real estate are silly, and it includes me.

Yeah.

I'm calling myself out.

That you don't look at this.

I mean, the reality is I have looked at it at very surface level.

The returns are insane.

The income is insane.

And it's real estate.

Yep.

The other sector of that is also a business.

Yes.

And that's why I think people don't look at it because they say, I'm not a medical professional.

I don't know what I'm doing.

I don't want to work in a home or be a caregiver.

So they get turned away by the myths and misconceptions of what it is.

It really is a business in real estate at the end of the day, but you can make the business very passive.

It's not a passive business, but you can make it passive.

You can become a passive owner.

And that's what we show real estate investors how to do.

Talk to me like a student.

Tell me like exactly what you just said.

And then let's elongate on that because the reality is.

I, even me, right?

After 20 years of doing this business, I would be like, man, I just said this to you.

Oh, it's another business.

I would be creating another business for myself and I don't need another, right?

And that's me trying to keep in my visionary self like corralled in because I'll be like, yeah, let's go buy one.

Let's go do that.

Yeah.

Right.

But talk to us about what it is and how you separate it and how, how should people be looking at this asset?

So when people think of assisted living, they think of that big, stuffy box, right?

Exactly, right?

Long hallways, impersonal staff where you're literally called by your room number.

And that is equivalent to prison, if you ask me, right?

Like that's terrible.

They're getting horrible care.

It's 30 seniors to one caregiver ratio, and none of us want to go there at the end.

We're talking about those big, almost apartment-looking, massive 250-door things.

Exactly.

That's what we all think of, when we think of assisted living.

So, this is like what Airbnbs did to hotels.

This is a residential home that can house anywhere from six to 16 seniors in the home.

It's still giving you that 24-7 care, but at a four-to-one or five-to-one ratio.

So, significantly better care, right?

And it's in a home.

So you don't have to go to this institutional feel.

You get to stay in maybe the same neighborhood you always grew up in, and it's the same cost.

So you're getting better care, better food, better location, and you're paying the same.

So for the seniors and the families, it makes a ton of sense.

For the real estate investor who says, well, maybe I'm not ready for multifamily or ready for commercial yet.

I wouldn't even go that direction anyways.

I don't care that it makes more money.

I don't feel good about myself at the end of the day if I was to own a big, big box, right?

Right.

In a smaller care home, the seniors are actually getting the quality care they paid for.

So now your real estate investment, you're getting a check for six grand wrapped in a love letter.

Yeah.

10 times a month.

That feels real good.

Like you're like, okay, I could do that.

Thank you for taking care of my mom or my grandma or whoever.

My wife has her grandmother is in one right now.

Yeah.

And so I'm very knowledgeable while you're talking.

It's a normal single-family home.

Yeah.

In a normal neighborhood.

Yes.

I think there's three bedrooms.

There's six women.

Okay.

There's three nurses.

Okay.

And every time we go there, there's like, I mean, literally all three nurses are there on staff.

Yeah.

All the women are sitting and watching and playing cards and doing.

Yeah.

And I'm like, God, that's great.

Because listen, at the end of the day, the end of people's lives can be tough.

It's tough.

Right.

It's very difficult.

It's almost like the Benjamin Button story.

It's like you turn into it like a child, right?

Yep.

You're playing games and hanging out.

That's right.

Yes.

It's really tough.

So talk to us about,

you know, the idea of separating church and state.

And what I say is like the real estate side from the business side.

Yes.

Because if you're going to run one, there is the business component.

We can't hide from that.

No.

Talk to us about that.

Okay.

So on the real estate side, a lot of people, what they're doing right now is buying real estate and turning it into an ALF or an RAL, as we call it, residential assisted living.

Is that hard to turn it?

Like if I just bought a home in Miami, is it hard to turn one into?

Not necessarily, but the more like the keys are, right?

This is what really what you're looking for is the demographics of the area.

You want to be in where the majority population is 50 years old and older making two times the median income okay that's not the senior that's the adult child that's right because they're the ones usually paying me it's almost seal right they're the ones paying for mom or dad to go into the home right so you want to target them because they don't want to drive 45 minutes away where it's cheaper they want to drive five minutes on their way home yeah so where the affluent 50 plus community is that's where we want the home okay and then the larger the footprint the better so i really prefer private bedrooms, private bathrooms.

Depending on where you are in the country, you're allowed to have between six and 16.

So here in Florida, your state says 12, but most of your counties say six or eight.

We're talking about people.

People, residents in the home.

Yes.

In Arizona, I'm limited to 10.

Texas is 16.

New York is 16.

So it just depends where you are.

So like my homes in Phoenix, they started as a 6'5

and now they're 1010s.

Okay.

So I renovated them to become that way, you know, didn't even have to do any addition because think like 300 to 500 square feet per resident.

So for 10, minimum 3,000 square feet, upwards of 5,000 is pretty comfortable.

Yeah.

And we're just taking a home and chopping it up differently so that it can serve these seniors' needs.

It doesn't matter.

So you almost make it a

the new kiddos these days, a house.

Pad splits.

It's similar but different in the sense that they're getting rid of living spaces, office, everything.

We still keep all of that.

Like

similar but we're like the luxury version of them so i'm only familiar with the one my wife's grandwright which is just a normal like they do everything it's just three bedrooms two

two women per bedroom they didn't add bedrooms yep which people do all the time you could do either you could do either it's just for maximum profitability they want private bedrooms oh yeah So let's talk about numbers.

Like what can you get?

I mean, compared to just a single family long-term rental the numbers are staggering oh it's crazy so uh average cost in our country right now today is fifty nine hundred dollars per month per resident I don't know how much she's paying because she's in a shared room so it might be more might be less even just think about that would be like just the month of of a tenant oh yeah okay that would be but now you have six

or ten yep so in in my case right 590 5900 let's now we're gonna get me to go squirrel on this let's call it 6 000 just for easy math okay so 6 000 because also remember, average includes our friends on government funding as well as our private pay friends.

And we only focus on private pay.

Okay.

So for the most part, that $5,900 is kind of low for me and most of our students.

They're getting seven, eight, nine, $10,000 per resident per month.

Because of the government-funded?

No, we don't do any government-funded.

Government funding is about $1,800 a month.

Oh, so you go the other way, probably.

Other way, private.

That's why you want to be in the mid-50s so the kids that can afford them to have

making two times the median income, they can afford afford it, right?

So let's call it $6,000 a month, $6,000 times 10 residents, 60,000 coming in.

Your mortgage these days to get a nice home like that, it's going to cost you 10 grand, right?

Like easily.

Okay.

Because if you're getting a large home and you're renovating it and whatever the case is, it's going to cost you like $40,000 a month to run a 10-bed home, a very average 10-bed home.

And I'm saying that.

People, because all the business operational costs.

The operational, yep.

So you're caregivers, right?

Insanely expensive.

Okay.

Food, activities, cable, utilities, internet, just everything.

Throw it all in their liability insurance, whatever.

That one home is still bringing you in $10,000 a month.

So

it's a really interesting way to take a home that maybe wasn't Airbnb before and Airbnb is being kicked out of your city or they're making it impossible for the owners.

Or they're just too crowded.

There's too many of them.

Or they're too crowded.

You don't get a top dollar anymore.

Yeah.

Or you just have a nicer, larger home in a good part of town and you're like, hey, I put one family in here and I make 500 bucks a month.

I want to leverage this.

I want to utilize this real estate for something that actually does good and does well.

And now I can do senior housing with it.

And so that's what we show people how to do.

That is amazing.

Yeah.

Right now, I need people to go find you.

Yeah.

Where's the best place for people to go find you?

On social media, we're at RAL Academy, pretty much everywhere.

TikTok, Facebook, Instagram, you name it.

RAL Academy.

Yep.

Residential Assisted Living.

Yeah.

So again, let's talk to me because I'm so interested, but almost like I don't know much.

Okay.

I think a lot of people are going to be like,

the same way I am right now.

Yep.

Can you just go by, I mean, in a general sense,

if you're looking for a single family long-term rental, to some extent, you could just turn that into ARIA or residential living.

Yeah, residential assisted living.

Yeah, yeah.

Yeah.

It doesn't really matter.

You don't have to overthink it.

You don't have to be like, I need to be within this mile of so-and-so.

Like there's no like complicated algorithm of location and distance of things or pricing or like no do we need to so the demographics is just a number one so we really want to be in that area because if it's in the wrong area you're not going to get those rates you won't get the numbers right you won't get the numbers if you're if you're in too high of an area now you're going to be getting really high numbers but your real estate might cost more basically the cost of the real estate is going to kind of

go the same with the cost of care.

Yeah.

So if you're saying, let me use a low-end house in a crappy part of town.

Well, you're going to get low-end, you know, cost of care.

That's what people can afford out there.

Right.

So you want them kind of to be able to match

zone.

Well,

it depends in our nation because obviously like 1.4 in San Jose is a piece of trash.

That's right.

Right.

I was going to say a million here in Miami is not anything is not anything special.

So

here's the thing.

There's four ways to do this.

Okay.

One by land custom build from the ground up.

A lot of our Midwest students do this.

A lot of our Texas students do this.

That's a great way, especially if you can have more than 10 residents.

It's really hard to find a home that you could renovate to really have 16, 16.

Like that's you're doing, you're doing a massive reno anyways.

Yeah.

So custom building is amazing for that.

Buying a single family home and converting, that's another option, what we've been talking about.

Yeah.

Third is buying an existing care home.

So we're very lucky in both of our markets.

You know, there's over 4,000 group homes here in the state of Florida.

There's over 3,000 in Maricopa County alone.

Wow.

Yes.

One zip code where my care home is is the most in the whole U.S.

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I literally, my team just brought to attention two single-family homes in Maricopa.

Yeah.

Like at 450 price range.

Both of them have four bedrooms.

Yeah.

Would that potentially be

could I look at that and say I'm willing to pay retail on that because of the numbers on in DLA.

We pay full price all the time.

Right.

That's what I'm saying.

I'm totally thinking my own real estate business right this second, as I'm talking to you, there is potential to say, okay, I'll pay $4.50 because based around what we're talking about here today,

the math works like this.

And you'll say, Justin, if you look at it like this, that would be a good deal.

We're not like hunting for the best deal.

We're actually just hunting for the best location.

So, pool or no pool?

You know what?

If the pool's off the house, it can be a feature, an amenity.

But if it's like dangerously close where they're just going to go in their wheelchair and plump, nope, not ideal.

Yeah, not ideal.

So, our three homes in Phoenix, we filled one in, turned it into an outdoor grotto.

Another one, um, we drained it and it's an eyesore gate around it.

It's ugly, but that's our lower income house.

And so, it just didn't make sense to upkeep it and we couldn't fill it in.

Cranes couldn't get back there.

And then the third one, it's further off the house and we kept it in eye candy it's been used once in 15 years

but daughter judy as we call the adult child right she walks into the backyard and she goes wow there's a pool mom's gonna love this you know so and never used no um all right so we went through three land uh conversion conversion one that's already built and used as an alf yep and then the last way to do it is you could be on either side of this leasing a home to use for this so if you just want to be on the real estate side you buy and renovate a home and then you lease it to someone who's going to operate this business in your home.

Interesting.

On the opposite side, you're saying, maybe I don't have that real estate experience.

I don't have that capital.

I want to lease from someone and I'm just going to operate the business in their home.

They know what I'm doing and we're kind of in partnership together.

But that's a way that you can just be on the real estate side.

Or if you're like, I don't have any money, but I need to start cash flowing.

you could just be on the business side.

How hard is it to find the operators?

Because I'm now I'm like, okay, well, maybe I don't want to run the business.

Maybe I just want to go do what I know by the asset, find the asset.

But then I would also need the operator.

How is it a hard market to find operators?

It is harder.

There is way more people who are comfortable on the real estate side than there are people who are comfortable on the operations side.

And I'm going to say it's harder to find a good operator.

Because 80%,

like anything, 80% of this industry is currently run mom and pop.

So they live in the home, they work in the home, they do everything themselves.

It's almost all immigrants from other countries who run this industry.

I'm like the minority that I'm like a white girl in this doing this.

There is not a lot of people who look like me doing this.

Yeah.

So that's that's unique.

Are you bilingual?

Puquito.

Tiny, tiny.

Me too.

Yo tempien.

You see, my my nanny speaks Spanish to my son.

So I need to learn so he knows, I know what he knows.

Yeah, that's right.

Funny sidebar, but yeah, same thing.

Nanny speaks to my son.

So he actually knows Spanish more in English right now because he's only 15 months.

Yeah.

My daughter, nothing.

We just raised her talking English.

I'm like, ugh.

But she's only four.

She's got time.

So, man, this is so interesting.

And

who are the type of people that should be looking at something like this?

Like, should everyone?

Is it, you know, you got to kind of understand what you're looking to do?

Is there a sector?

Like, your students, who's your perfect student avatar?

Because if you're here,

you need to find Isabel immediately.

But who is your perfect student avatar?

You know, it's interesting.

We get a lot of people who someone in the partnership or relationship has real estate background and someone has medical background, like you and your wife.

Yep.

And that to me, I always, when, when they come to class, I'm always like, you guys are perfect.

Yeah.

Because one of you understands one side and the other understands the other.

And it's the, you're not going to step on each other's toes.

Yeah.

Because you're involved in very different pieces to it.

That's right.

So I love that partnership, but we've had people as young as 17, as old as 72.

We have people in all 50 states who are doing this, zero real estate background.

We've had kindergarten teachers, truckers, NYPD, I mean, you name it, doing this and now fully, you know, cash flowing and going crazy.

And they've got like one or two homes and they're like, I'm good.

Like, I don't, I'm financially free now.

Even the economics you just gave me were essentially after all costs, you have 60 grand gross between the mortgage, the people, the, the caretakers, the food, the, and you net 10 grand a year.

Yeah.

10 grand a month.

Bro, I mean, I'm sorry, a month.

Yeah.

You have three and you have 30 grand a month coming in.

Yes.

And that's a very, like, that's not a big business.

That's like, no.

You probably could sleep most of the day.

Yes.

And I really share that 10K example because it's very like average and normal.

Yeah.

But most of our students, like I said, are getting way more than that six.

Yeah.

So their numbers are crazy different.

I have students making $20,000, $30,000 and $40,000 a month on one door.

What price point?

Like at $40,000 a month, what price point of real estate are we talking about?

40 grand a month.

So they're paying about 20 in debt service in their mortgage 20 000.

so they're somewhere in the middle like between one to two million depending upon their loan yeah yeah so most of these homes are like in that i would say less than two but right in that that's the right frame if you're one to two pretty much so if you're just talking to me which that's what i'm saying

I need to go buy, find a home, somewhere between one to two million dollars, give or take.

Give or take.

With the right unit mix, unless I wanted to go and remodel it.

Yeah.

You're going to have to remodel it a little bit anyways.

Just for accessibility and stuff of of that nature.

Yeah, it doesn't need to be ADA compliant, but you want it as close to that as possible.

So ramps, guardrails, handrails, but just no home is going to come a 1010.

So like you're going to have to do a little bit of rental anyways.

Okay.

Describe what the house should look like after reno.

Like it should be a certain look or so you actually you want it to feel as much just like a home as you can.

Obviously the excess of bedrooms and bathrooms is a little bit like something weird's going on here.

Right.

But it's, it's so much more it really should just feel like a home how many bed bath unit mix like so let's just say would a four bedroom home be okay or would you want more like what would if you were gonna buy one today in Phoenix yeah what would you be looking for well because my max is 10 I would look for something that is about 4,000 to 6,000 square feet is what I'd be looking for because the floor print and the location is really what I want because I'm going to reno it anyways okay so it doesn't matter if there's already seven bedrooms or three bedrooms I'm good.

I'm looking for the square foot.

Yeah.

You know?

Okay.

So it's that, it's that rule of thumb with a square foot.

And here's the thing.

The state will tell you 100 square feet per resident.

That's sick.

That's they live in a coffin.

Exactly.

Exactly.

That's terrible.

So some of these homes you walk into and they're itty bitty bitty tiny tiny.

So when daughter Judy again comes to their home and then comes to your home and you're abiding by our rule of thumb, which is that 300 to 500, she's like, oh, this is nice.

Like I could see her living here.

It's like, yes, that's what I want to hear.

That's right.

Yep.

Okay.

So, in an ideal world for best profitability, is there a number of bedrooms that gives you kind of the ideal profitability?

Yeah, I would say six is the lowest I would go.

Bedrooms?

Yeah.

Residence.

Residence.

Okay.

Yeah.

I wouldn't, I don't like anything less than six.

And most of your estates allow six or more.

So you really shouldn't.

The only reason people do less than six is because they say, I want to do this unlicensed, which to me is like, shame on you.

Because why?

Like a contractor doing unlicensed.

Correct.

It's like you just don't want to follow rules and the rules are about the senior safety.

So I'm, this is a real estate play, but I'm like very heavy on like the seniors need love and care and respect and safety.

And if you're not going to do that, you should not be in this.

It gives me shivers because the reality is you are taking care of someone's family.

Remember at the highest level at the end of the life where they probably need the most help in their life.

And if you are going to shortcome or take a shortcut.

to doing that and serving people, don't do this business.

Correct.

Just go get a long-term rental.

Who cares?

Let them lease it.

It doesn't matter.

But don't do do the business when you have someone else's family, it like literally in your hands

to take care of them.

Yes, 100%.

A lot of people hear this and they get excited.

Oh, it's money.

And oh, yeah, I could cash flow really well.

The reality is, you guys, you could cash flow well on a lot of types of real estate.

Of course.

There's a million other ways.

This is not one you should get into if it's all about the money, right?

It has to be that equal balance.

And this is impact investing because you are doing something big.

When you asked who's the right person for this, most of the people who come to our training, they have a loved one who's in assisted living who had a bad experience, and they're coming because they either want to get them out and put them in a better home, or they're like, I will never allow that to happen to anyone else in my life.

And so they have like a drawing for the right reasons, right?

It's not just, don't get me wrong, we're all in business, but it's not just about the money.

To your point, you can go get storage facilities that literally doesn't have a human involved.

Correct.

And you can make a God a load of money.

Yeah.

Oh, yeah.

So, okay.

So, 10 people.

Yep.

10 occupants yep do you ever do you always focus on one person one bedroom or will you do two in one bedroom so here's the thing shared is actually harder to fill there's less people who want their mom to share it with

yeah so shared is harder to fill we had a resident or a we had a student who uh was licensed for 16 and they custom built a home out in georgia 13 bedroom 13 bath with the intent that some people will want to share and will have that option they've only ever had 13 residents from like the last five years from day opening to now.

And it's like, yeah, because people don't really love it.

When you're in a low-income area, everyone wants to share, everyone needs to share because they can't afford that.

That's right.

But as the business owner, you're now bringing in less income, but you still have the same expenses.

Your mortgage doesn't change.

Those caregivers, you still have to pay them.

So now you're just making less money.

And, you know, because

the fact that you fill more people.

Yeah.

Okay.

I understand.

So,

one bedroom, one bath, they all need their own.

So bathrooms can be shared.

Okay.

You know, again, it's ideal if they have their own, just gives them the sense of privacy and it's mine.

And, you know, you have to think if you are a senior and you're moving from your whole own physical home to now a shared space.

Right.

and a shared bathroom and a shared bed.

It's like, it's a lot.

Right.

So being able to be like, okay, you have a semblance of independence and this is yours and no one can touch it.

It really is helpful to them.

So, you can have shared bathrooms.

The state will say you can have six people sharing one bathroom.

Again, like terrible.

Don't do that, right?

Is that only Arizona?

Is that just no, we teach nationally.

So, I review all the states' rules.

Okay, some states will say you can have four in a bedroom, two in a bedroom, three in a bedroom.

Like, it just depends on bedrooms, it ranges, but bathrooms, almost all states say six or eight can share a bathroom.

And I'm like, that is terrible.

What's your website again?

RALAcademy.com.

If you want more info, ralacademy.com.

And then Instagram.

Instagram, R-A-L-Academy.

Let's go.

So, all right.

Now,

the uniqueness of this is

inside the walls.

Yeah.

Right.

Let's talk about the business a little bit.

Okay.

Right.

Where do you find the caregivers?

Yeah.

Is there like organizations that you can call and say, hey, I just opened up an ALF.

I need caregiver.

How do we do that?

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So you're hiring them just like you would hire most any other job, Indeed, Craigslist, Facebook Marketplace, like you're just putting kind of the word out there.

You can go to caregiver training schools and kind of get on the list for fresh graduates so that you could be a preferred place that people go.

But it's also a very tight-knit industry and it's a lot of word of mouth.

Most caregivers work at two or three locations of smaller homes or even bigger ones like a Brookdale or a Sunrise.

So a lot of times when you open, you put the ad out there, you get a couple people coming in and then those people tell their friends and it just kind of like is very word of mouth.

But indeed is great.

Yeah.

Yeah.

How do you verify, you know, are they good or the bad?

Like, cause you hear those awful, awful

that are just gut-wrenching, gross.

Yes.

How do you verify?

You know, in any business, you should should be slow to hire and quick to fire, right?

That's like rule of thumb as a business owner, but it's really true in assisted living because these are people's lives at stake, as we've said.

And some of them are literally like, they're, they've lost their mind, right?

Oh, yeah, dementia.

Dementia and all the different things.

Like, it's just unfit.

Like, you need to make sure these people are on it.

Yes.

It's not just someone that's a little bit older.

Yes.

They need help.

Yep.

100%.

You know, I think that there is a big, like, this is not a job where you, you're not going to call the references.

You're going to call the references.

There's no doubt.

That's what I was like, dude.

How many people do you call and sit down with?

Because even I just think of like our families.

And if you think about your mom, like you're going to go above and beyond to make sure

they are taken care of by the right person that actually cares.

Yep.

And I understand to some extent, like if there's 10 people and three caregivers, like it's not like they're getting, but.

They got to care.

Oh, yeah, totally.

So interview process is really serious.

Have you ever done the predictive index?

I have.

Okay.

So I actually make all of my staff do PI.

Yeah.

And I have like certain profiles that I'm looking for.

Yeah.

Especially the patients meter.

I'm looking for patients like off the chart.

Because if you are not, I am like way driving, like not patient at all.

Yeah.

I'd be a terrible caregiver.

Right.

Because to react with these seniors, you have to be okay that you ask a question and the response might come a minute and a half later.

Oh, yeah.

And you can't keep asking and asking.

Like, no, you have to just sit with it.

That is hard for me.

That's that's hard it's hard for me with my daughter yeah oh yes just like kids right

so i know it's it's a lot so i think that we use pi we do a lot of other things we do a working interview so i can see them on the floor see them with other staff we are call all references we i don't do background checks on my residents i do them on my caregivers because i want to know what's going on and also we will kind of like ask around because many of them have worked with each other in other homes like this community is kind of small So everybody does kind of know each other.

And if there's any, any, any, like even the tiniest speck of gray, it's like, it's a no.

I'm really strict about that.

We've got cameras everywhere in, inside and outside of the house.

So I'm watching like everything, you know, and nothing,

if, again, if anything's in question, no.

You're out.

Yeah.

Yeah.

Man, it's just such an interesting model.

So what's the, the,

the burr model to me is very familiar.

Yeah.

Right.

I go into a burr model.

I say, okay, I want to buy the asset.

I want to do the whole burr, renovate it, rent it, refinance, but probably have around a five-year exit.

Yeah.

When you look at a business model like this, do you really go into it with an exit?

Because

you're running a business, like unless you buy the real estate to lease it to the business.

Yeah.

But if you're running both sides of it, do you really kind of go into it and exit?

I feel like this would be like, kind of a forever type of investment to sound.

Having done forever.

So my dad started this industry with me right like we like back when my grandmother fell and needed care we got into it for her with the intent to move her in she passed before we could move her in but we kind of fell in love with the concept so he stopped everything he was doing in real estate investing and went all in on this and that was about 15 years ago um and i joined alongside him maybe 10 years ago when we started training people how to do it because i was like oh i want to help with this I helped a little in the care homes, but I was like, I'm not cut out to care for seniors.

This isn't for me.

so i'd help with other things like activities and decorating and whatever but you know when we got started in this it was his play that hey this is so that it's for my mom it's for any of my siblings it's for you know my mom's parents if they needed it and he's like and it's for me and your mom if we ever need it now my dad passed in 2021 and so he never needed that right but my mom might you know she's like doing red light therapy every day she's going to live forever i love it i love it i think we all are i mean the way way the world's going with health,

you do it right.

People are living longer and longer.

So our plan is that whenever she does need that 20 years, 25 years, okay, great.

She can move right in, live for free.

We're still cash flowing.

And then one day I can pass it to my son and I can do the same thing.

So it can be a generational business.

That's how it ended up being for us when he passed.

It's like, I got left three cash flowing businesses.

That's pretty cool.

Yeah.

So it can pass.

We have other students who their plan is, they're on home number 28 out in Colorado.

Their home's to package 100 up, sell it to the hedge funds.

Are the hedge funds buying it?

They will, if you have that volume.

No kidding.

So now let's talk about that.

That's really interesting.

So there is an exit.

There's an exit.

So the reason why I don't love pad split isn't because I don't like the concept or the economic.

Like I just believe it's new enough that I can't see

where's the exit.

Like who buys a home that has like a sink in 12 bedrooms?

Yeah.

Like who buys that besides someone else that would want a pad split yep which i believe potentially down the road but also i want to know are hedge funds buying hip pad splits and is too early of a concept now alfs and this is not assisted living's not so let's dive into that who is like are they buying how do they buy what are they looking for yes so they would buy but it would probably be 50 doors or more yeah the more you have the better right and having them all under a brand like that is also

they want the brand of it yeah so that's also important so that's exactly what our students are doing they're like hey we're gonna like brand this and that they're doing an incredible

28 28 and they want to get to 50 and see if the hedge funds will buy 50 but really their goal is 100.

yeah because why slow down i mean yeah their goal is 100 so talk to talk about them okay they started in they came to our training in 2017

and um he was of they were both flippers and that's that's all they did was just flipping and um they came and they totally jumped in on the concept went through our mentorship and coaching So we've been working with them, opened their first home, and then just scaled, scaled, scaled.

And really, what they focused on was systems.

Because currently, if people hearing me say this who are in the industry might be like, there is no way you could do that.

And it's because they built themselves a job.

Right.

They did not systemize it.

They did not set it out like, no, how do you want it year five?

Build it that way day one.

Even if you take a little bit less money, it is worth it.

Like, pay for speed, pay for someone else to do all these day-to-day jobs, whether that's VAs or whatever it is.

we really help people build systems so that they can become hands-off.

So it is possible, I mean, they wouldn't be able to do 28 if they didn't have that, but the more you have, the more levels that you're getting.

Now it becomes even more systems in place.

So in one care home, you're the owner in the owner's box, right?

And then you have a licensed administrator, which is kind of like your PM in the real estate world.

They're hiring your licensed caregivers.

That's it.

Three levels, right?

Owner, admin, caregivers.

Okay.

Now, when you have more homes, let's say three homes, you might have someone on top of all of them being like the executive director who's overseeing all three.

And you have each one with an administrator and then caregivers and so on.

Now you've got 10 homes.

You might have another level where it's like, okay, we have an activities director who's overseeing all of these and coordinating, you know, all of these systems for us.

So it just becomes more and more levels, similar to corporate, right?

And that's how you can really help systemize it.

And again, keep yourself out of the weeds is you're hiring someone else to do this job at a mass scale.

And so you can scale and grow like that.

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And I'm like, oh.

So, all right.

I have so many questions.

So

I will say this.

If you just wanted to sell one, if you just had one and you wanted to sell it, just so you know, numbers wise,

it's the transaction looks like this.

It has to be a commercial broker.

So it's the real estate is the one sale.

The real estate's worth whatever it's worth.

Right.

And then the business is two to five times the EBITDA.

Okay.

So obviously if I'm selling, I want it five times.

If I'm buying, I want it two times.

It's worth what someone's willing to pay.

We usually see that three to four multiple.

So you can sell these and we help people buy and sell them.

I mean, you, you know, got a deal that we were talking about earlier.

We help people.

How about this?

One of your students.

It might have been.

I almost, I mean, I don't even know who it was.

I got attacked.

Hey, I know you're in Miami.

They know me.

Yeah.

They're in my phone.

Or I don't save them, but they're like, hey, I know you're in Miami.

Yeah.

Are you interested in ALF?

You never know.

So, so we help people buy and sell them all the time.

But I really think that the exit plan, if you're going to scale this correctly, could be that large buyout, something like that to a hedge fund.

Or if you're saying, like, hey, I want three of these, I want to hold them until my mom or I need care.

And then I want to package them and sell them.

Somebody will still buy a three pack, a five pack, a 10 pack, but it'll probably be someone like me or my students who's like a smaller level person, not a big fund.

So someone like me who

Like all I would have to actually do is the two things that invest that find the real estate and raise the the capital

i then go find someone to fill the seats of the caregivers and whatever yep give up some more money on the front end to pay the people the right people yep so then i can go do more real estate and more capital exactly that's what i want to keep you in your box right and i just rinse and repeat find the capital find the real estate find the capital find and i overpay Suzanne, who has 15 years of doing this to go find the caregivers.

Yep.

And I'm happy to do that on the first couple because then I can get to five or 10.

Exactly.

And then you can have a big salary.

And so have a real business.

Yeah.

I mean, it is a full-blown business.

You know, I was just in New Orleans just like two days ago with one of our students and he's just turned 30.

He's got two care homes in Wisconsin.

One's cash flowing him $19,000 a month.

The other one, $21,000 a month.

And he was a travel nurse before he did this, zero real estate background.

He heard me on bigger pockets and he was like, okay, I got to do this.

Right.

And I feel like, like, I'm like, when are you getting your other one?

He's like, why?

I'm good.

Like, well, 50 grand a month for most people is

at this point you go,

he's like, I'm 30.

Like, I'm happy.

I'm fine.

He's like, I'm actually going to go move to New York City and just salsa dance and have fun and, you know, mess around.

I'm like, okay, cool.

Good for you.

So everyone comes in with different game plans.

Other people think huge.

Some people are like, let me just cash flow and so I can chill and live my life, you know?

And other people, they want something that they can be involved in and a business they can be active in.

And that's the cool thing about this industry is it can be whatever you want it to be.

It could be a couple of assets that cash flow you well that you don't have to really attend to very often.

I would say I visit my homes once a quarter.

So out of your real work life.

Yeah.

How many hours a week or a month do you think you actually genuinely are focusing on those assets?

Five hours.

A week or a month?

A week.

Yeah.

It's like a weekly meeting with my manager.

So my, my PM,

and

then I like to do like, look at payroll and stuff like that and social.

Yeah.

But almost everything else is dedicated to teaching other people how to do this.

The thing I think is so important for most people to hear from what we're talking about, there's no one size fits all.

You don't need to build a business like mine or like yours at scale.

You don't need to go one or two and stop.

Like there's no one size.

You have to understand what you actually want from it.

Yes.

So what I always will tell people is figure out what you like.

I have the five pillars of success.

The first pillar is decide what you want and who you need to be to get it so in the example that you just gave with your student he's like i want some financial freedom i don't need to be donald trump right i don't need to have a whole empire he goes and buys two he makes 50 grand a month yep literally that is lifelong income that will pay for probably anything he wants for the rest of his life yep he may not be extreme about his spending but 50 grand a month is 50 grand a month But that may not work for someone like me.

I might go like, okay, I need two a week to buy.

Like, I can't.

Exactly.

Right.

But there's no one size fits all.

There's no one size fits all.

And that's what I love too is when people come, we get to kind of be like, what's your vision?

What do you want?

And some people, it's genuinely, it's one home for my mom.

That's all I care about.

And it's like, great.

Other people, it's financial freedom.

It's a couple of homes.

So I don't have to work anymore.

Other people, it's.

I want to take over this industry and I want the biggest cash out you've ever seen.

And it's like, okay, cool.

Like you can do whatever you want.

Have we seen, or we by you,

have you seen an actual exit with a hedge fund yet?

I have.

I've seen someone in who in Texas, they had 400 doors.

I don't know what multiple in this space.

Yeah.

Sheesh.

I don't know what multiple they got, but I know that they're sitting pretty.

Oh, yeah.

I don't think they're working very hard right now.

Now, your students who do have 28, what state are they in?

Colorado.

Wow.

Okay.

Is that a.

It's actually kind of a tougher state for this.

I would have thought.

Red states are better than blue states when it cuts to real estate investing, and especially this, because it's business, it's small business.

Yeah.

So Colorado is not the most friendly to this.

But I will say this, some people who are watching are probably thinking, well, can't they deny this in a neighborhood?

Can't they say, you can't do this?

An HOA, a city, a state, an angry neighbor can't say no because we are a federally protected class.

The seniors are considered disabled by the time they're moving in.

And so under the Federal Fair Housing Act, we're protected.

So no one can deny you.

Now, that doesn't mean they won't try.

Right.

So in Colorado, they are all about trying to deny right so almost every house they've gone after it has been a battle but uh we actually created the first and only national association that represents all 30 000 group homeowners across the country so we have legal backing and power there so they've just partnered with them got their lawyers involved and basically won every single case.

So it does not matter what neighborhood you live in.

I could go do this to my own personal home and move tomorrow back to Scottsdale.

They can't stop me.

They can't stop you.

They might fight you.

Like I said, you might have a fight, but they can't stop you.

That is because a neighborhood can't fight a federal law.

Well, I, because so you're obviously in Phoenix.

And so I just moved here from Phoenix 2021.

So me and my wife are literally like, oh, you know, I have so much, I'm leaving to Phoenix tomorrow.

I go to Phoenix all the time.

Like, should we probably move back to Phoenix?

Our home would rent for about nine grand a month, just normal.

Yeah, here in Miami.

Just normal rent.

Yep.

And now I'm hearing your numbers and I'm like,

do we turn this into a

60 grand?

Maybe.

What's the well?

3,000 square feet, five bedroom.

Okay.

About a 2 million valuation.

Okay.

And

the neighborhood area, affluent?

Super.

Okay, great.

This is good.

So, yeah, you could probably do, even if it's licensed, you have to probably change the because it's a U-shape.

My light.

Five bedrooms.

I don't know.

What you don't want is long hallways because that's reminiscent of a big big box.

Right.

Yeah, sure.

You want it to feel like a home.

Like, you know, I mean, it's very homey.

Yeah.

Anyways, it just makes me think like, wow, okay.

I could, I, you know, it's funny because if I even think about what I'm buying right now and raising capital for and the returns and I'm like, God, this would make sense just for the long-term exit, even if I didn't have a big term exit to the hedge funds.

Yeah.

You have all this real estate for 15 years and it's running at such a high income.

That's, that's the beautiful thing is so many people are like, well, let me just hold this and make 200 bucks a month on something and I'm just going to hold it and one day I'll cash out bigger.

One day I'll pass it to my kids.

Why one day?

Cash flow now and have the big cash out.

And do you like even do your students work typically and do this part-time or do they typically more full-time doing this?

It ranges the gambit.

But I mean, we've had people who literally work on Wall Street who've opened their care homes.

Well, that's the point is if you didn't like that guy or me, for example, I might not need the income in terms of the cash flow.

Right.

But could I just go pay down whatever debt I have on that home?

And then when I do want to exit in 10 or 15 years, I have a free and clear $2 million asset, but I have 10 of them.

Yep.

That's $20 million in the next 10 years.

Because I just paid down the asset.

I didn't have any loans on them.

I exit them all.

Yep.

That could be a beautiful way to.

I mean, there's just different, that's what I'm saying.

There's no one size fits all of this.

You can kind of work this.

No.

Some people like get into it like that.

They say, hey, I've got, I've got homes I want to pay off for this or that.

And so they kind of want to use it to do that.

Other people say, you know, we get a lot of people who actually come and they say, oh, I have a heart for seniors.

I actually want to open a low-income home for seniors.

But what I teach is pretty much private pay and more high-end.

So they're like, it doesn't really fit.

And I'm like, no, it does fit.

Open the high-end home.

Use this capital to go open a low-end home.

Serve those seniors.

Don't let them not pay anything to live in the home.

Like just accept whatever from the government.

Okay, great.

Now you can serve both, but there's a there's a method to the madness.

So I have to open the high-end one first to make the low-income.

I would be able to have the money to go do that.

Always.

It's good to be altruistic, but you got to be able to afford the altruism.

Yes.

Right.

Yes.

So there's so many ways.

This is so fun.

So guys, again, make sure you are finding Isabel everywhere.

Yes.

Right now, by the way, don't wait.

Find her all over Instagram, your website.

You guys need to learn.

If you're interested, I'm telling you, I'm sitting here.

I'm basically using this in my own little coaching session right now.

This is amazing.

Yeah, thank you.

So get with Isabelle.

It's been a pleasure having you.

Thanks for having me.

Thank you for coming all the way out.

Again, what is the website?

RALAcademy.com.

RALAcademy.com, all over Instagram.

Go to the website.

If you thought this was pretty interesting and you know some people that need to know Isabelle, not just yourself,

share this with two of your friends.

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