GI178: Investing in US Real Estate While Living Overseas with Becca Hintergardt

GI178 Investing in US Real Estate While Living Overseas with Becca Hintergardt

Becca Hintergardt began her career in real estate by house hacking a duplex in San Francisco, and then purchased a 12-unit apartment complex and now she is an investor in over 500 units and lives with her family in Costa Rica.

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Announcer:
Welcome to the Global Investor Podcast, a show that focuses on helping foreign investors enter the lucrative US real estate market. Host Charles Carillo combines decades of real estate investing experience with a professional background in international banking to interview experts in all areas of US real estate investing. Now, here’s your host, Charles Carillo.

Charles:
Do you have money sitting in the stock market? And you’re worried about it or worse. You have money sitting at the bank, not keeping up with inflation. My name is Charles Carillo, founder and managing partner of Harborside Partners. And since 2006, I’ve been investing my money and my family’s money into income producing properties. These are real assets, real properties with real addresses that produce real cash flow. At Harborside Partners, we provide passive investors who love real estate with a turnkey investing solution. If you want to put your money to work in real estate, but can’t find deals, don’t have the time to get funding in. The last thing that productive people want to do is manage real estate. We find the deals. We fund the deals and we manage the tenants, the termites and the properties. Partner with us at investwithharborside.com. That’s investwithharborside.com. Go to investwithharborside.com. If you love real estate, you like the idea of passive income and believe that income producing properties will appreciate over time. Go to investwithharborside.com. That’s investwithharborside.com.

New Speaker:
Welcome to another episode of the Global Investors Podcast; I’m your host Charles Carillo. Today we have Becca Hint (Hintergardt). She began her career in real estate by house hacking a duplex in San Francisco, and then purchased a 12-unit apartment complex and now she is an investor in over 500 units and lives with her family in Costa Rica. So thank you so much for being on the show, Becca.

Becca:
My pleasure, Charles. Thank you for having me.

Charles:
So give us a little bit of your background, both, uh, personally and professionally prior to getting involved in real estate investing.

Becca:
Oh, you bet. Well, I’m from the Bay Area and my husband and I were in, uh, medical device sales for the last, oh, 20 years or so. Uh, we would sell those large machines, the CT and MRI scanners. So great jobs, you know, big paychecks, big income, big territory. Um, and, uh, it was, uh, I realized pretty early on the more money I made, the more taxes I would pay <laugh>.

Charles:
So especially in California,

Becca:
Especially in California, it was a tax massacre. So, uh, <laugh> pretty early on, I said, oh my gosh, I, I better get myself a tax deduction and a place to live first, those two. Um, and I was single at the time, so I bought this duplex in San Francisco and I lived in, uh, the upper unit and renovated the downstairs unit and then flip flopped. It was only myself and a contractor that bid on it, so that was just not a good idea. I just thought my parents said, this is gonna end really poorly, but <laugh>, it worked out. Um, it was a major lift of a, a project and, um, I, I had to, uh, prop up the building and put a garage underneath and, um, you know, you get to charge another $500 in rent in San Francisco for that. So, um, did massive, massive renovation, structural things. I mean, so much for a first property. Uh, it was great. Glad I did it. I’d never do it again. But what it provided me was the insight into passive income, and I was realizing I’m getting mailbox money. I’m getting a huge tax deduction. I need more of these. Mm-hmm. <affirmative>. So my love for passive income began then, uh, when I had that property and I was still in my medical device job. So then it became how can I transition more into real estate and get more mailbox money.

Charles:
Oh, that’s great. So when you were starting out in real estate afterwards, where did you transition? Uh, you weren’t obviously doing other house hack, but you went into, uh, commercial multi-family. Is that correct?

Becca:
Well, you know, I, um, I started, I thought, okay, I, I gotta scale this a little bit and I need to go outside of California because things are so expensive in California. So I did two things. One, I started investing passively. I invested into 149 unit in Longview, Texas, which was a great experience. And actually it didn’t go that well. Uh, that’s why it was a good experience. I learned a lot. But it’s good to be on the sidelines and watch what other people do and what they do wrong. Um, and then meanwhile, I bought a 12 unit in Kansas City, was sort of a, you know, these deals. It was one block away from a good area. The path of progress was heading that way, but one block. So it was a bit of a speculation play. Uh, lesson learned though that path of progress needs to happen within your whole time.

Becca:
It happened, but it <laugh> it happened 10 years later. Um, and I only held it for three. But, um, you know, uh, lots learned there. I call that kind of my training ground. And, uh, um, the big takeaway there was that unit size just wasn’t large enough to sustain a steady cash flow. Because if you had one tenant or two tenants even that move out, it’s blown your cash flow for six months. It was good, while it was good and everybody was there and it was occupied and it was underwritten for, you know, 10% vacancy. But once it dipped below that, I was in a negative cashflow position and I realized I just wasn’t large enough. I, I needed to scale and I needed to find an, um, uh, efficiencies, economies of scale, which I had determined. It happens at about a 50 units and up.

Becca:
Um, the one good thing about that deal though is, uh, I used to be in the re mentor program many years ago that Dave Lenal, I’ve since been more in the Michael Blanc group, but I’d like to be in these mentor groups just to have other minds around me. And, uh, that RA mentor group, I mean, 15 years ago they were preaching emerging markets, and they’re absolutely right. And this is what saved me. As long as you are investing in a rising tide, all boats rise in a rising tide and you can make a lot of mistakes and still make money. Yeah. So on that Kansas City deal with all of my mistakes, like I could write a whole book on everything done wrong there, but still I came out, um, selling that building 20% over what I bought it for only three years later. And absolutely not because of my brilliance, just because of a rising market. So from there I said, okay, I’m gonna take a snippet of this and make sure I’m investing in markets that have, um, an increase in population, diversity of income and, uh, that I can buy at a good unit cost and all the other, um, metrics work out in that. Interesting. And it wasn’t San Francisco anymore, of course, <laugh>.

Charles:
Uh, that’s great. Yeah. When you’re in an area where you have job growth, population growth, decreasing crime, so you’re in a growing area, you have the ability of, uh, not being completely perfect with your estimates, and that gives you the buffer, like you said, it’s very, very pouring. Cause if you’re going into an area that’s just cash flowing or you see a steady population or even a decline, you have to be very careful with what you’re doing. And you really have to get either really steal the property because there will be things that pop up and there will be, and you’re not gonna be able to, if you’re $50 off on your rent targets mm-hmm. <affirmative> in a growing area, maybe it’s another year and you can get those in a stagnant area, it’s gonna take you and that’s gonna push out that. So that’s, that’s, that’s awesome. Great, great information there. Uh, so tell us about kind of your journey from medical sales. You’ve already started investing and now becoming a full-time real estate investor, which I feel most people that want be active in real estate, that’s kind of their, their goal.

Becca:
You bet. Well, uh, I guess as a traveler, I just have a sense of wander lust anyway. So it was imperative for me to figure out something that I could have a location, independence and, um, that I wasn’t committed to a W2 job going into the office every day. And for e every road pointed to real estate in that for me. Uh, so what I did is I continued to invest passively to watch how other operators, uh, manage their assets, learned a lot along the way, and then began to, uh, run my own deals in active. And I straddled both active and passive investing, a big passive investor, um, you know, probably, you know, 60% passive in, um, of my holdings. Um, but you know, Charles, the main goal became how could I live overseas? I was a, I was a backpacker in college all through Europe, and then I spent six months traveling around the world, going to see China before it became part of communist, uh, or going to see Hong Kong before it became part of communist China. Did the Mongolian, uh, merchant train through Mongolia and Russia, and it’s just an intrinsic need to travel. So I said, how can I still make money and, and pursue my love of travel? Um, and then real estate, as I said, became the way and it ended up where we are now, which is Costa Rica.

Charles:
That’s awesome. That’s fantastic. And how long have you guys been down in Costa Rica, you and your family?

Becca:
I hope you just heard the Haller Monkey there, <laugh>, cuz that wasn’t me growling at you, but, uh, <laugh>, uh, we’ve been in Costa Rica since August, so my husband and I, um, during the pandemic things just became so difficult in California. We decided to pick up our two kids, um, uh, age, uh, 11 and 12 and rented out our house, stitched together all our passive income and, and moved last August. And we moved to, um, we’re in Noosa Costa Rica, which is on the Pacific side. And it’s, um, it’s one of the blue zones of the world. I don’t know if you’re, are you familiar with those

Charles:
At all? Yeah, there’s a few of ’em. Uh, Japan, Sarnia, Italy, there’s a few other, my brother’s been pushing me to buy a house in Sar, Italy for years, and he’s pushing this blue zone. So I I’ve I’ve looked into it. Yeah. So

Becca:
Oh, you should, you should. They’re amazing places. But for your listeners that don’t know about it, they’re essentially, there’s about six of them in the world. Ums Sardinia is one of them. Um, uh, Costa Rica, GU Costa Province where I am, Okinawa, Japan. And these are places where people live to, um, a very, um, old age. So there’s the highest concentration of centenarians and it’s because of their lifestyle and they, uh, the things they eat, the things they do. So it’s a very health and wellness. We’re in a boutique surf and yoga hub here, so it’s been a huge life upgrade for our family and our children. Uh, they attend an international baccalaureate school in between the jungle and the sea and surf several times a week. So it’s, it’s been amazing. And real estate has been the way to do this. I could have never done this in my med device job.

Charles:
Wow. Yeah. Every time I talk to people on med device, they say it pays really well, but the day they start, they are looking to the day that they can quit. So I don’t know how true that is. Yeah. But,

Becca:
Oh yeah, that’s very true. <laugh>.

Charles:
So tell us about right now, um, you’re 60% passive, 40% active and getting into one of these active deals in the second boat. Kind of give us an idea of what your current investment strategy is like, what are you looking to invest in both actively and what are you looking at, uh, when you’re passively investing? Like what are you, where are you right now with that?

Becca:
You bet. Actively we’re, uh, actively and passively, I’m multi-family and my model is a cog P model. So I am in contact with lots of sponsors and uh, we bring our money into their deal and we’re side by side as as a general partner. They are boots on the ground. Um, we look for growth markets, Arizona, um, Texas. We love Texas. We’re looking more into the southeast now. We like Florida, we like, um, Georgia. And um, we look for light value ads. We’re looking at B and A and B properties now we’ve moved a bit away from the C so that’s essentially 1980s and up. Um, light value a deals in emerging markets. Interesting. And we’d like to be out in about the three to five year timeline.

Charles:
May I ask why you’re, uh, avoiding C class? Cause it’s something that we’ve been doing here over the last year, two years.

Becca:
Yeah. Yes, I know. Uh, and we were in C class for quite a while and, and we still kind of dabble in them. We look at ’em, but the feedback from other investors that we have found, and even our experience is they look really good on paper. But as I experience with my Kansas City building, the management of this class of, um, tenants is, is very labor intensive. It wears out the property manager, it exhausts us. You have move outs in the middle of the night. Um, and it’s just very labor intensive and with cap rates so compressed mm-hmm. <affirmative> that we’re finding, we might as well be investing in B properties. Also, there’s less, um, uh, repairs cuz the buildings are, are uh, you know, not sixties and seventies, they’re eighties. But saying that these deals are hard to find, there’s way more C-class buildings and in looking for value ads, there’s, there’s greater value adds and Cs. But we are finding some good a class deals actually more like a minus properties that were bought from the builder and they just filled up the units with, you know, anybody they could just to sell it off. Cuz they’re not in the leasing and property management business. So we’ve been able to find, you know, a hundred, $200 rent bumps in some of these A class buildings. The downside is, is they’re pretty expensive to buy. So this is a team sport as you know, so it just requires a bigger team to take these down. Um,

Charles:
But you might have there at that point you might have might more investors larger, more professional, uh, outfits that you’re selling it to. That’s where you’re really getting an institutional buyer with those nicer properties as I found.

Becca:
Yes, agreed. Agreed. And I’m also finding, just on the investor side, my investors prefer to see buildings like this. They kind of look at c class buildings go, oh well, you know, it’s not so pretty. Yeah. Um, so, uh, but you know, saying that we still do dabble in cs, but most of our focus is a’s and B’S value add emerging markets multi-family.

Charles:
Yeah. Yeah. I find that the B class range is like one of the biggest ones because a B minus is gonna differ greatly from a b plus. And you’re an A and you’re like, well there’s not much difference between like an A and a <laugh>. It’s granite, you got granite everywhere, marvel, whatever. I mean, it’s, it’s beautiful. What do you want me to say? Uh, so he doesn’t have a big enough swimming pool for your, your Olympic laps, but, um, so talk about, uh, this is really interesting. You’re converting a motel that’s 65 apartments and I guess it was a did you was a comfort or days in, I don’t remember when I was doing research for this, but it’s in Phoenix and um, it’s an interesting topic that we don’t talk about much here. So explain this deal to us and, uh, how you got involved with it and everything.

Becca:
Oh, you bet. These are fun, fun deals. Uh, these are hotel to multifamily conversions for your audience in case they haven’t heard about ’em. But these are a lot of fun. And they’re deep value add, I mean heavy, heavy lifts. So, uh, buckle up, put on your patient’s cap <laugh>, it’s a long road <laugh>, but it pays off in the end because you can get these deals at just a fraction of the price. Um, we got this, um, at 30 cents on the dollar, so a 70% discount. It’s a hundred unit quality in motel that we’re taking down to 65 units of multifamily. So 31 1 bedrooms, uh, 31 studios, and then the remainder two bedrooms cuz they were suites.

Charles:
Nice. And tell us about kind of, so when I’ve, when I’ve ever I’ve spoken about this or spoken to contractors about it or other partners about it, the first pushback I get from contractors that have actually looked into these or done it is electrical and Oh yeah. So what can you tell us about issues you’ve experienced? Cause I mean, even if I’m renovating a C class with D class, electrical’s not gonna be a major thing unless it’s like, you know, a hundred year old property and I’ve got like knob and two. But it’s something that’s built in the last 40 years. Electrical’s really not a huge thing. Maybe it needs an upgrade on the service, but I’m usually not having to run lines on a property like this or kind of redoing the whole thing. So what issues have you experienced with this conversion that you did not expect or that you’re normally issues that you don’t see when you’re renovating a typical apartment complex value app

Becca:
Style? You bet there’s a ton of ’em. And actually electrical is isn’t even a big one in comparison to all the other problems you can have. But, uh, <laugh> mostly with hotels, you wanna think fire. So, um, counterintuitively, many hotels don’t have fire sprinklers, uh, because there’s no kitchens. So when the city comes in, the first thing they’re gonna say is, you’re gonna put kitchens in here, you need a new fire hydrant to enable a dedicated line for the fire sprinklers gonna put all throughout the building. The cost to us was about $200,000 for the fire sprinklers alone. Also, the Sheetrock, because of fire sheet rock in, in, in motels aren’t as thick as Sheetrock in apartment buildings. Maybe that’s why they’re always so noisy. Um, but <laugh>, you need to often redo all the sheetrock because it has to be fire safe. Um, then back on the fire theme, you have your windows, you have to have egress on your, your windows.

Becca:
So if you have a second story hotel, then like we did, you have these floor to ceiling windows that are beautiful, but you can’t get out of ’em because hotels think of suicide risk for windows, they don’t think fire egress. So we’ve had to take out these huge windows, reframe ’em into smaller windows that can open for egress. So big things on the fire side of it. Uh, yes, electricals sometimes an issue. It depends on the building and the age. Um, so that’s another one. Um, doors are actually kind of fun too. You end up with all of these, uh, funny doors, you know, because we took out, uh, we’re going from a hundred to 65 units, so we had these really thick security doors that, you know, you can’t even kick ’em down like you have in hotel rooms. So you end up with like, we have a whole graveyard of doors, it’s a merry-go-round of doors.

Becca:
Where are we gonna put these? Should we put ’em in the bathroom door? Should we put ’em on the bedroom door? But, um, so those are are kind of fun. But yeah, lots and lots of things in renovation, including electrical fire’s a big theme. But before you’d even go into that, Charles, you’d go into the three things to consider that even if you even wanted to even do this. And it must start with zoning. Um, in hotels you need separate zoning. Usually in our case, we’re in a tertiary market of Arizona, so we had an over the counter permit, just a change of use for zoning. But in larger markets, we have a friend in, in Arizona in a much larger market there that the city said, okay, we’ll rezone you from a multifamily to a hotel, but with strings attached, you need to put in two fire hydrants and repave the road to the tune of half a million dollars. So it’s important to underwrite and he underwrote for that. And um, it was still a shocking number, but uh, that’s something that you, you must start with that otherwise you’ll be in the hotel business and that’s what they’re trying to get out of. Right. Um, also, um, things to consider is the franchise cost. You’ll need to buy yourself out of that quality and franchise or whatever franchise brand you’re buying that can range anywhere from $35,000 to, you know, $250,000 and potentially more depending how big the brand is.

Charles:
Interesting. Yeah. Whatever that flag is, you’re gonna have to pay for it. I’ve heard all different types of, uh, fees like that because of, uh, depending on, uh, what I’ve seen is different, let’s say different levels of the hotels, right. Different flags that they have. Some of the more expensive, more luxurious ones might make it a little harder for you mm-hmm. <affirmative> compared to the, you know, comforting that you’re working with. Um, so that’s, that’s, that’s quite interesting. How long have you been working on that and uh, like how long do you think the whole process will take?

Becca:
We are, um, we’re about 18 months in now mm-hmm. <affirmative>, and we’re just getting the occupancy permits for phase one. And this is another wacky thing when you deal with the city, you know, they say one thing and, and then they do another <laugh> and large projects. You just need to brace yourself for that. So we got our, um, we, we did phase one, we had all the floors and paints just put in a couple weeks ago applied for occupancy and they said, Hey, this is great. We love it, you guys, we’ll give you occupancy for phase one, but you know what, we want you to do all the fire stuff in phase two. And we said, well, but we’re not opening that side of the building. Why do we need to do that? And they said, well, we don’t know, we just changed our mind. So go ahead and do that and we’ll be back <laugh>, we’re just finishing up a phase two fire so we can open phase one.

Becca:
Um, but yeah, they’re, they’re heavy lifts. This project in particular is a legacy deal, which is a lot of fun. It’s true mailbox money in the end. And this is structured that, um, at about the, yeah, about two and a half year mark, we’ll do a refi and give investors a large chunk of their money back. And then at about the five and a half year mark, they’ll get the remainder of the money back. And then we hold the property for 10 years, just mailbox money, infinite return for the investors. And, and I love this because it’s, it’s true mailbox money in that sense that I don’t want to be always looking for deals and essentially flipping multi-family buildings for the rest of my life. I’m looking for a longer term cash flow play to subsidize my life overseas. So we, we love that. And all the while getting, um, you know, tax deductions and cash flow, and you can do this with hotels because you’re buying so inexpensively, typical syndications in multifamily, it’s much harder to do a 10 legacy play like this because there’s just not enough meat on the bone to do this.

Becca:
Investors need their money back. And, uh, then once you do that, there’s, you know, often not enough money to support the deal later on after afi and then even a second refi, you can’t really do that. But if you buy something for 30 cents on the dollar, you can sure do that.

Charles:
It seems, uh, sounds more like a, more like a new construction, new development type, passive investor mindset you need to have Yeah. Where you’re not getting a dollar for two and a half, three years. And then after that, then we can refinance out and probably multistage how you’re doing it and really get the thing rented and are we selling it or are we refinancing, which will really matter to I guess how long we’re holding it by where the market is at that point too. Yes. You know, the whole thing. So,

Becca:
Um, you got it right and your investors need to be prepared for that too. Mm-hmm. <affirmative> that everybody knows this isn’t, uh, uh, cash flow play from day one. It’s not even a cash flow play from day, you know, month 18 mm-hmm. <affirmative>, it’s a a bit farther out and they know that, but they know that there’s a, a, you know, a bigger chunk on the back end. Yeah.

Charles:
There’s a lot of value. Yeah. Mm-hmm. <affirmative> and it was easier. Everybody else would be doing it and getting into something like this. I mean, uh, it it seems like, like quite, quite the, uh, undertaking, but, um, interesting. Very interesting. So tell us about, I kind of like your, you’re living in Costa Rica, which is great. I mean, how do you operate your business remotely? Obviously you have partners, as you mentioned that are, uh, boots on the ground mm-hmm. <affirmative> now, do you have assistance that you work with for working on your part of the business or any employees that are underneath you? Or how does that work? How are you structured?

Becca:
Uh, it’s my partners and I am structured on a cog P model. Mm-hmm. <affirmative> and, um, apologize, the little prop planes going over here in the jungle. It’s like Jurassic Park. It’s the one plane a day. Oh yeah. So it’s a cog model and I partner with experienced operators. Uh, it’s my team and I, so, uh, we have our underwriter and we have our, um, um, I’m more like investors relations that I’m finding the deals, finding the partners as well. And then just for my, my basic business, I have VAs that help me with just administrative type of things, but it, it, um, it certainly can be done overseas without any problem. I mean, realistically, we hadn’t left our house in the last two years Yeah. Back in the Bay Area. So that just <laugh> that proved it right there for us. And that was one, one of the impetus of this.

Becca:
I said, honey, we should just take this game overseas because, uh, I said, Hey, do you know how much this house cost in the Bay area per day? And look how much we could rent it out for Airbnb per day, and then look how much we could live in Costa Rica per day, and we could live off that delta in addition to stitching together other investments of ours like our San Francisco building and these passive building passive deals and, you know, a bunch of other things. We just stitched together and said we could do this business completely overseas and, uh, live a much more tranquil life than the madness of the Bay Area during the pandemic.

Charles:
So how difficult was it for you and your family to relocate to Costa Rica in, in your business as well? And what kind of problems, uh, have you faced during this process? I guess, because I imagine there’s other people too that would love to kind of mimic what you guys are doing.

Becca:
Oh, yeah. Well, it’s, it starts with really, um, you know, getting rid of things is where we had to begin. <laugh>. I think most Americans have this problem. Yes, we were, uh, we were on the quest for minimalism actually quite a bit before this, but we were surprised at still how much we had. So it took about six months to just get rid of things on Craig’s list on next door, putting it out on the curb for free. Uh, then we, we said, okay, do we wanna, you know, rent a storage shed or, um, and those get pretty expensive and I thought maybe we should invest in a storage unit actually, but <laugh> a storage center, but, uh, seeing the multifamily and storage business we’re in. But what we ultimately decided is we bought one of those tough sheds. We bought the largest one we could that didn’t require a permit, and we put every single thing in the backyard and we determined the break even on that was like, I think at the five or six month mark versus buying or just putting everything in storage mm-hmm. <affirmative>,

Becca:
Which was a much better idea anyway, that way we could be gone for as long as we would ever like to be. Um, so there was that, there was the get getting rid of things. But for your audience, I would say it would start with, Hey, where do you wanna go? Most people do have an idea of where where they wanna go and then, um, determine your current living situation. Can are, do you own a house? And if so, can you rent that out? Uh, how much can you rent it for? Is it better to do an Airbnb depending on the time that you’re gonna stay? Or is it better for a long-term rental? For us, it was better, a long-term rental and just put everything in a storage shed in the backyard, um, and then determine, uh, the cost of living where you wanna go.

Becca:
I have a guide that we’ll go into that actually has a cost of living calculator for that. Uh, but if you have kids back up, it has to start with that <laugh> because don’t do like I did, which I said, great, we’re gonna leave it all behind and live in a grass hut on the beach in Costa Rica. Oh, wait a minute, I have two kids and they need to go to school and I’m sure not gonna homeschool ’em because that’s what we’re trying to get away from in the Bay Area. So, so I said, okay, we gotta back it up and start with the school. So we, we started with the very quality, uh, good high quality school and then determined our place from there.

Charles:
Oh, that’s great.

Becca:
It’s a lot easier than you think. I, I would say to your listeners, there’s something that’s known as the expat journey in which the first three to six months are, are, are kind of hard. You’re, uh, you’re trying to figure out where everything is. You’re meeting new people, you’re finding your expat crew, you’re trying to integrate with the locals, getting the language down. It’s a little bit tiring at first, but it’s about at, you know, beyond three months or for some beyond six months than it’s much easier and you’ll be so thankful. You, you did, you did leave it all behind

Charles:
<laugh>. Yeah. It’s also an interesting, too, like you said, the cost of living. And I know that’s, you offer it in your guide, but it’s, if you ever look on that between even areas that you, that are pretty popular, you’d say like parts of Europe and stuff like that, you look at and you’re like, oh, well this is the same price as home, but this is much less expensive. So it’s very interesting if you’re ever burning time and, uh, wanna kinda see how that goes. It’s very, I’ve, I’ve looked at that before and it’s like, wow, that’s, I never knew was that inexpensive when you rent an apartment for 12 months or rent the house for 12 months, not 12 days. So it’s, um, definitely, definitely different.

Becca:
It’s definitely different. And then, um, you know, something else to think about is how much can you live very well in another country? Mm-hmm. <affirmative> for like you just said, but your primary residence becomes a tax deduction. So your trips back home become tax deductible to a certain percentage to visit your asset, which is your primary residence. And meanwhile visiting family and everything else. Then the process of getting your home ready to rent, all those things are deducted off up to about a year ahead of time. So you need a new kitchen, new bathroom to make your home rent ready. All those things are tax deductible. So later. Interesting. You want a new kitchen, new bathroom, here’s your ticket,

Charles:
<laugh>. No, that’s a great, that’s, uh, that’s fantastic. There’s always different ways of working around it. So if you, if there’s a will, there’s a way, right, with what you’re working on,

Becca:
There’s a will, there’s a way that, that’s it. And people think of a lot of reasons why they can’t do this. Everybody says, oh, I wanna leave it all behind, you know, some point in their life and move to a tropical island. But they list all the reasons that they can’t. And I’m here to tell you, there’s plenty of reasons and ways you can do this if you want it bad enough. It’s just how bad you want it. And what’s your sense of why and the best sense of what the, the, the people that have the best sense of why are those, that the why is outside of yourself. And for me, it was for my children to learn Spanish also in addition to leaving the madness of the Bay Area. But, um, I’ve been on this quest since they were very little and it was imperative that they live, uh, foreign country at a certain point in their life to be immersed in Spanish.

Charles:
Interesting. Are you, how long do you guys think you’re gonna stay there in Costa Rica and what’s, what’s next? Uh, or are you there for extended period of time?

Becca:
We are going be here as long as possible. Um, so we just see where this journey takes us. Um, I, I, eyes on Europe, I was actually hoping for Europe during this pandemic, but Europe wasn’t doing much better than the US so we decided for the, uh, the tropical beach town that was a little bit safer, but as, as long as possible is my answer right now.

Charles:
That’s great. So coming to a conclusion here with our show, I just want to kind of get some questions or they ask, uh, all of our guests and, uh, one of them being, what are common mistakes you see other real estate investors make during all of your, your career in real estate investing?

Becca:
I would say, um, a common mistake is underestimating, um, underestimating the, uh, the looking at cash flows. Many people look at the numbers and say, okay, great, uh, you know, we, we got this cash play, but they, or rather they overestimate how much that they can get for rent. So they’ll, they’ll budget the rents at the highest point in the market based on the comparables. Um, too aggressive performance that are too aggressive, uh, buying at a point in the market that it’s, uh, it’s saturated too high of a unit cost not buying, uh, on the path of progress in, in an an emerging market. Not buying units large enough, um, for an economies of scale 50 units. And up in, in my opinion, some people will say 40, but uh, at least 50. And um, and then for your first couple deals, it’s often buying properties that are advertised as maybe Cs, but, or maybe C minuses, just, you know, right on, on the border of <laugh>, maybe not good areas cuz they look enticing when you’re doing the numbers and you’re underwriting 200 deals, then you finally find one and, and then you’re happy the numbers work.

Becca:
But oftentimes when you really check the areas, uh, also I would say not investing with experienced operators and that’s what my business model as yours is as well. Um, in that we are vet these deals, we are investing ourself side by side with our investors and we are partnered with experienced operators. This is a game that you bet on the, uh, you know, the jocking not the horse, so you need to know who those people are. And I know the other side of it because my first passive deal just actually went up and smoke. The numbers looked good, but operators weren’t experienced enough. Knowing what I know now, I absolutely vet the operators then the area then deal.

Charles:
Yeah, that’s fantastic. Um, it’s always important to

Becca:
Have, I started, I started with, sorry, <laugh>. No at all. I started with the deal and my mistakes and my, um, first limited deal I partnership. I started with the deal and then the area and then the operators and it should be exactly opposite operators area deal

Charles:
<laugh>. It’s funny

Becca:
To talk for you.

Charles:
No, no, it’s fine, it’s fine. We a touch of a delay. The, what I was saying is that, uh, what I find from most the wealthiest investors that we work with, uh, more sophisticated, let’s just say is, uh, that they are working. Just how you said that it’s on the syndication and then the operator and then working down the line from there and coming to, you know, yes, the deal, the property manager, they’re going all down the line, but it starts with the operator because that’s gonna make or break it and uh, the resourcefulness of that operator as well. So there’s a lot of factors to it, but I’ve seen it much different when you, between people that are sophisticated and people that might be new investors and they go more for deal, sophisticated it much more for the operator and know more about you and what your team is experienced first. So interesting.

Becca:
Yeah, yeah, that’s exactly right. Which is the tremendous value of your services and my services is that we know these people because there’s plenty people out there, like I was in med device and all my other physician friends that they say, I, you know, I don’t even have time for that. I don’t know who’s a good operator. I’m not gonna go to these meetings, just find them for me. And, um, and, and that’s what we do. So,

Charles:
So what do you think are the main factors that have contributed to your success over the years? Years?

Becca:
I think, um, trial and error. <laugh>. I’m sure there’s another way. Uh, <laugh> I’ve gotten all the education I could, I could continue to get, I mean, you could always, uh, there’s always more, but I’ve been in two coaching programs thinking, okay, I’m gonna find some magic bullets, something I haven’t seen before or done before and let me spend more money. But realistically you just need to get out there and, and see for yourself, um, for those just starting out and for younger people, it’s good to house hack. You’ll learn a lot from house hacking. Uh, then moving up into, you know, maybe, um, limited partnerships. I would say I might just skip that kind of 12 unit experience really for, for many. Um, but it is, uh, it, it’s just experience really in the whole thing. And even as a passive investor just sitting on the sidelines, you’ll learn a lot.

Charles:
House hacking is great. I probably wouldn’t suggest anybody to get into the, the size or the of the one you got into initially with all you’re doing. Um, that’s a red flag when you’re, you and the contractor are the only ones trying to bid for it. But, um, I got into my first house hack and it was nothing as much as yours in depth as yours, but it was a, it was an experience and it took like a year or so. I was very young when I did it, so it was like, it took like a year or two to like do it a hundred percent, but I was able to get renters in like, you know, 90 days or 60 days or something. But it was just, it was, it was something, it was something. And I, second one, I knew a lot more about it, my second investment property, but it’s just the first one. I still have scars from that that I, uh, I can revisit and know we learned about this. Charles, what are we doing? So <laugh>, but, um,

Becca:
I’m right there with you. I’m right there with you. There’s a, uh, there’s a podcast I was on, invited on. It’s the Real Estate Unsuccess Stories. I thought, oh no, this, I don’t think I should be flattered by this, but hey, maybe we’ll go on together, Charles. Right? You wanna go duo?

Charles:
Um, so how can our listeners learn more about you and your business, Becca?

Becca:
Okay, well, uh, you could find me at, uh, hint investments.com. That’s investments with an s i I have a free guide for your listeners. In fact, it’s, um, it’s called Six Steps to Put Your Income on Autopilot and Move Overseas, which is just a fun, easy read free guide. And it, um, it goes over exactly how to do this. So it will have some good resources in there for Cost of Living index that I mentioned earlier to determine where you’d like to live. There’s also, um, the, the best places to live in 2022 for expats, which is an excellent resource. Um, it also goes into how to do this, how can you stitch different things together, look at your stock account that’s maybe not loving you back, especially right now, <laugh> and, uh, time to move some of those things into passive income. Look at your retirement. It, it talks about how to actually invest with your retirement funds. So, um, that’s a great place to start. And um, and that could be [email protected] or you could reach out to me directly, um, at [email protected] I’m also on LinkedIn. You could see Becca Hegar or be Hint, my hint. Taggart’s, very long married last name that no one can spell. So hints a lot easier, <laugh>.

Charles:
Great. Well I will put those links into the show notes. Thank you so much for coming on today and, uh, yeah, looking forward to meeting with you, uh, face to face at some point here, uh, in the near future.

Becca:
Oh, me too, Charles, thanks so much. This has been fun. And it’s a delight to be on here with another multi-family investor and international traveler. We’re a, we’re, we’re definitely a whole tribe amongst ourselves. So that’s for, it’s been a pleasure.

Charles:
Thanks again,

Becca:
P Avida as they say, Costa Rica p Avida, pure life.

Charles:
Great. That was awesome. Thank you. Thank you very much.

Charles:
Hi guys! It’s Charles from the Global Investors Podcast. I hope you enjoyed the show. If you’re interested in get involved with real estate, but you don’t know where to begin, set up a free 30 minute strategy call with me at schedulecharles.com. That’s schedulecharles.com. Thank you.

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About Becca Hintergardt

Becca Hintergardt brings to the multifamily space a successful sales career of medical device sales at a leading Fortune 500 company, as well as valuable multifamily experience. Becca strives for the uncommon. She currently lives in a boutique surf and yoga hub in Nosara, Costa Rica. Her life in the tropics is largely supported by passive income from her multifamily real estate investing.

Becca’s team is under construction on their newest asset a 100-unit Quality Inn Motel in Arizona that they are converting to 65 multifamily units. The complexities of a hotel conversion process provide her with well-needed challenges to continue learning and growing in the multifamily industry.

Additionally, she has invested in and overseen multiple projects, including a condo renovation/conversion project in San Francisco, a multifamily value-add project in Kansas City, and she is an LP on several buildings totaling over 450+ units throughout Texas. Becca is inspired to help others live an authentic life of passive income freedom and location independence through real estate investing. She invests in multifamily properties in the US and double your money new construction projects in Costa Rica’s highly sought-after tourist towns.

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