Financial Freedom with Real Estate Investing MB 198: The Calculated Courage to Do Your First Deal – With Craig Schumacher, MAI
Is fear stopping you from doing your first multifamily real estate deal? If you’re not the type of person to simply jump ship from the relative safety (and health insurance) that comes with a W-2 job, but you know you can’t spend the rest of your life on the hamster wheel, then NOW is the time to activate what Craig Schumacher, MAI, calls ‘calculated courage.’
Craig Schumacher, MAI is the Managing Member at IRV Capital LLC, a real estate investment firm that focuses on multifamily and student apartments. Craig spent 25 years working as a commercial appraiser and valuation specialist. Four years ago, he decided to stop helping other people make a fortune in real estate and build a portfolio of his own. Craig closed on his first syndication deal in January, bringing him to a total of 89-units (with another 28 under contract).
On this episode of Apartment Building Investing, Craig joins me to explain how he recently quit his job as an appraiser to pursue multifamily investing full time. He describes the AHA moment that inspired him to take action in 2016 and walks us through the key lessons learned from his difficult first deal. Listen in to understand what Craig would tell his younger self about getting started in real estate investing and learn what he is doing now to scale his multifamily portfolio!
Key TakeawaysCraig’s transition from appraising real estate to investing
- Biggest hurdle = solving health insurance issue
- Took time to enact plan but never been happier
What inspired Craig to make a change
- Shocking self-assessment at age 45
- Not in position to put kids through college + retire
How Craig got started with real estate investing
- Bought 5 condos + 2 duplexes (university housing)
- Gain experience as landlord, bank relationships
Craig’s rocky transition to multifamily
- Sold university rental portfolio to buy 28-unit
- $20K out of pocket for foundation issues
- Challenges around self-managing property
Craig’s key lessons learned from his first deal
- Deeper level of due diligence re: leak disclaimer
- Include nearby complexes in evaluation
Craig’s highly successful second multifamily deal
- 29 units next to Illinois State University
- Convert to student housing ($17K to $25K/month)
- Cash-out refi to return 100% of investor cash
Why sellers and brokers took Craig seriously
- Some credibility from SFH portfolio
- Decades of experience as appraiser
What Craig would do differently in retrospect
- Push past fear to take big shot sooner
- Cultivate ‘calculated courage’
How Craig made time for multifamily
- Dedicate every free moment to investing
- 14-hour days for 4 years, supportive spouse
How Craig overcame his fears around raising capital
- Start with friends, family and friends of friends
- Gets easier every time as share enthusiasm
Craig’s plan for scaling his multifamily portfolio
- Expand network via podcasts, conferences
- Build platform by sharing content online
Craig’s advice for aspiring multifamily investors
- Partner with experienced investor
- Add action to make ideas real
Connect with Craig Schumacher, MAI Resources
Rich Dad Poor Dad by Robert T. Kiyosaki
Real Estate Guys Create Your Future Goal Setting Retreat
What’s the Best Investment: The Stock Market or Real Estate?