Breaking into the real estate market in America as a non-American investor may seem tough, but with the right mindset and education, you can be successful. Just ask our guest in this episode, who has parlayed his experiences into a successful real estate business. Host Sam Wilson takes on real estate investor, entrepreneur and author Reed Goossens as they discuss getting into real estate in America. Reed talks about his journey from student to working construction, then coming to the US to follow the woman who would become his wife. Reed then discusses how he got into the real estate space and how having a great mindset helped him on his journey. Listen and learn more from Reed as he breaks down what you need to succeed.
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Breaking Into The American Real Estate Market With Reed Goossens
Reed Goossens, welcome to the show.
Thanks for having me.
The pleasure is mine. If you don’t mind, quickly give our readers a bio. Tell us a little bit about yourself.
West Texas accent all the way from down under. I’m originally from Australia. I’m not from America. I moved here in 2012 to chase a girl and to live as an expat here in the United States because I wanted to live in the US for a period of time. Fast forward years later, through many ups and downs, sleepless nights, visa issues and all the good stuff, I built a company that has $450 million assets under management multifamily acquisitions in Central Texas.
I’m the cofounder of two different companies. I’ve written a couple of books. I’ve started a podcast and hopefully, I try to keep as down to earth as possible during that time. My story is about inspiring others to take action. I moved here with no experience and limited funds. I didn’t know anyone. I was chasing a girl. I was trying to get a visa and all the things. It’s my story. If I can do it moving halfway across the world, so can the average American.
I love the if you can do it, so can anybody else stories. That’s part of what we’re losing here in the American dream, which is that you can come here. Even though the regulations and the hurdles are getting higher, you can still come here and do it. It’s still possible. Tell us about that journey. I’ve got three questions I ask everybody who comes on the show, and you’ve answered some of them but I have to say it because we’ve said it for 320 episodes at this point. Where did you start, where are you now and how did you get there?
I graduated from uni in 2007. My background is in Construction Engineering. I went to London and got a job there. I’ve worked on the 2012 Olympic games. I was building all the infrastructure up in 2008. If you’re leading up to Olympics, you need years of construction. After my visa ran out there, I went to the South of France and I was working as a deckhand on the wealthy mega yachts. If you have ever seen Below Deck on Bravo, I worked for a Russian billionaire as a deckhand across the Atlantic Ocean.
At that time, I had a weekend off. I went to running the bulls and I bumped into this cute girl who ended up to be my wife all these years later. We kept in touch and this was in 2009. I crossed the Atlantic Ocean to the Caribbean on this boat. I have had a great time but I’ve also studied Engineering and I didn’t want to be the hired help. I then backpack through the United States. I fall in love with the US, particularly New York City. This is 2009.
I moved back to Australia. I’m back in my engineering job and in love with this girl who’s halfway across the world. I said to myself, “I love studying Engineering but I didn’t love being a small cog in a big machine.” A lot of people probably reading this have the same feeling. I was stuck in a cubicle. For me, it was, “How can someone pay me to live my life?” I don’t know what that meant. I didn’t even know what entrepreneurship meant. That’s when I stumbled upon the book Rich Dad Poor Dad, and that got me started in my thought process of I can do more.
I felt like this star athlete sitting on the sidelines, watching them go by and punching the clock. I knew I had more to give but I didn’t know what that was. This was in 2010 and 2011. I started educating myself about real estate. At the end of 2011, I made my decision. I’ll stop and I’m moving halfway across the world. I’m going to go chase this girl. I want to live in New York City for a period of time. I was 26 and I thought, “Will my 65-year-old self regret this move because the worst-case scenario is I moved there, I don’t get a job, and I have to move back to Australia?” If that’s the worst thing that can happen to me, then I’m going to give it a go.
That’s the start of the coming to America story, and then in that time of that transitioning after reading Rich Dad Poor Dad into moving to the United States, I was self-educating along the way. I was hungry for knowledge. When I moved to the US, the access to information is so much more plentiful than what I had in Australia. I’m talking about the real estate investment associations and the meetup groups. Podcasting is huge now, but back in 2012, the US still had a rich tapestry of networking events that I could tap into that weren’t readily available in Australia.
We don’t have the population size and the sophistication of organizations like Meetup.com and that stuff. I’m two weeks fresh off the boat and I’m at my first REIA and paying $30 to get in the door. I’m going, “There are 200 other people in here all wanting to do the same thing as me. Here I am, already made the hard decision and moved halfway across the world. I got a job, a visa, and I started moving in with a girlfriend. I’ve done all the hard parts. Let’s start looking at some real estate here.”
For me, it was some incredible opportunities that also presented themselves because, in Australia, we don’t have secondary or tertiary markets as you do here in the US. We don’t have $50,000 properties. I bought my first property for $38,000. That’s the coming-to-America story that I speak a lot about because there were a lot of ups and downs to get here, and some cool stories along the way that I can probably tell you over drink some other time offline. It’s been a pretty hell of a ride getting to the US.
The courage it takes to do that, kudos to you for having the chutzpah to go, “We’re going to do this.” You said, “They overcome their fear by simply calculating what the downside risk is. Quantify that risk. Quantify that risk and once you know that risk, then you can either proceed ahead or say that risk is too great.” I think you did that. You said you bought your first property for $38,000. It’s surely not a multifamily property. Quickly give us the transition story from that $38,000 property until you finally said, “I want to go into bigger assets,” and then talk to us about why.
For me, up until that purchase of that first property, I’ve been self-educating for about two and a half years. Probably a lot of the readers may be in that same boat. They’ve been educating for a long period of time. I was being pitched these mentorships and all this stuff. I was like, “I need to go out and do it myself.” I’ve always been that guy that’s like, “I want to go give it a go.” I didn’t have a lot of money. I had some money saved and no one was going to lend it to me. I didn’t even know what a credit score was. I had to go use the money I have saved from my corporate job, which was everything I had, to buy this first $38,000 property.
I don’t get to deal with number ten without doing that first deal. That was powerful to me because I knew I needed to get off the starting blocks. It’s been a couple of years of reading the books and I was educating myself in Australia before moving to the US. I was like, “You’ve got to get going. You got to get in the deep.” You got to the analysis paralysis stage. You understand there is much risk as you can by reading a book. The next thing is you got to take action.
You don’t get to deal number 10 without doing that first deal.
I went out and tried to buy the biggest property I could for whatever I had in my bank account, and that was $38,000. It was a triplex. It was a single-family and a duplex on the same lot. This was in Syracuse, New York. It wasn’t anything spectacular, but it was something that I could afford, which was the first big thing and I can get to it in four hours of driving. I never actually drive. I didn’t have a car when I was living in New York City. I took the Greyhound bus. I could get up there and back in the day, and that’s all I needed.
The second part of your question is how did I transition? Everyone wants to know how did I transition. Getting that first property done was a struggle. What happened then was I was able to develop a little bit of credibility with the local bank. I pulled some money out of that first property. It was a line of credit and I bought a second one. I’m still working full-time to save up enough money, and then I bought a fix and flip in Philadelphia. This is about a period of 1 or 1.5 years.
At the same time, I sit down with a good buddy of mine. He comes down. Everyone travels to New York. I was like, “Come to New York. Let’s meet up for a beer.” I meet him up for a beer. He’s Mike Scott. He’s from Canada. We’d studied Civil Engineering together in Australia. I’m boasting and I’m like, “Guess what I’m doing. I’ve got two properties and I’m doing this flip. I’m crushing it.” He goes on to tell me like, “Well done. Great.” He tells me about a 70-unit deal he closed with his business partner. I was like, “First, I didn’t even know you were in real estate. Two, how the hell did you get 70 units? That’s a lot of units.” That blew my mind. He goes on talking about other people’s money, getting a mentor and seller carryback finance.
All these things that I’d been teaching myself with the books, and here’s a guy in front of me who just raised the bar. He put the bar at a new level and I’m like, “If he can do it, why can’t I do it?” That was where, at the same time, I know that I was getting to the end of my career. The Philadelphia property was going to be the maximum of the leverage based on my income. I couldn’t probably afford much more than that. I ended up liquidating those two properties in Syracuse. I went and got a mentor because I knew if I wanted to play the game, I needed to go and get a mentor.
How much did you get out of those liquidations? This will tie in to one of my last questions.
The first property that I bought, that triplex, I had issues with. I’m fresh face, bushy-eyed Australian learning about Section 8 housing here in the United States and I learned about it. On paper, it’s great. For the first six months, it’s great, but then there was a drive-by shooting. I get my money back. I ended up selling it for $60,000, but I put $10,000 into it plus the cashflow on top. I came out ahead and I learned things along the way, which was the best experience. You couldn’t ask much more than that. I didn’t lose my money, I made a little bit, not a ton, but I learned a ton of experience. It gave me the confidence to go out and do more.
For that one, you made $12,000, then what was the other property?
The other one was a $45,000 property. I used to call it the ATM. It was two immigrant families. They pay on time. It was great. I bought it for $45,000. We ended up selling it for $60,000. They weren’t simultaneously. It’s one sold first, then we sold the second one. Again, it’s about giving yourself permission to show that you did it and I did it. I got those first couple of deals done. That’s what helped propelled me into the next stage of my career.
You have $25,000 or $30,000 may be in that profits total from those two deals and you said, “We’re going to clear the decks and we’re going to do the next phase.” What was the next phase?
The next phase was going and finding a mentor. I was pretty frugal. I didn’t want to pay any more. I paid $2,500 for my mentor, and he’s a pretty famous guy now that you probably all know. I think I was his second or third student. He’d only done one bigger deal before I came onboard. He didn’t have a ton of experience but he was also young-ish like me. He’s in his early-30s at that time. Back to the mental state, the money I spent on this gentleman was back to I’m worth spending money on myself to improve my education. If I can’t take a bet on myself, then who am I going to take a bet on?
There are so many people who are stuck on the sidelines because they’re not willing to take a bet on themselves. In my journey of moving to the United States, I was taking a bet that I could get a job and I could work out with a girlfriend. That’s the bet I was taking. The second bet is I’m going to go liquidate some deals. The same bet was I can do this. I’m going to find some properties and I’ve found a property.
The third bet is I need a mentor. All these things are little crumbs and secrets that if you look back in your own life, you’re going to see those bets keep coming up. If you don’t take them, then you’re going to miss out, and the fear of regret for me is quite a big driving factor. I got the mentor and that mentor helped me. It wasn’t a silver bullet but it helped me stop paving the way towards where I am now. There’s a whole journey in that of itself, so I’ll stop there.
One of the things that I love focusing on in this show is the mindset. There are enough how-to books out there that are going to say, “Go do this step-by-step.” Someone hat was on the show said, “This is not rocket science. It’s a pretty fairly cut and dry path. If you repeat the steps of about the first 10,000 people that you see doing it ahead of you, you’ll figure it out.”
Some of the things that you’ve mentioned here, finding a mentor is great. I love the bet on yourself idea because that’s a new way of putting it that I don’t think a lot of people consider. You do invest in and bet on yourself, but I want to focus on your fear of regret because I wonder, now that you’ve gone from two properties to $450 million in multifamily properties. What are some things right now that are fears of regret that you are working against or trying to overcome?
When I moved here years ago, I did not expect to be sitting here. That’s the first thing. That in itself is power and an example of what Tony Robbins said, “You overestimate what you can achieve in a year, but you underestimate what you can achieve in a decade.” That is so powerful. I got a script of what I thought I would achieve when I started down this path. That’s the beauty of what we do and becoming an entrepreneur, discovering oneself and the mindset. Humans are pretty incredible creatures when you put your mind to it. It is about mindset.
I don’t stress what’s going to happen in my mid-40s because the last years have been freaking awesome. I know the next years are going to be even better. I think it’s a mental calm or resilience. I don’t know what the word would be, but that comes through a lot of hard work. It comes through a lot of betting on yourself. It is driven by the fact that I don’t ever want to look back on my life and say, “I wish I gave that a go.”
That’s what I asked and I challenge all the readers too. What would your 65-year-old self say about your decision now? If they approve of it and say, “I’m glad I did that. Even if I failed, I’m still glad I did it.” I bet every single one of you who ask that question goes, “My 65-year-old self will thank me for this.”
What are some things your 65-year-old self will thank you for that you have tried and failed at?
There are so many things. Even the first property was not smooth sailing. It had a lot of speed bumps. These success stories that you hear that you’re cracking out of the park on day one, it’s all bogus. Good on the people who can do it. The reality is you learn and it’s not about the money you make in that first deal. It’s about getting your foot in the door. That’s important.
We overestimate what we can achieve in a year, but we underestimate what we can achieve in a decade.
It goes back to what I said earlier, you don’t get to deal number 10 without doing deal number 1. You’re going to learn from every deal that you do. There are deals that I do that I learned a little bit from and a little bit from that. It keeps building that pyramid of knowledge and education that makes me a better investor and entrepreneur. It makes me a better human in terms of realization and rocking up other parts of my life.
If I’m thinking about a specific instance like there’s been so many. I remember the fix and flip deal in Philly. I’m a Structural Engineer. I’ve been building with GCs all my life, multi-million-dollar projects from the London Olympics all the way through to the stuff I was doing in New York. When it’s my own $300,000 property, I still have issues. I still had GCs stealing products from me. I’m finding the GC. He’s not calling out the inspectors to sign off on the HVAC and all this stuff. You have to know that you got to find a solution.
The biggest lesson when you go through these issues is the resilience that you build. The callus on your hands from these experiences will make you better. Nothing has ever killed me. I’m still here to fight another day, but those experiences when I look back, I’m going to do it better next time. How do I do it better next time? I got to reflect on the things that I did wrong the first time.
That’s the power of the mindset because you will have hiccups along the way. Everyone is constantly saying, “I can’t have any hiccups because I’m too mentally fragile for that.” Change that narrative. There might be some along the way and that’s okay because that is life. Life is not linear. It is all over the shop, up, down, backward, sideways, and that’s okay. When you become okay with the worst-case scenario, then that’s going to help you make that decision to move forward and go back to betting on yourself and say, “I can do this.”
Doing deal number one in single-family is one thing. Doing deal number one in a multifamily project is another thing. What gave you the confidence and courage to take down your first multifamily project? How did you raise the money for it?
If we’re going back to the very first deal, it was an introduction. I had my mentor. I moved to LA. I started a once-a-month Thursday pub night real estate happy hour thing. I was still working full-time as a structural engineer. It was a way for me to meet other people. Through that event, I met another young gentleman who was a little bit older than me, but he was working as an asset manager. He had found a great deal in Houston, Texas. This is in 2014, but he didn’t know how to raise the money. I said, “I’ve got this mentor over here that apparently can raise money. You guys should talk.” My mentor was like, “No.” He was probably a little nervous as well. I was like, “This is a pretty good deal. It’s a 7% cap for 2000 build and 250 units.” It was great. 2014 was blood on the streets in Houston. You got to understand the times.
I pushed him again to that and I ultimately went on to form a big company. They have over 10,000 units themselves. I was involved in that first deal. I didn’t raise a ton of money there, but I introduced him to two guys that had gone to be successful. The subsequent deals from that, I raised money for them. How do I do that? I started my podcast and email-building list. I focused on my story because I had a little bit to talk about. That helped me raise my first bit of dollars. I did 3 or 4 deals close syndication before I went out on my own.
That first step when you went out on your own, we bought 192 units in San Antonio. I remember I’ve got a gray patch in the back of my head. My wife talks about that as my real estate gray patch. It was stressful. I remember that we had to buy $6.9 million. I personally raised nearly $2 million myself. My business partner, at that time, raised a bit. We brought in some other people to help raise, my other co-GPs. It was stressful.
One of the groups didn’t perform and we had to pivot quickly. We were stressing out that we couldn’t raise this money, but we ended up getting it done in time. It’s a big leap of faith. I’m sure the question will be like, “How are you going to have that money raise?” It’s all about that gut feeling that we’re going to have to eventually take the big leap of faith at some point because when your back is against the wall and you’ve got a deal on the contract, you will do everything in your power to get it closed. That’s led to more deals from that since then.
I always say that those with the most to do, get the most done. It’s a stupid phrase but it’s like, “We’re against the wall. We’ve got to get this done.” You can’t dither and worry about it. You go get it done. That’s absolutely fantastic. I have enjoyed knowing a little bit of the nuance of your story, especially the mindset and how you’ve used that to grow your company to what it is. The last question is this, when you look into the future and you say, “I want our investment business to look like this in the next ten years.” What does that look like?
If I’m being honest, there will be some iteration of me doing some deals back in Australia. It’s where I’m from. I’ve ground my teeth over here. I think there are opportunities back in Australia. What I’ve learned here, I can reapply in Australia. I think there are fund opportunities to raise money here because multifamily doesn’t exist in Australia as it does in the US. It’s a lot to do with financing.
Probably at some point in the future, I will get out of the operation stage and move to some private equity fund structure. Be the guy in my late-40s or early-50s that is betting on the young 30-year-old that I was back in the day and giving him a go. I’ll always be involved in real estate. There’s real estate across the globe.
That’s the beauty of I don’t have a true marker of where I need to be. It goes back to my statement earlier because the last years have been great. I know if I keep doing what I’m doing for those next ten years, doors are going to open. I’m going to have to walk through it and know that it will work itself out. Enough opportunities have come my way that I can look back and say, “When another opportunity comes up, I know when to take it.” There’s a loose goal right there but in saying that, I’m also trying to be present in what I’m growing now. I’m not thinking too far in the future. I’m just enjoying my journey along the way.
Reed, the final four questions are these. I know you’ve answered it because the first question is, if I gave you $20,000 to invest in real estate with no previous real estate investing experience, what would you do with it and why? You said you may have netted, back of the napkin math, $25,000 or $30,000 on your first two deals.
I’m taking that commissions and all that stuff.
Maybe $20,000. There’s your number exactly. It’s still the first question. Would you do anything differently?
The experience I’ve had to this day, I would not do anything differently. The only thing I would do differently is I wouldn’t put fixed-rate debt on my first multifamily. It’s my big one because I’ve got a huge defeasance on that. We all thought interest rates are going to move. We did the right thing at the time, but having multiple exit options is helpful as you’re trying to grow a business. My only advice to in and around looking backward would be just hedging your interest rate risk for sure, but make sure you can get out of it without paying your arm or leg for it.
Life is not linear. It is all over the shop up and down backwards and sideways and that’s okay.
You answered my first two questions then already. My second question is if you could help our readers avoid one mistake in real estate, what would it be, and how would you avoid it? It sounds like you’ve got that knocked out of the park. Question number three is when it comes to investing in the world, what’s one thing you’re doing right now to make the world a better place?
I try to educate as many people as I can with my podcast. As we are talking right now, hopefully, someone out there is inspired a little bit. I’m a pretty down-to-earth guy if you ever want to approach me and ask me any questions. I’ve been in the struggle and in the W-2 job, trying to get out of it and make a thing for myself.
Giving back in that way. I want to do more as I move out of the operation stuff. I start becoming more CEO-level stuff. That’s in and around some personal charities. I want to give back. Cancer affected my family in a big way so I want to get back in that stuff. Also, being halfway across the world from my current family, I want to spend some more time with them as COVID is keeping us apart for many years. For any immediate future, it’s just trying to continue to inspire people, continue to share my story, and also spend some quality time with my family.
Last question. If our readers want to get in touch with you, what is the best way to do that?
Head over to ReedGoossens.com. If you’re ever coming through Los Angeles and you want to meet up for a beer or coffee, hit me up at Info@ReedGoossens.com. On my website, you can check out the podcast, the books, my portfolio, and all the good stuff. Let me know if you come through LA and we’ll meet up and get on the schedule.
Reed, thank you for your time. I appreciate it.
Awesome stuff. Thank you so much.
Important Links:
- Reed Goossens
- Podcast – Investing In The U.S.
- Rich Dad Poor Dad
- Meetup.com
- Info@ReedGoossens.com
- https://www.Facebook.com/reed.goossens/
- https://www.Instagram.com/reedgoossens/
- https://www.LinkedIn.com/in/reed-goossens-b2a6a933/
About Reed Goossens
Reed Goossens is an Australian real estate entrepreneur, investor, author, public speaker, and an all-around good bloke. Reed got his start in real estate investing back in 2009 and went on to start RSN Property Group, multifamily syndication investing firm which has been involved in the acquisition of over $360 million worth of real estate to date. He also hosts the Investing in the U.S. Podcast, where he interviews top real estate investors to help educate entrepreneurs looking to break into the U.S. market.
