Gen-Z continues his journey of learning about the merits of real estate investing.
Financial literacy is a top priority for students who want to graduate from high school preparing for real-world responsibilities. However, according to a CNBC Report, there are no federal guidelines for teaching personal finance in schools. As some states attempt to introduce legislation to tighten personal finance requirements in high schools, according to a recent Forbes article, many are facing a steep climb to pass legislation. Concerns about the cost of vocational training and the replacement of other courses tend to delay final acceptance.
Without proper financial education, the younger generation faces increased challenges after graduation. A lack of understanding of mortgages, loans, credit acquisition and investment knowledge puts them at a disadvantage in forming a stable financial life. For instance, some headlines suggest Gen Z is less interested in buying a home, but that’s not because they want to rent for the rest of their lives. Instead, they watch house prices rise and feel helpless without the financial savvy to become buyers.
The the average home price in the United States in the first quarter of 2022 was $428,700, a 30% increase over 2020 figures. And commercial properties are even more expensive. The trillion dollar industry is one area of investing that real estate professionals want the younger generation to get involved in. Although it may seem like a market full of buyers depositing large sums of money, some people have learned techniques and strategies without reserve capital and want to teach what they know.
One of these people is a real estate investor Reno Davis. At just 22 years old, he has proven that there is a way to access real estate for young investors without massive cash reserves. He hopes others can learn from his journey to earn a thriving financial life. “I was thrilled to find a path to real estate that didn’t require a lot of capital,” Davis says. “I needed a way out of my situation, and wholesaling real estate was my escape. Today I own my own real estate company and am very successful at what I do, but it takes hard work.
Davis went from a landscaping job to a successful real estate entrepreneur with over 4.5 million Instagram followers. I recently spoke with him about his current role in real estate, the insights gained on his new career path, and how others can follow his path.
Rod Berger: Okay, when we talked earlier, you mentioned real estate as your escape. What exactly did you mean by that? What were you doing before getting into real estate and how did you get there?
Reno Davis: I’m from Miami and we all know how big and competitive the real estate market is. At first I worked as a landscaper, but that started to wear me down in the crazy Florida sun. I was at a point in my life where I knew there was a better way to make money. I didn’t want to spend my time doing hours of backbreaking manual labor. So I decided to explore my options, but I needed something that allowed me to be my own boss.
Real estate was the one freelance opportunity that caught my eye because I saw the potential in the market, especially in Miami, where it boomed with home sales. Once I realized that real estate was what I wanted, I had to find what type of property I wanted to take it.
I started looking for options and came across real estate wholesale. I had never heard of it before and it intrigued me. So I spent weeks scouring the internet, reading everything I could find there. I consumed all the content I could find on Google, YouTube and social media platforms.
Once I understood what it was all about, I decided to invest in myself by buying courses from people who were already successful in this niche. Then, armed with my knowledge of the course and reading all the internet, I moved on to the execution phase.
It took me about a month to get my first wholesale contract, so I knew I could do it. After that, I think I made another deal two weeks later, and it’s been going up ever since.
Shepherd: Describe the wholesaling of real estate a little more. I bet a lot of people don’t know as much as other branches of real estate. Could you briefly explain what this is about?
Davis: Wholesaling real estate involves finding someone who wants to sell their home, making an offer, and then selling it to a buyer. The wholesaler makes an offer to the buyer, contracts it with a buyer at a higher price, and keeps the difference as profit. This is the simplest way to describe the process.
Shepherd: So essentially this is real estate arbitrage?
Davis: [Laughs] Yeah, that’s how it works, and you don’t need crazy money to get started. If the circumstances are right, you could even start with no money.
Shepherd: Tell me a bit more about your network. How did you approach networking in a space where you were new to learning? Were you researching online and meeting people in the real world simultaneously?
Davis: After buying the wholesale courses, they placed their details at the end. So I contacted them, and they were also in Miami. I took a call with them and said, ‘Hey, I’m really into it and I want to get in there. Can you help me get started? Usually they would give me advice on what to do and tell me to get back to them when I got a lead to guide me through the process. That’s how I started meeting them and other people.
Shepherd: I imagine others in this niche don’t do wholesale the same way. How exactly do you operate and how have you scaled it while differentiating yourself in the industry?
Reno Davis uses his age and approach to social media to build his brand and professionalism … [+]
Davis: At first, I was fine with doing the field work myself, but I knew I had to adapt if I wanted to grow the business. I needed help and people. So I got myself a business partner, and we now own an LLC that currently hires ten people to do all the leg work. They handle cold calls, drive to earn money, and post ads all over town for our business.
Whenever they get a lead, my partner and I take care of the rest and close the deal. Then, on top of their hourly pay, we pay them a bonus if a lead they bring leads to a sale. This is how we evolved.
Our wholesale process takes a responsibility out of the house. When we find an ideal property, we put down a minimum payment and then draw up a contract with a clause that it will be void if we don’t find a buyer for the house within 30 days. So basically, no harm, no fault. This has been a successful strategy for us and a big reason why I was able to close over 30 deals myself in my first year.
Shepherd: Quick question. What makes you dollars?
Davis: It’s when you get in your car, drive around your neighborhood, and search for potential homes to land a deal on.
Shepherd: How would you say being in the real estate world has affected you? Are there any traits you have developed from your experience selling a property?
Davis: I live a hectic life filled with chaos daily and do everything quickly. But in this industry, it doesn’t necessarily work that way. In South Florida, it takes a lot of patience for this job. I’m not known for having patience, but I’m learning. I’m always a go-getter who will walk through a brick wall to get whatever I’m aiming for, but wholesale real estate has taught me that sometimes patience is a virtue that yields the fastest results. Ironic, but that’s how it is.
It is important not to confuse patience with lethargy or slowness. You can’t have a lazy mentality in this game. When you’re just starting out, you’re the new kid on the block, so you need to get out there and be loud and heard. Houses and people will not come to you. You need to reach out, send 100 emails a day, and call 100 times.
It’s about staying persistent, personal, and sometimes even ready to be testy. No one will market you but yourself until you grow to the point where you are worth marketing. Wholesale real estate is a hustle and bustle, and you won’t move forward until you take it that way.
Shepherd: Are there any plans for your real estate business in the future? Do you plan to expand into other industry sectors?
Davis: I tried to get into commercial real estate for a while, like buying offices and renting them out to suitors. This is another good way to extract more juice from the real estate value chain.
On a philanthropic note, I plan to start my charity one day to help those less fortunate. I want to start a foundation that donates essential items to the poor and homeless. I’m in the process of developing to complete the mental picture, but that’s the vision. I want to give back to the community in some way.
Until financial literacy develops further into educational models, many young people today will find themselves seeking answers and advice from those who have been successful on their own. Insights gained through social media, available resources, and personalized stories will shape and drive future opportunities.
Reno Davis’ advice for succeeding in real estate is simple: learn from those who have done it before, follow in their footsteps, work at it with everything you have, and scale and delegate as soon as possible.
Like any investment, it involves risk, but Davis leveraged profitable principles to get into real estate by selling entire properties and not buying a fraction of a house, popular in real estate crowdfunding. According to him, there’s a piece of the pie for everyone in the industry, and as he reiterates, “wholesale levels the playing field for people with much smaller budgets.”
Interviews have been edited and condensed for clarity.