Disclaimer: Transcripts were generated automatically and may contain inaccuracies and errors.

---

All right, everybody will welcome to another episode of replace your income with Kevin and Steve. So I am actually only doing the introduction for this episode. Steve, as you may be recall from last week’s episode where he was with Gary and Preston and Oklahoma, Steve has been traveling to all of our markets. I’ve been at a town just on like vacation.

So Steve was in Florida, and had a chance to talk to Ryan, who is our acquisitions director in the state of Florida. And they go have this incredible conversation about why Florida is still booming. What is driving the reason that Florida is booming, talking about some of our newer market areas in Florida, and talking about the new construction projects that have really come to prominence for our deputy real estate clients.

This is an awesome episode, you’re going to enjoy it. And then Steve and I should be back together next week. But for now, enjoy this incredible episode from Stephen Ryan, on the awesome market of Florida. We’ll talk to you soon. What would your life look like if you could replace all of your working income with simple and conservative investments that could do it for you.

Over the last 13 years, we’ve helped 1000s of clients transact over half a billion dollars in simple and conservative real estate transactions, allowing them to begin replacing their working income with real estate investment income.

Each week, we’ll be pulling back the curtain on the ins and outs of real time retirement based real estate transactions that will transform your financial future. Even if you have no real estate experience. This is replace your income with me, Kevin claesson. And Steve Earle.property managers are the one we went in today I was trying to get you inside that deal just closed on Friday and the property manager already had taken over.

And then the one that closed the prior Friday, somebody has already moved in. And so that’s the experience that people are having at this juncture is that the homes are renting like lightning, the demand is there. And especially with our focus being on new construction, that’s something that people want right now. And that’s what we’re providing.

Welcome to replace your income with Steve Earle. And well, Kevin claesson actually is out of town today. He’s not available, and I happen to be in beautiful Orlando, Florida. So the past few weeks, I’ve been traveling across the country, I spent a few days in Memphis, Tennessee, and Oklahoma City, Oklahoma.

Last week, actually, I was there visiting our teams and kind of touring our markets there and taking a look at things. You know, I really enjoyed my time with our teams in those markets. And you know, I have to say, I get to work with some of the best people in this business. It truly is fantastic. The partners that we have in the different markets where we are, it’s it really is phenomenal, you know, real estate agents or property management teams, title companies, builders, Home Inspectors and rehab crews. It is just phenomenal.

Today, I’ve had the opportunity to spend a few hours with our Director of acquisitions in Florida, Ryan Heiner, Kurt, you have been working with Ryan for many years. And he is hands down one of the smartest people that I know, and probably one of the most talented and experienced investors in the country.

And I don’t say that, you know, to be exaggerating at all, if you had the opportunity to get to know Ryan as I have. He’s really a wealth of knowledge, information and expertise. So I’d like to welcome Ryan to the podcast today. Hey, thanks, Steve. Really glad that we could be together and do this podcast from your office in winter garden here. Yeah. Maybe tell us a little bit about you know where we went today a little bit about the market, generally speaking here in Florida. And what are some of the things that you’re seeing lately?

Yeah, great. So we got started today, kind of taking a loop around one of our expansion areas, which is citrus County. It’s on the northwest quadrant of Central Florida. And we got a great overview. As you know, we’ve been doing a lot of stuff over the years in the southwest Orlando, Polk County, Lakeland Winter Haven Davenport, some of the most popular Southwest suburbs of Orlando. So today, we got the opportunity to kind of go in the northwest area, Northwest direction of Central Florida.

And it’s eye opening and there’s just so much going on in the state. It’s hard to get away from all the action, and it’s one of the places that you sort of can and and then you you kind of get back into a different type of action when you’re there. So it was great to see all that we can we can dive into that. But what we’re seeing in the market is continued growth, it really accelerated with the pandemic.

A lot of people have relocated to Florida since you can work from anywhere. Why not do it in beautiful sunny Florida, that you mentioned to me the other day that you to get a drive with your family not to drive it a little vacation in North Carolina. Yeah. And you’re like literally counting the license or, you know, looking at the license plates. And yeah, I think everyone’s coming into town. What are you seeing in terms of like the influx of people coming in.

Yeah, what was really eye opening is specifically on the way back from North Carolina on that stretch of i 95, which is the main interstate on the east coast of the US. And my kids just, you know, we stopped counting at some point all the moving trucks and u hauls and trailers and what we’re clearly families with two cars loaded to the brim, tailing each other from, you know, Connecticut, New Jersey, New York, really the whole northeast, lots of people from Philadelphia, Pittsburgh, all the Pennsylvania area.

So it was just a nonstop, it almost looked like an exodus of people. I’m sure that was just a microcosm. But it wasn’t just people on vacation. These were people that have packed up their lives, and we’re entering the state. So we found that interesting. We can play the license plate game and get get pretty far and into it on the east coast. We’re usually lacking Hawaii and Alaska, but we pretty much saw just about everything else.

And but the most eye opening part was that come back from the Blowing Rock banner elk area, which is normally about a nine hour drive and was a 12 hour drive just packed with moving trucks and you know, u hauls, like I mentioned. So it was interesting, for sure. I was a little bit of a slog, but you could clearly see a lot of people are relocating to the state right now.

So what are you seeing in terms of kind of numbers of, I guess, migration? Yeah, net migration into the state how that’s kind of affecting the market right now.

What’s interesting is the census data just came out the other day. So there’s, there’s some, you know, the 10 year snapshot was, Florida grew by 7.2 million in the last 10 years, which is pretty remarkable. And we’re seeing a big chunk of that in Central Florida is the fastest growing area of Florida, specifically, Orange County, which is Orlando, and Osceola County led the nation or led to the state, which is you know, the main county we’ve been focused on one of the main counties that kind of the Kissimmee area, those areas, so but all of Central Florida had pretty incredible population growth, double digits, when compared to the US, I think the average growth was in the 7% range.

So we ranged from right at 10% to 28%, which was the 28% was around the villages, which you got to take a peek at that today. That was the fastest growing city in America for the last 10 years. And we happen to be doing business in the counties, the counties adjacent the county directly adjacent to Sumpter County. So that’s pretty exciting.

But yeah, the state of Florida has a combination of migration happening from other countries, that’s really accelerated in the last 10 years, you can feel that happening, you can see the diversity happening here. And then migration from the northeast is our primary driver. But it’s it’s happening from all over the US, but it’s definitely that East Coast connection is the primary. And so and then births are exceeding deaths in a big way.

Central Florida is very young, Florida is such a younger state, have a lot of friends that are relocated from the northeast New York especially and, you know, the joke is, you know, you’re gonna have your standing reservation at the sizzler at five Ryan right? And, and when they they end up moving here, and they’re moving here, because they just hear so much about it. And they’re finding out that it’s a young state, and there’s a lot of action happening. And Central Florida, if you look at the major cities, Orlando is the youngest state in the state of Florida.

Pretty amazing the trends that you’re seeing, and I know that to some degree, government, both statewide local governments have kind of recognized that this has been happening, didn’t just all of a sudden start right. You’ve been seeing this for a while. And as such, you know, there’s a lot of infrastructure projects that I can see going on. I know you’re aware of a lot of those, the projects that are going on, how is that helping to, you know, sustain this growth? And how is that affecting, you know, real estate values and real estate, you know, generally speaking in terms of, you know, individuals that might want to be, you know, investing in Florida. Yeah. So

kind of going back to that trip to North Carolina, the one thing we learned was, as soon as we left the state of Florida, the size of the roads just dialed way down. And it’s very clear that infrastructure is a huge priority here.

The I four ultimate project started as I think a 3 billion it’s there on 7 billion, but they’re almost wrapped up with it, the private rail to Miami from Orlando, they’re laying track, that’s slight delays with COVID and whatnot, but that’s happening that’s supposed to open in the next 18 months. And that’s a private high speed rail, hidden so to connect the population center of South Florida, which is about 6 million with our area, which is knocking on 3 million is pretty significant. And then that’s I’m going to then roll over to the Tampa Metro, which isn’t that terribly far away. So those are some of the major ones.

But all the highways, freeways seem to be expanding. You saw today, you know, even your local regular roads are just seeing road projects expansion, you know, the toll roads are expanding. And so all of that stuff’s happening road infrastructure wise, you’ve got the rail that we just discussed, the Orlando airport, pushed forward, even with the COVID, shutdowns and everything pushed forward on its $2 billion expansion, new international terminal.

So these things are adding a tremendous amount of value just in terms of utility, that we’re even though there’s more people, we are being proactive with regards to the roads, you know, are they staying ahead of it? I don’t know. It’s sort of like you get a seven year highway expansion done. Now you need to do a new one.

Well, and I find it interesting. And also, I guess, refreshing to see like, how much like open space? How much open? Yeah, there is like there’s just a ton of room for growth.

Yeah, yeah. And it’s really been primed. And they seem to be, I guess, looking forward with in terms of the environment we talked today about, they’re enhancing the septic systems in some of the more rural areas. And, you know, they’re focusing on making sure that they protect the Florida watershed. And that’s a big deal.

So there’s, you know, I’d love to say it’s all smart roads, some of it’s kind of runaway, depending on where you’re at in the county, and what municipality, but there’s a lot of growth that’s happening. And I know from developing some subdivisions that, you know, the developers are having to come in and widen the roads around those subdivisions.

And that’s somewhat common everywhere. But they’re really holding these developers accountable on ensuring that they have provided the right type of infrastructure to support the neighborhood. They’ve throttled development, a number of instances in the last two years where the schools couldn’t keep up.

And so they put a moratorium, and then accelerate the school building. So the current governor took a big push on with tourism down with traffic down, he accelerated funding on road projects throughout the state, and said, this is our time to get ahead on these road projects. And so that was a really big push.

So we’re seeing state local leaders coming together on those sorts of things. And everyone’s benefiting and the number of jobs is drawing in is pretty substantial as well. So construction is a huge driver of the economy in Florida and the infrastructures, part of that

nice. So historically, you know, we’ve been we’ve been here buying, helping our clients purchase properties for the last, you know, 567 years. And historically, we’ve been buying, you know, what, kind of the South Orlando Kind of, yeah, suburbs area, Sienna, Winter Haven Auburndale, like those those different areas. Yep. And those have been fantastic areas.

We’ve got we have a lot of clients and a lot of properties, put the pressure supply and demand, some of the issues that stem from people moving in the fact that, you know, prices are beginning to really rise or have risen over the last, you know, couple of years, you have helped us move into a new area. Yeah. Citrus County. Yeah, um, that was exciting to go up north just a little bit. Yeah. Maybe talk about that transition. Yes. From from where we were buying heavily to where we’re going now, how we’re going about doing that and the type of product that you’re delivering?

Yeah, so kind of the genesis of it was saying, really, almost related to COVID COVID, spurred the idea was, people are now able to work from anywhere. It’s not just work from home, it’s work from anywhere. And with that, a lot of people we saw the population just really lift off in Florida, even though the economy was is heavily dependent on tourism and those sorts of things. You know, people said, Oh, Florida, tourism is going to crush the economy.

Instead, we saw a huge influx of people and really, the population growth accelerating to the point of 34,000 new building permits and the Orlando Metro is, is substantial, but we have this idea that, okay, there’s so much turmoil in the market, what out there is this stable, predictable node that we could find within the state of Florida, that wasn’t susceptible to hurricanes from a storm surge area, there’s a lot of gray areas of Florida, that are smaller markets, but they might be very low, long and have lots of floodplain.

And so we kind of started ruling out certain factors and focusing on areas that people would want to enjoy themselves that had ecotourism type attributes that had slow measured growth, and that the job force was not reliant on one specific industry. So you know, think of the major employers being municipalities, hospitals, schools, power plants. You You know, that type of thing, not a, hey, here’s an auto plant.

And if the auto industry shuts down, everybody’s furloughed, or, you know, something like that, so we looked around, and we also wanted to stay within a relatively easy commute of Orlando, and or Tampa kind of focus on the Central Florida. That’s our backbone. That’s what we’re good at. So we wanted to do that, we wanted to find a place where our current management team could expand, our agents would also feel comfortable getting in the car and driving and checking out homes for clients. And that led us to citrus County. What’s interesting about citrus County, there’s, because Florida has 23 million people, there’s a lot of counties, people don’t know about that have a lot of people, and citrus is one of those.

So we’re able to take a county that’s got about 160,000 people that’s growing at about 10%, you know, over the course of a decade. And so above us population growth might be a little bit below Florida population growth, but it’s in the path of growth. And so what we liked about citrus was, you were a little bit off the freeway system, but the freeway system is coming towards you. And we’ve seen this time and time again, is you follow the master infrastructure in the state of Florida and where that master infrastructure is moving to, and if you can be ahead of that, you know, it ends up being a great investment.

So you buy when things are sleepy, and then at some point, they wake up just with the trends in Florida, we don’t see that changing. And so it led us to citrus county where we could get in at a price point that would be provide high level of cash flow higher than what people investors are used to in the state of Florida, but still have growth prospects ahead.

So you know, not, you know, some sleepy cow town in middle of nowhere, that’s going to be a sleepy cow town in 10 years, but an area where there’s a specific plan for freeway expansion, the freeways are under construction, they’re marching that direction, and it’s significant growth might be five years out. So that led us to the citrus County area, we wanted to make sure we could find homes where you could still get a brand new ideally.

And we always look at existing homes as well. But while the opportunities there, focus on brand new construction, three beds, two baths, two car garage, 14 to 1600 square feet, kind of the sweet spot, block construction, quality features the tenants are looking for, whether it’s luxury vinyl plank, stainless appliances, and then we talked about the ecotourism aspects.

So, okay, you’re there, you’ve got an affordable place to live, and there’s jobs nearby, but what’s your quality of life? And so one of the reasons we like citrus county is I would go visit my friends river house out there. It’s on the rainbow river, if you get a chance to Google that to anybody who’s listening, but Well, I just have to say we stopped by there.

And that is probably, you know, one of the most like pristine, you know, bodies of water that i think i’ve ever seen, like we could see clearly to the bottom of this river, which was about 20 feet deep and can see detail down at the bottom. That was just phenomenal. Yeah, just love that. That. Yeah.

And we had lunch at swamp east, which is a classic, Florida haunt. And, you know, we watched all kinds of people go by and kayaks and paddle boards and saw river flooding. Yeah, yes. Phenomenal. And so that’s the type of lifestyle that’s in citrus County. And it’s not just that one spot. There’s Crystal River Crystal Springs, there’s a lot of springfed bodies of water. And it’s an area that’s known for ecotourism. There’s glass or clear bottom kayak adventures, and, you know, great hikes and trails and that sort of thing. So, you know, we we have this idea that this concept that people would want to be in an area like this, I think it’s happening a little faster than we thought actually.

And then, you know, the growth in an area like citrus is often coming from places like Orlando, where people the growth from Orlando is coming from places like Miami, and the growth from Miami is coming from places like New York City, and people just are always sort of looking to get to that slightly slower pace of life and avoid the heavy traffic of the population centers of Florida. And so that brought us to citrus. That’s kind of the the concept in a nutshell.

And I was super impressed with the product with the inventory of homes that you are building that other builders are supplying, you know, to us to our clients. As I walk through them, I was impressed with, you know, the nine foot ceilings with casings, the upgraded cabinets, the ceiling fans that are already in there, not just like the typical, you know, Sunday you might buy at Home Depot, but these like, really impressive. Yeah, the garage door openers already in. You’ve got the stacks down on the front, which just adds a whole new dimension.

When you think it’s like, oh, well, why you’re worried about those things for renting? Well, number one, we want to attract the best, you know, renters possible. These are the types of things in these properties that differentiate from other product that’s out there. So, side by side comparison, rent being equal, you know, tenants are going to choose, you know, our properties over. Yeah. Other properties.

Now, the other thing is the resale value in the future. Yes, is these are these are homes that home owners, eventually we want to live in, you know, 510 years down the road, when we go to sell these properties. So super impressive, as super impressed with the neighborhoods with the construction. The build work was was just very impressive.

Yeah. And it’s one of the things I like about that area is, when you go out there, the existing product isn’t substandard. It’s awesome. It’s Yeah, retirees that have their slice of heaven into play. And that’s a good way to put it slice of heaven. Like, really what what we saw what i what i saw is this.

And there’s there’s a great area amenities within the citrus Springs area, for example, the libraries just like the, you know, community centers, and all those sorts of things and the bike trails. So I thought was pretty What do we actually drove into? I don’t know, was it? It’s not the city center, but like citrus springs? Yeah, that area, like beautiful waterfall. Yeah, they just really, like made it very attractive. There’s a big pride of ownership there, you know, yes, a great deal of pride of ownership.

And the average home isn’t a production home, where you’ve got 50, the same house on the same street, there’s a lot of variety, and overall quality is pretty high. So we found it enjoyable to do business out there. It’s also very safe. We haven’t had any instances of crime or anything like that. And it just seems to be an area where the property management companies have waiting lists of tenants for homes, which might not be unlike other places because of the shortage. But the property managers that, you know, I’ve talked to said, it’s always been this way, there’s, there’s always people that want to be in this area. And there’s always been a shortage of rental homes available.

So that’s one of the fears that any new real estate investor has right is I get this home, I go through the purchase process, either get a rehab it or wait for the construction to be done. And then getting it rented is kind of my next big anxiety. Yeah. And so you’ve kind of touched on that, that that that’s one of the bigger concerns in a less populated area, is how quickly is my property going to rent? Is it going to rent, you know, at the projected rent, what have you seen so far?

Yeah, we’ve seen things come in line or exceed our rent ranges, and or be on the higher end of the rent range, rather, and the property managers are, I mean, the one we went in today, I was trying to get you inside that deal, just closed on Friday, and the property manager already had taken over. And then the one that closed the prior Friday, somebody has already moved in. And so that’s the experience that people are having at this juncture is that, you know, the homes are renting, like lightning, the demand is there. And especially with our focus being on new construction, that’s something that people want right now. And that’s what we’re providing.

But, you know, in the last few years, we we have delivered more new construction than ever before. And, you know, it’s such a great product that, you know, again, you talk about peace of mind, having property, brand new, you know, dealing with, you know, leaky faucets, and that kind of thing. So, so it is, it’s been a great thing, many of our clients, you know, have preferred to get new construction, that’s not always necessarily the best option, but it is one of the best options.

So, you know, right, like across the country, there are, you know, there’s lots of different markets that you know, are decent markets that are good markets, where where you can buy, you can rent, have good cash flow, have good appreciation in good neighborhoods, with good attendance, good property management, and so on. So what do you feel like is really kind of the unique selling or the unique advantage here in Florida that, you know, our clients can can think about as they’re deciding what market to go to? Yeah,

I mean, there’s only one Florida. There’s a lot of other states that are very similar. I’ve lived all over the US. And, you know, Florida is the only in the continental US, I guess, why would be the only tropical state in the nation. And that’s cost prohibitive. Last I heard. And so, you know, in January, it’s 72 degrees is the average high. You know, there’s a beach within, you know, an hour of wherever you live in the state of Florida, even if you live smack in the middle, like we’re sitting right now.

And so that driver that the long term population trends are just more people coming in. And so when you think of over 7 million people in the last 10 years, it’s remarkable. We passed New York State to be third now so you’ve got California then Texas and then Florida. I just don’t see it changing after the housing bust The State of Florida lost population for one year, and then it broke even. And then the next year 100,000 gain than a 200,000 gain.

And so that’s that’s the trend is people might have a falling out with Florida, but they keep coming back. You know, the joke on the East Coast is it’s God’s waiting room and all roads lead to Florida. And it seems that if you’re on the east coast of the US, Florida is on your mind as a place that you could see yourself living.

So many memories are made here with things like Disney and family vacations to the beach. And so it just plants that seed in people’s mind that this is a place they could see themselves living. And if you compare it to other places with fantastic weather, and we’re a discount to California in terms of pricing, we don’t have a state income tax, that’s a huge plus, the state has billion dollar surpluses in its budget.

And you know, I just think those are the things that the weather you can’t change it. I mean, that’s I mean, the weather changes, but it’s not like it’s going to be cold here anytime soon, it’s going to stay warm. And you wouldn’t believe how many people I encounter and they’ve moved from Michigan or, you know, Pennsylvania, or Wisconsin or wherever New York and they say I’m never doing another winter, I’m never shoveling snow again. And that’s not changing.

So there’s a lot of things that could change. You could have political leadership change, and those sorts of things. But the weather, the location, the access to beaches, and amenities. Those are permanent. Yeah, at least permanent in our lifetime. And so that’s the big driver to me.

Well, and I’d have to say amen to every one of the things that you just stated. It’s one of the reasons why I personally, and as a company, you know, we’ve bought quite a few homes here as well. We believe in the market, we think it’s an awesome market. Let me end with this question, too.

So overall, with the economy the way it is, with COVID, with home prices, it seems like every month home prices are going up. So the question that we get a lot is, should I just wait until things settle down? Should I wait till the market corrects and comes back down? You don’t investor to investor, what would be your advice to me and to everybody listening today?

You know, investing to me is a lifetime game. And so, you know, if I was buying one home and one home only, maybe I’d be more focused on trying to time things perfectly. But I think the goal of any real estate investor is to build a portfolio.

And I think you treat it the way you would invest in your 401k and see your kind of dollar cost averaging, you know, you’re you’re always buying no one can really predict the future. But we looked at the numbers, we have this conversation every year, just about and before COVID, you know, we saw our price appreciation after the housing bust go from 15% and 10%. And, you know, plateaued and, and really, you know, we’re still seeing 8% appreciation, which is fantastic on a historical level before COVID.

And then we had 18%, the last year and so you know, just when you think maybe it’s over there could be another like up. I hate making predictions. But I kind of am looking at the macro economic factors in the US and the fact that they’re printing trillions and trillions of dollars. And if they’re increasing the money supply by 10 to 20 to 30%. In a year. 30% being the most recent isn’t inflation, the rate in which the money supply is growing by just the most basic definition.

And you look at some of those areas where there are no impacts of interest rates and things like that an example would be home beach Island, where it’s billionaires buying real estate, and every transaction is cash. And those homes go up about the rate of the increase of the money supply. You know, the last 10 years, it’s been 10 to 20%, those homes have gone up because it’s all cash purchases.

But my belief is that there’s a good run in this market, particularly because of if you throw away the macro stuff, even and just say population growth in Florida is accelerating, you’ve got a significant shortage of homes in the market. And that’s led to demand off the charts and the big builders they’re behind. I think the next two to three years is going to see continued rent growth in the market.

And you have to remember, a lot of these people are moving here and the place they’re moving from is more expensive. So they’re okay. splurging a little bit selling that house in New Jersey that they’re paying $20,000 a year in property tax on and, you know, buying a half million dollar house here and having a pocketful of cash.

So I see the market continuing to grow at what percent? I don’t know, but I anticipate it, it’s going to beat inflation. I anticipate it’s going to be better than some other areas of the country. And, you know, I’m investing we’re scaling up and hoping we can continue to provide housing. Nice.

Well, Ryan, I really appreciate your time today. It’s been a lot of fun hanging out with you. Yeah, I’ve been around seeing everything. Yeah. And look forward to seeing rest of the team here later tonight. Awesome. And everybody listened today.

Thank you so much for listening to replace your income with Steve and Kevin when he’s back. Appreciate the many five star reviews you’ve given us appreciate you listening each week. And we love you and appreciate you look forward to the next podcast next week with Kevin back in town. We’ll get a little bit more excitement from from a regular host, Kevin, and hope y’all have a great day. Take care.

Thanks for joining us on replace your income with Kevin and Steve. Do you want to learn more about our company done for you real estate and to see if you qualify right now today to begin replacing your income with simple and conservative real estate investing done for you. Visit d f y dash intro.com.

Click the orange button. Watch our super quick webinar and fill out the little form on the right side of the page. You’ll know within 60 seconds if you qualify to begin replacing your income right away. As always, please rate review and share the podcast with friends and family. And until next time. Just remember, income replacement for you and your family may only be one property away. See you next week.