072: Buying over 2,000 Single Family Homes with Rod Khleif

Rod Khleif has bought over 2,000 single family rental properties in his career, but surprisingly he loves to invest in multifamily properties now. He bought many houses in the 1980’s when he was a real estate agent and could take advantage of low down payment investor loans. Rod had over 800 houses in 2006 and was worth a lot of money on paper, but his houses did not cash flow well. When the real estate market crashed, Rod was in big trouble.

He got rid of most of his houses and survived, but when he came back he decided multifamily houses were a safer investment. On this episode of the InvestFourMore Real Estate Podcast I talk about how Rod got starter in real estate as a Dutch immigrant, how he built his empire, how he became a successful agent, why he likes multifamily and much more including his book.

How did Rod Khleif get started investing in real estate?

Rod immigrated to the United States from Holland when he was 6. He became interested in real estate when he saw his mother do well with a rental property. As soon as he turned 18, he got his real estate license and started selling houses. By his third year in the business he was making over $100,000 a year, which was quite  a bit of money in the early 1980’s. Rod credits his willingness to do what others would not. He knocked on doors of people going through foreclosure, talked to as many people as he possibly could, and worked hard to build his business. Along with being an agent, Rod also began to invest in real estate. In fact Rod bought over 500 single family homes in Denver, Colorado.

How was Rod able to buy over 500 homes in Colorado?

Buying houses was much different back in the 1980’s and Rod took advantage of many programs that are no longer available. HUD and VA had special programs that allowed investors to buy with as little as $500 down! Those programs no longer exist, and investors now have to put at least 20 percent down.  Not only did Rod buy houses in Denver, but he bought properties in Memphis, Tennessee and Florida. He sold many of his properties and kept many as well.

How did Rod lose so much during the real estate crisis?

Rod did not focus on buying for cash flow when he had over 800 single family homes. He was doing fine when the real estate market was hot, but when the crash came, he lost a lot of money. Many of his houses were lower end and the bottom dropped out on their value. Rod sold most of his properties in order to stay afloat, but he did not give up on real estate.

Why does Rod like to invest in Multifamily properties now?

Rod came back from the real estate crash, but decided to change his investing strategy. He started to buy multifamily investments, because he felt the cash flow was better and they are safer investments. We disagree a little bit on this strategy, especially if you buy single family homes with cash flow, but Rod has been very successful with multifamily investments. Rod likes multifamily properties because he feels he can get greater cash flow, and the value will not drop as much as single family homes if another real estate crash comes. He also loves the idea of buying under performing assets cheap, repairing them or changing management, and increasing the rents.

Rod has been able to find many great deals on multifamily properties, but it is not easy. He rarely if ever buys properties listed for sale and gives us a few tips on how to find great deals.

• Network with as many commercial real estate brokers as you can.
• Find the big players who own many multifamily properties and become as friendly as you can with them
• Take people to lunch, buy them coffee, and always stay on their radar if they want to sell a property.

Rod has a little different strategy with his multifamily properties in that he is not looking to sell them in 4 to 6 years, but keep them long term.

How can you find out more about Rod Khleif?

You can find Rod on his website RodKhleif.com. Rod also has a new book coming out called The New Rules of Real Estate. He is giving away free copies if you text him at 41411 and text “Rod.” Rod has also started a wonderful charity that we talk about on the show called the Tiny Hands Foundation. The foundation has helped over 40,000 children.