Real Estate Business

Turning eBay Profits into Cash-Flowing Rentals

eBay flipping isn’t something new. You’ve probably bought something on eBay that was sold by a reseller. Maybe a type of makeup you liked got discontinued. Maybe your favorite pair of jeans from a nationwide chain suddenly disappeared. For eBay resellers like today’s guest, Tom Brickman (The Frugal Gay), it’s all about finding the products that people love but can’t get a hold of anymore.

Tom is a master of frugality. Raised by a real estate investor, he knew what cash flow could do to a nine-to-five worker’s life. So, at age twenty-one, Tom cashed in some company stock to buy his first multifamily. He inadvertently house hacked and was living in his own place for a whopping $138 per month! From there, he moved from his native Ohio to Texas where he got a full-time job, built his eBay flipping business, and never stopped reinvesting into rentals.

As a side-hustle addict, Tom shares numerous stories about how he made (and lost) large sums of money by reselling on eBay. He even bought an entire house on eBay at auction, which came with bullet holes included. Talk about a deal! Now, retired well before sixty-five, Tom lives a life he loves with his partner, thanks to financial frugality!

Mindy:
Welcome to the BiggerPockets Money podcast, show number 291, where we interview Tom Brickman, the frugal gay, and hear about side hustles, real estate, and flipping products on eBay.

Tom:
I’ve been with that company that moved me to excess for 15 years, I left them just this past January. And if I wouldn’t have done that investing in 2010, 11, 12, 13, I went aggressive from 10 to 15. I wouldn’t have been in that position to be able to leave that nine to five job.

Mindy:
Hello, hello, hello. My name is Mindy Jensen, and joining me today is David. Hip hip hooray from the Military Millionaire Group, podcast mastermind, blah, blah, blah, blah, all the things.

David:
All the things.

Mindy:
All the things. Thanks for joining me today, David. David and I are here to make financial independence less scary, less just for somebody else.
To introduce you to every money story because we truly believe that financial freedom is attainable for everyone, no matter when or where you are starting.

David:
Absolutely, whether you want to retire early and travel the world, go on to make big time investments in assets like real estate, or start your own business, we will help you reach your financial goals and get money out of the way so that you can launch yourself towards your dreams.

Mindy:
David, I am super excited to talk to Tom today. I have been following him on Twitter for a long time, probably six or eight months now. And I love his stories about real estate. I love his stories about flipping products on eBay, that’s actually my favorite thing. Because I am a little bit jealous. I live vicariously through him and his side hustles with the flipping, just because I tried it. I didn’t do well. I didn’t have any method to my madness, I just would buy things on a whim. Oh look, this’ll be great. And then it wasn’t and I crashed and burned, and my $20 investment never went anywhere.
Wow, go figure. So I’m super excited to talk to him and see how he makes it happen.

David:
Yeah, I agree. The eBay stories are phenomenal and some of the stuff that he’s doing is just super unique and super cool. But what I really like is that it shows that you can side hustle with minimal time and minimal capital outlay, it doesn’t take a whole lot to get into this side hustle. And there’s a ton of other side hustles out there, so it just shows that starting anywhere you can absolutely make a ton of progress towards your financial goals.

Mindy:
Yeah, he’s generating income when he wants to. if he decides that he doesn’t want to sell anymore he can just pull everything off eBay for a while. Or if he decides he wants to work more, he can go find more product and put it online. So I really like the flexibility of this side hustle. It does take a little bit of work figuring out what products are working, but he’s got some tips for how to easily figure out what is selling and what is isn’t as you’re at the store. So I think that’s a lot of fun.
Tom Brickman, the frugal gay from Twitter and Instagram. Welcome to the BiggerPockets Money podcast. I am so excited to talk to you today.

Tom:
I’m excited to be here, this is awesome.

Mindy:
Okay, I know that you have a ton of things to talk about because you literally do everything. Real estate and side hustles, and we have a lot to learn from you today. So let’s jump right into it. Where does your journey with money begin?

Tom:
So I would say my journey started around six years old. My father was a police officer. I am the oldest of four kids. My mom stayed home with the kids. So I remember us always being tight from the very beginning. And at six years old, I remember my dad bought his first rental property. He came into a house at the right price, a few blocks over from where we lived. And I thought it was the coolest thing in the world to go with dad to collect rent.
I would go over there on the weekends and paint with him. So that was the beginnings of, oh, real estate’s cool. Oh, you can make money. Oh, someone else is going to pay you to live in your house. This is awesome. And that is where I started and that’s where my frugality came from as well, because my dad. And working with my dad over the years, I learned that he’s not going to fit… He’s going to slap paint on it and not really fix it all the way. So he and I will butt heads, especially now I. He’s way more conservative than I am. And if it’s broke for me, I just want to replace it.
But that was the beginnings. And we always had money but we were always tight. And we took a family of five of us at the time and we drove to Florida when we did a trip one year, and this was in a little Geo Prism, a 1990 Geo Prism. So a family of five in a Geo Prism-

David:
That’s intense.

Tom:
Going from Cleveland to Ohio, down to Orlando, that was a life experience, we’ll say that. I know he’s not going to be happy for me bringing this up, but I bring this up to him often. There was a time where he bought us new mattresses from Sam’s Club, but it cost me to deliver. So we had to go pick them up in his boat because that was the only way we could move these mattresses. And one of them blew out when we were driving home, and it was still a traumatic experience that I tell my friends today.
And whenever they’re like, “It costs $75 to deliver.” I’m like, “Take my money and deliver it,” because I don’t want another boat experience.

Mindy:
I am your dad. My dad is your dad. Oh man. Yeah, we drove… We had a maxi van, which is a regular size van with another seat in the back of it, which is the only difference between your Geo Prism. I’m thinking Geo Metro, which is even worse, but not by much.

Tom:
Geo Prism’s a tiny little Toyota Cam… Whatever the smallest one is, that’s what it was. And that’s what we drove down to Florida, family of five. That was an experience.

Mindy:
Did it have air conditioning?

Tom:
It did. Yeah, it wasn’t a bad car and this was in the 90s so it wasn’t super dated, but it was just a cramped family of five in a tiny car for 19 hours driving down to Florida. And of course my dad doesn’t want to stop along the way because you’d have to pay for a hotel. So that was an experience.

Mindy:
Drive straight through?

Tom:
I think we took little rest breaks along the way, but I don’t remember us stopping at a hotel. Obviously when we got there we had a hotel waiting, but yeah, it was almost a straight shot. I think we did it in 25 hours total.

David:
I’m definitely a car sleeper on road trips when I’m on my own, bu not with a family of five.

Tom:
Try and sleep with a family… Right, the family of five, that wasn’t happening.

Mindy:
Don’t lay on me. Yeah, okay. Okay. So that sounds like super awesome fun. Did you go and pick up the mattress off the road and put it back in the boat?

Tom:
I remember being in the backseat and shrill. I’m like, “Oh my God.” It didn’t hit anyone thankfully. And I think my mom and my dad went out and picked it up. I vaguely remember it was my sister’s mattress, and it was the box spring and it was broke for her whole life.

David:
And you saved $75 on delivery.

Tom:
And we saved $75. And I have a story to tell 30 years later, but it formed me to the frugal gay where I am today. So without these back stories and going to Florida in a Geo Prism and driving down the road with a mattress flying out of your boat, I wouldn’t be where I am right now. So that’s what brought me here.

Mindy:
Okay, let’s fast forward to high school.

Tom:
Okay. So in high school, I went to a private school, my dad paid for that. That was part of… I went to a private school. And when I say private, it was just a Catholic high school, not military school. I got a job as soon as I could. I worked a few odds, cutting… Mowing yards. I worked at a deli. My dad got me a job at a friend of mine, I went and worked for her uncle one summer.
I did all kinds of odds and ends up until when I turned 16 and could get that first real job. And I worked two jobs from 16 to 18 when I went away to college, I worked at a deli and I worked at the Gap. And working at the Gap for 5,15 an hour really laid my groundwork for where I am today, which is wild when think about it. But that job at 15, he filled out paperwork for me and he signed me up for Gap stock purchase plan, which I didn’t even know what it was. I just thought it was a ton of tax.
And all I cared about was buying clothes for cheap because I didn’t want the kids at school to make fun of me. So that Gap stock purchase plan is what I cashed in when I was 21, and I bought my first multifamily property that way. So I didn’t even know I had it until I was 19.

Mindy:
Okay, so you said he filled out the paperwork. Was that your boss or your dad?

Tom:
My dad.

Mindy:
Your dad. Okay.

Tom:
Yeah, I took it home… It was back before everything was digital, I took it home and I’m like, “I don’t know how to fill out all this. Can you help me?” And he whipped through the paperwork, went back to work the next day, turned it in. And that was the beginnings of my Gap… I just thought I would work tons of hours and my checks would be $83, and I didn’t understand why. But that’s how I got my first down payment so I like that part of the story, even though I didn’t have a lot of money to show.

Mindy:
So this is an interesting scenario that I think a lot of people can learn from, especially if they’re young, but even if they’re not. If you think your check is going to be X and it’s way less than X, first of all, that first paycheck that you get, you’re like, “What is FICA? Why is my check so low? I worked 40 hours and I make… I’m old enough to make 3,35 an hour at minimum wage.”
And, “I should have way more money than this.” And you’re like, “What are taxes?” That first check is really shocking. But if you think your paycheck should be X and it’s way lower than X, go through and make sure that you’re getting the right deductions and you’re… Or if you think it should be X and it’s way more. I have had companies where I said I want to contribute to the 401k.
And then the next week I get a paycheck and I’m like, “Why didn’t this go through?”
Oh, we forgot. Okay. Well, go fix it. Because it’s easy to fix that week, it’s not easy to fix six months later or at the end of the year when you’re like, “Wait, I was supposed to be contributing to my 401k the whole time.” And they’re like, “Well, better luck next year.”
So read your paycheck stubs, just like reading your credit card statements and all of those things. But this has a happy ending because you were in the Gap stock purchase plan. How much Gap stock did you have? Did you sell high? Did you just not care and you sold it anyway? When you said, “So I cashed out.” And I’m like, “Don’t cash out.” And then you’re like, “But I bought a multifamily.” I’m like, “Okay, let’s hear that story.”

Tom:
So yeah, I cashed out when I was 21, I had worked at Gap since 16 to 21. Gap also had a tuition reimbursement so I was able to go to college relatively debt free. I paid for a semester… Or I’m sorry, I paid for one class a semester and Gap paid for three a semester, which was awesome.
But when I cashed out at 21 I was in my senior year of college, and it was about a little bit over a $10,000. And that was a perfect down payment on a $90,000 duplex. And that was how I got into real estate. I saw my dad doing it, I knew I couldn’t live anywhere cheaper than that duplex. My house payment was $738. The downstairs tenant paid 600, so I lived upstairs for $138. And where could you live for $138? And that was my mentality back then, was I’d rather pay $138 than have this Gap stock.

David:
Yep, I think that makes a lot of sense. And given the time that you’re in, it’s definitely easy to say, well, Hey, if you left that for the next 50 years it could grow to X. But for one, I look at if it’s a single company I look at that as a little bit more risky over the long term, but also just the fact that the opportunity cost of getting into a real estate investment at an early age or getting into a way to slash your living expenses and then be able to reinvest that money, I think is… That’s huge compared to just having the Gap stock.

Tom:
Definitely.

Mindy:
Okay, so I will approve this stock purchase or stock sale, but you cashed out $10,000. That sounds to me like you might have some capital gains that you have to pay. Did you have a tax bill that you were surprised by?

Tom:
I didn’t because Gap… I think I actually sold when it was down and it was a very, very small tax bill from what it could have been. Because you were buying it at a discount when you worked there and it had fallen, it was one of those where just everything just aligned perfect to sell it.
I did have a small text bill back then, but it was nothing compared to Gap has not split or anything crazy like that.

Mindy:
Okay, so this is what year? 2004?

Tom:
2004, yeah.

Mindy:
Okay. And so where did you move next? You have this duplex, you’re living in the crappy upstairs apartment?

Tom:
I am. I got-

David:
Smart move.

Tom:
I got cocky. I took out a HELOC on that property, and I’m like, “I want to live in Cleveland by my family. I want to go back to Cleveland.” And it’s 2005, and I took out this HELOC and I used it and I bought a single family in Cleveland, Ohio… Well, right outside of Cleveland, Ohio. And I bought it at the top of the market. And I posted about this one a lot on Twitter because I bought it for 85 and I sold it for 52 10 years later. It was just one of those that I had no business buying.
When I went and took out a loan for the third property in 2009, I was horrified by all the paperwork and questions and underwriters and all these things. I’m like, “I don’t understand, when I bought this last house they had me sign a piece of paper and it was mine the next day.”
It was such a seamless, easy process back then. But then it made sense on why there was a financial crisis in 2008, they were just giving loans to everyone who had no business buying properties.
So 2005, I went to Cleveland and that’s… 2006. I took a job with a company that said, we’ll move you down to Dallas for six months for training and we’ll move you right back. And I have been in Dallas for 17 years, so that did not happen.

David:
Perfect, no big deal. Well, it sounds like you at least like Dallas, so.. Or I hope, otherwise maybe you could… I wouldn’t imagine you stay somewhere like a expensive city.

Tom:
Yeah, when you grow up in Ohio and you see all the growth in Dallas and the improvements, it’s like, “Why would I ever want to go back?” Not that I’m doggy on Cleveland, because my family still lives there. I still invest in Toledo, Ohio heavily. But Dallas has been a great market to be in, especially when I entered.

Mindy:
Okay, so let’s look at your holdings. 2006, you moved to Dallas for six months. Did you buy a house in Dallas right away?

David:
Six months going on 17 years.

Tom:
Yeah, going on 17. Exactly. I had to pay off my bad debt because I got credit cards and I had all that. And they’re like, “You want a third loan? Before we give you this third loan you got to get rid of this credit card debt.”
So I took on a part-time job and I just used that money. At that time I took this job in Texas making $33,000 a year. I took a part-time job making, I don’t know, 8,50 an hour. And I just, for a year of working that part-time job, I paid off my $17,000 in credit card debt that I had racked up from 2004, 5, 6, 7. And this was 2009 when I finally… Debt free besides real estate and was ready to buy my first property in Texas was 2009.

David:
Was this… So I know Mindy loves credit card debt. So did you take on credit card debt because you were trying to use it for updating properties, or was this just a time in your life where you were not frugal and enjoyed a credit limit?

Tom:
I was not frugal, but I was… Between the time that I left Gap and between the time that I found this company in Texas that I worked for for the last 15 years, I was doing some… A little bit of eBay flipping and the debts just grew, and I was not frugal. I wanted to have a flat screen TV. I wanted to have a DVD player, all the things that were cool in the early 2000s I wanted.

David:
You did the normal 20s thing.

Mindy:
Okay, so you worked a part-time job-

Tom:
But feel like I kept it under control.

David:
I mean… Yeah.

Mindy:
$17,000. And what was your salary at this Dallas company when you were in 2006?

Tom:
33,000.

Mindy:
Ish.

Tom:
Yeah.

Mindy:
And you had racked up $17,000 in credit card debt. Okay, I was going to be like-

David:
I was just going to say Mindy’s like-

Mindy:
No, because you were making 60,000.

David:
I don’t know if I feel like that’s controlled.

Mindy:
I’m trying to support you, but hey, you paid it off. That is what we are going to focus on, is that you got yourself into debt. Many people get themselves into debt and stay there. So you didn’t stay there, you paid it off. Yay for you. And you took a part-time job to do it.
There are so many people who get their full-time adult job and they’re like, “Well, I’m not going to work part-time because this is my job now. And I’m just going to… I guess I just have debt now.”
And I like that you do what it takes to make money, to generate income so you can go after the thing that you want. You alluded to eBay flipping, which is my favorite part of your story. Because I am jealous. You have made it work. I failed miserably. I didn’t really stick with it. I went to the thrift store, I love thrift store shopping. But I can’t buy everything because my husband’s like, “No, I don’t want a house full of crap.”
So I’m like, “Oh Ooh, I’ll sell it on eBay.” Whatever I was buying people, were like, “No, we don’t want that either. That’s why it’s at the thrift store.” So I have been a horrible failure at my eBay flipping. I want to hear how you flip on eBay and make it successful.

Tom:
So I’ve been flipping off and on since college. There was a store outside of Cleveland, I was home and they were marking down purses when I was there. They were a good name brand, Diesel purse, and they were $1,50. And I remember asking the cashier, I said, “Are these really $1,50?”
And they had them sitting up there next to the register to try and add them onto peoples sales. And I just pushed the cart right up to her and I bought every single one of them, there were two colors. And this was back before eBay even had Buy It Now and I would sell them two at a time, and they paid for a full semester of college.
So that was the origins of the eBay. And over the years I’ve bought duds and I’ve had home runs that I didn’t even know were home runs when I was buying them.
And at some point, I really switched over to eBay with the discontinued makeups, with the bras, with all those types of small, easy to ship items that are inexpensive. Dallas is super central, located for a lot of closeout places to dump their merchandise. So when closeouts happen at all these different stores, they’ll get shipped and dumped right in the center of the country.
And I go out to the flea markets and I can find… You can always go out there and find something. And it’s like you with the thrift store, you can go to the thrift store and find something but you got to get someone else to buy it. And the great thing about the flea market is it’s so inexpensive that when you go and invest $100 on a big box of makeup it’s $100 investment, it’s not like you’re dumping.
Some of the pallets are $30,000 for a pallet, and I see people doing it and being very successful, but I’ve always been way more comfortable with the conservative $100 box of makeup than a $30,000 pallet of electronics.

Mindy:
Okay, you just threw out a ton of keywords that people who don’t flip on eBay may not understand. So first of all, you said, “I sell purses, I sell makeup, and I sell bras.” I don’t know that you are a consumer of these items.

Tom:
I am-

Mindy:
Personally.

Tom:
Definite.

Mindy:
How do you get started in something that you don’t use?
Like I don’t sell jock straps on eBay.

David:
I don’t know that anyone would buy that.

Tom:
You probably could make money.

David:
But you’ve go to go find them at a discount, Mindy.

Tom:
It was just one of those that the opportunity was there. I worked at the Gap so I saw what was selling, what was not selling me, what people were coming in for. So I had the retail exposure, and it was just there was a lot of opportunity there. Are you always going to need a bra? Are you always going to… Those are essentials that aren’t going to go bad. There’s very low risk. They were very low cost items, the bras that I was flipping and I turned into a condo, those were a few dollars originally.
And I had just met my husband and he sat with me. It took us a day to peel all the clearance stickers off of them to get them ready to resell and reflip. But if you have patience, and right before we were getting ready to record I was just talking about these fleece pajamas that I’m buying right now.
Yes, nobody wants these pajamas right now and that’s why they’re five bucks. But you know what? They’re going to be $15 in October when everybody wants pajamas again. So there’s lots of opportunities out there and you don’t have to have a flea market. You can literally go into a closeout store and just start scanning stuff with your eBay app and see what’s selling.

Mindy:
Okay, explain that and then go back to the whole pallet thing.

Tom:
Okay. Yeah, so-

Mindy:
You scan-

Tom:
If you have the eBay app, you can scan anything with a scan bar at any store that you’re at and you can filter it to see what’s selling. And if there’s nothing in that sold category that means that item is something you don’t want. If there’s a ton in that sold category that’s something you want to put in your cart and buy. And it’s easy. It’s just one of those… If you have the eBay app and start scanning, you can walk through any TJ Max or Ross type store and you can fill up a cart of stuff that’s selling, and you can double, triple, you can make some money on some of these items.

Mindy:
Wow, okay. I’m going to go download the eBay app and go zip through and see what you’re talking about. Let’s get back to this pallet of $30,000 of electronics. I know what a pallet is. Can you explain what you’re talking about here?

Tom:
Absolutely. End of season, anywhere from Gap or Target, or any of these big retailers, they’re clearing stuff out. They’re going to bring in the new models. Electronics is really risky, especially because you get a lot of phone cases and phone cases are only good for that phone version and old phone versions. I stay away from electronics, I don’t want anything to do with it.
But I do see people out there who are buying these pallets of end of season stuff and flipping them. I mean there’s a lot of money, and yes, you may spend $30,000 buying one pallet, but you could have 3000 pieces on it. And each piece is X amount of dollars. There’s a lot of money that can be made, especially with older video games, older DVDs, there’s some money there and there’s some people that just feel comfortable flipping that sort of merchandise.

Mindy:
That sounds like something you’re going to need to know about.

David:
I didn’t know that you could scan the barcode with the eBay app. But as we talked about before, I’ve done a decent amount of garage sale and or flea market flipping, one-offs, I don’t know that I’ve ever bought anything in bulk and sold. But I would go through and I would pull up the app and search for it. The barcode would’ve been super cool, but I love that. I actually did a… It was a $1,000 grow your dough challenge in 2019, but it was a couple of different bloggers. We were going to try to see how much they could take $1,000 to over the course of the year, and everyone was doing stocks or whatever.
And I was like, “I want to do real estate, how do I get to where I can put this money down as a down payment?”
And I went the garage sale route. And it was weird because it’s like, I’m only investing $100, $200 a month because spending $1,000 at a garage sale’s actually a lot harder than you think. But I was making… By the end of the first quarter I had $3,500 out of that, and I was like, “Man, if I could just figure out how to get more purchases, there’s actually a pretty decent margin there.” But it’s fun.

Mindy:
So where does one get a $30,000 pallet of electronics?

Tom:
There’s so many different resellers out there. Bulk.com is one, you can buy them on eBay even from other resellers. I always like to try and go as close to the source as possible. So I know when Target is pulling it, who they’re selling it to and I’m going right to who they’re selling it to.
Because a lot of times it gets so watered down and cherry picked that when you get that $30,000 pallet, you could probably sell it for about 30,000 but there’s not a lot of profit. And I don’t want anything that’s been cherry picked through with the shelf poles.

Mindy:
Okay. Yeah, you want the good stuff right off the bat. So this is really interesting because I never had barcodes to scan and I clearly didn’t know that that was a thing.
But it seems like that would be a lot easier but you’re also maybe paying more or maybe not paying more because you’re at… TJ Max has some really high-quality stuff just marked down, sometimes really, really low compared to the original price. I remember there was a gorgeous leather Armani skirt and it was not my size, and I was like, “I’ll diet to get into it. It’s an Armani skirt, I should totally buy this.”
But it was normally, I don’t know, $2,000. I don’t even know why it was at TJ Max but it was $30. And this was… Well, I don’t know if this was eBay time or not, but it was like, this is such a low price. Then again, would I pay $30 for a skirt? No, I’m too cheap for that. But $30 for a leather Armani skirt I’ll pay for. I don’t know, it shouldn’t matter but it did.

David:
Sounds like a good profit margin though if you flip it.

Mindy:
Yeah, I could have flipped it if I only knew all of these things. Okay, so you mentioned that you have some-

Tom:
I sell leather skirts, that’s one of my items that I sell. And I actually… It’s crazy that I sell a lot of them, but we do. And it’s a huge profit margin on them.

Mindy:
Do you have mostly women’s wear and women’s items that you’re selling, or do you sell men [inaudible 00:27:42]?

Tom:
I sell men’s stuff, but it doesn’t sell like the women’s stuff and I can’t get it as cheap. So the leather skirts I paid two bucks for. The men’s shorts, I paid six bucks for. And when I sell those leather skirts I’m selling them for 60. And when I sell those shorts I’m selling them for 40. So I’m going to go more with the leather skirts for $2 and sell them for 60 bucks versus the $6 shorts that I sell for 40 bucks. So I sell both, but the women’s stuff tends to sell a lot better.

Mindy:
What doesn’t sell well?

Tom:
Seasonal stuff, anything Halloween or Easter. You have a tiny window to sell it and if you don’t sell it in that window you’re going to sit on it for another year. And other end of season, like when the phones phone cases don’t sell well because you’re always upgrading your phone. And if you get stuck with a bad batch of older phone cases you’re going to be sitting on those.
So I’ve had that. I’ve had candy before that I bought a pallet and it had all candy. Nobody wants that. So I just donate it in those cases, when you get stuck with something. Or I bundle. When I can’t sell something… I just was posting about I bought these Elizabeth Arden makeup bags. I filled them with all the stuff I couldn’t sell and then I sold the makeup bag for 10 bucks. So I didn’t make any money but I didn’t lose any money. I got rid of my excess, and that’s… I’ve been really big with bundles. When I can’t move it I’ll bundle it with something that’s good. And those tend to sell a lot better.

David:
That’s actually really smart, I like that.

Mindy:
That is, I’m thinking inventory management, because that was going to be my next question. Where do you store all this stuff? You’ve got 500 houses, which we didn’t even talk about yet. But not 500, but you’ve got a bunch of houses but they’re all rentals. Do you have any warehouse space?

Tom:
I don’t. I own a retail space with storage space but I don’t use it. I rent it. And I had a 400 square foot guest house in the back of my house, and if I can’t fit it in there, I can’t buy it. That’s the rule of thumb in our house.
And it did overflow into the house at some points, especially during the holidays when I was going crazy and we’re shipping 20, 30, 40 things a day, but we just moved. And I got a two car garage and a storage shed. And once those are full, that’s my storage and that’s where my… I’m not going to spend extra money for the storage units because I’m not there. But I’m good with where I’m at.

David:
So I love this because people are always talking side hustles, it’s a buzzword. Everybody, “Oh, side hustle.” And people will go… I hear a bunch of excuses for why this side hustle won’t work or why that side hustle won’t work. And the reality is this just goes to prove that you can literally make money doing anything. You are buying products that you don’t use at a discount and selling them and making a massive profit margin, and you are not tied to… A lot of these side hustles are still tied to your time, you have to spend three hours driving for Uber to make the… Whatever, this is on your schedule. I love it.

Tom:
100%. And I was working with someone, he wanted to start small. His comfort level was Walmart. He went into Walmart last summer, he bought a bunch of clearance toys. He sat on them for a little bit. And then in November… And by the middle of December he sold everything. And he sold enough toys that it paid for everything that he bought for people for Christmas. So that was his goal. He wanted to be able to do a free Christmas. And just by buying the… I think he invested two or $300 in clearance toys. In the summer, he turned that into $1,300 in the winter.
And yes, he had to go to the post office and ship them so there’s time in there, but he was able to cover all the rest of his holiday expenses just by holding these toys for a certain amount of time. And timing is half of the deal when you’re flipping, is those toys were worthless to people in July but people certainly wanted to put them under the Christmas tree in December.

David:
Well, depending on what you’re buying and the size obviously, that’s going to change your packaging. But the USPS will send you free envelopes and free boxes in bulk. I think I have 100 sleeves and then I just log in and click print, and I can ship a book or whatever. And I will just have four of them and just walk by the post office and drop them off. So there’s ways to streamline that, for sure.

Mindy:
So what’s your biggest challenge with this eBay flipping?

Tom:
Okay, for eBay flipping it is… There’s a few different challenges that go with it. There’s sometimes where you just get some people that are just unpleasable. I will refund an item even though I know that there’s no defect, just because I want to avoid the negative feedback. The streamline of merchandise has not been an issue, because whenever I’m running out of that good item, I’ll go spend a weekend out at the flea market and I’ll find… I’ll scan and scan and scan and find… So I haven’t had a problem.
And then the other thing is holding the merchandise. Those shorts that I bought for men I’ve been sitting on since last winter, and now they finally started selling this winter because I’m selling the shorts off season. None of the department stores have shorts right now. So people are buying shorts for cruises, for vacations and whatnot. So it’s holding it, and when is the right time to ditch it? When is the right time to just say, I’m done holding this, I just want to donate it and get it out of my inventory.

Mindy:
Okay. So this begs the question, because many people who listen to this show are money nerds and keep a spreadsheet since the dawn of time of all of their spending forever.
Do you take inventory and keep track of what’s selling and what’s not? And when’s the right time? And being in retail, I worked in retail and there’s the summer season, the fall season, holiday one, holiday two, you’ve got all these… Where holiday one is you’re selling bathing suits for people that are going to the Caribbean when it’s warm, where it’s warm when it’s cold by you. So you walk into the department store and you’re like, “Why are there bikini’s everywhere?” Because people are buying them.
Do you keep a retail mindset as well? Or do you keep track of when you’re listing things?

Tom:
We have a small system like what you did in retail, but it’s usually like… I was going to donate all my winter sweaters that didn’t sell after this last Christmas, but I ended up selling 37 of them this year round. So they sat on eBay for over a year. The only cost was me storing them. But now after this last one, we went ahead and donated whatever hadn’t sold.
So yes, I have a, okay, it’s sat here for long enough. Sometimes I’ll sell stuff with expiration dates, when it’s close to the date I’ll just bundle it, throw it in something, or donate it because I don’t want it to go bad sitting there waiting for it to sell.

Mindy:
What do you sell that has an expiration date?

Tom:
Deodorant.

Mindy:
I didn’t know deodorant had an expiration date. Where do you get deodorant?

Tom:
There are-

Mindy:
Like clearance?

Tom:
There’s a closeout-

Mindy:
Clearance deodorant?

Tom:
There is a lot of money in discontinued scents of deodorant. It doesn’t even make sense, but they’re like, “This scent works for me and this scent doesn’t work for me.” So they will spend more money buying these, and a lot of these places, these big companies will donate their end of season or their production stuff. And when you have that right scent, I was shipping deodorants left and right last summer. And I wouldn’t do it again because half of them melted on the way to the people. If it gets too hot the deodorants going to melt.

Mindy:
Oh yuck.

Tom:
But there is a lot of money in these discontinued colors, discontinued scents, discontinued cuts of jeans and that.

Mindy:
Now that I would believe, because when you find a pair of jeans that fit. Oh, when I find a pair of jeans that fit, I go back and I buy 10 because I will not find another pair. And you’ve got to wear them and wear them in, so you’ve got to rotate them through.
What has been your biggest surprise, holy cow, I can’t believe this sold for so much, like win?

Tom:
I bought a storage unit from a friend and he had a lot of discontinued scents in there that he was buying from department stores when the box would get ripped or the lid would break. And he had cases and cases of this cologne, it was called Good Life. It’s made by the same people as Cool Water. And I’m just like, “Oh cool. I can probably get 20 bucks for these, I’ll list these. They’re all wrapped, in good shape.”
And they even had samples in there. And I’m like, “Oh, this smells good.” And I have been selling those, I’ve sold all the colognes for $250 a bottle and I’ve been selling the little samples for $22 a piece. And I had cases and cases of them, so it was just something I never would’ve thought of. And then I just decided… And it was like that off chance, like, “Oh, I should check this out and see what this is.” And I missed one of them.
There was a case of men Candy’s cologne that I threw away. And then after the fact I found one bottle and I looked it up, and I’m like, “Oh my God, they’re selling for $87 a bottle and I just threw all those away.”
But it was just one of those, I would’ve never thought to even look it up until I was standing there. And I just did it on an off chance.

David:
How much did you pay for the storage unit?

Tom:
A little bit over $1,000, and if you saw the amount that came out of the storage unit. And this friend had lots of storage units and we bought a lot at the same time. If I would’ve done it right I would’ve bought one at a time and really processed the merchandise. Because like I said, I threw away things like a case of Candy’s cologne that I thought had no value, and I’m just glad I didn’t throw away the cases of Good Life cologne.

David:
Man, that makes me feel like… So my biggest win which is totally not replicable was I got a printer for 50 cents and I was able to sell it for 80 something dollars. And the return was something 10000% or whatever, but it’s not a huge chunk of change just a large percentage ROI.
250 a bottle, that’s an awesome return. Who cares about the percentage? A couple cases of that, you sell four, you break even.

Tom:
So what I was doing was I was turning around and using all these profits and I was buying properties with them, and I was buying the properties that everyone was ignoring in Texas. And that’s really how I started going. After 2009 and 2010, 2011, I was buying at least one or two a year, and I was using this eBay money or whatever money I could generate to buy them. And investors didn’t want condos back then.
And just last year I sold a $15,000 condo for $97,000 and I turned it into a multi-family property in Ohio with it. So that’s where I really grew like crazy and that’s where I made this business big enough that I could leave my nine to five.
I’ve been with that company that moved me to Texas for 15 years, I left them just this past January. And if I wouldn’t have done that investing in 2010, 11, 12, 13. I went aggressive from 10 to 15. I wouldn’t have been in that position to be able to leave that nine to five job.

Mindy:
So you bought pallets full of discontinued merchandise, sold it on eBay, took that money and simultaneously bought more merchandise and properties that you rented out, and then sold the properties that you rented out. And 1031’d them I’m assuming into properties in Ohio?

Tom:
Yes. Yeah, I’m a big fan of the 1031 exchange. I’ve turned lots of properties that I bought early on in Texas into much bigger… I bought a commercial space with a 1031 exchange for another property. I couldn’t have got that financed if I didn’t… I found financing, like nontraditional financing, because at the time it was super distressed. But if I didn’t listen to BiggerPockets I would’ve never been able to get that completely financed because a bank wouldn’t touch it.
So I was able to network with the community just from listening to the show and going on the message boards, and I found financing that way. So I got creative along the way and I used my nine to five money to buy my merchandise because I had extra money from that. Because I always house hacked, I always had a roommate paying my bill. I always had a tenant paying my mortgage. And then the money that I made is what I used towards my real estate.

Mindy:
How do you look at a piece of property that is so distressed a bank won’t touch it, and say, “Oh yeah, I want to take that on.” A lot of people will pass on that. The reason that it was available for you is because it was so distressed and the bank wouldn’t touch it. And people are like, “No way, if a bank doesn’t want it, I don’t want it either.”
How do you determine that it’s going to be a good property versus a complete and total disaster?

Tom:
And I’ve had disasters over the years. I bought a crack house on eBay, which we can touch on, but I look at, does it have good bones? And that commercial space was in a sweet spot, and it was just so distressed and so ignored, but it had good bones. And when I had an inspector go through it, they’re like, “This place is solid. It just needs completely updated. It needs a new furnace. It needs a new roof, it needs this,” but the bones were there.
And even with the condos, when I was buying these 12,000, 15,000, $21,000 condos, the complexes were well-kept. It was just the HOA owned some of them, they were just distressed, forgotten properties, but they were in a good spot or a good location. And that was my key. If I go into a property and I’m like, “I would live here,” then I’m going to buy it. If I go into a property and say, “I would never live here.” And I have bought those before where I’m like, “I don’t feel comfortable here.” And those are the first ones that I always sell.
But you got to look at, how are the bones? How are the neighbors? What’s going on around here? And then go walk around and talk to people. I’m taking out trash at a new place and I’m just talking like, “Hey, what’s going on? How long have you lived here?”
Talk to the neighbors, see if they would want to live here. Would they want to rent? Do they like living there?

Mindy:
Okay, let’s look at this commercial property specifically, you said it needed a new furnace and it needed a new roof. What did you pay for this property? And this sounds like this was your first commercial property?

Tom:
Yeah, that was the first commercial. That was in 2018, I believe, or 2019. And it was really, really, really poorly listed. It was a four unit, three residential, one commercial space. The commercial space could be split into two so it was technically five on paper, but we just left it how it was.
And it was poorly, poorly, poorly listed, poorly marketed, poorly advertised. And it was 85,000. And then it got reduced down to 75. And I kept saying to my friends, I’m like, “Let’s go look at this. Let’s go look at this. Let’s go look at this.”
They went, they’re like, “Yeah, this is solid and a great spot. And 17,000 cars drive down that road in a day. Let’s try this.”
And I put in a cash offer of 65 and they’re like, “No, we’ll do 70.”
And we’re like, “No.” And then they came back and they’re like, “Okay, we’ll do 65.” So that was how that deal went.

Mindy:
And what does-

Tom:
And so to date, I’ve invested about 40 into it. I did about 10,000 each unit between the roof, between the furnace, between updating… They have some Ikea kitchens in there, and it appraised for 200,000 this past year. So I’m 105 in and we’re 200,000 on the property now.

Mindy:
And it cash flows.

Tom:
They were making so little rents it was insane. But in 2020 we collected over $30,000 in rent from that place alone.

David:
With a whopping probably 6,000 in mortgage payments. That’s a huge margin for maintenance and expenses. I love it.

Mindy:
Wow.

David:
And that’s the magic. That’s the magic, people get turned away by properties that look and or smell terrible. But if the bones are good, the profit margin is huge. We’ve got one right now that there was a grease fire in the kitchen, the kitchen was the only thing that was damaged. There was maybe a door had some heat damage, the rest smoke damage.
You got to pull all the drywall out and whatever, lots of big updates. That thing, you’re set for three or four years and we’re going to probably turn a $75,000 profit on the flip. Yeah, it’s huge. But like you said, the bones were good.

Mindy:
Yeah, you can…

Tom:
And some people lack that vision.

Mindy:
There’s no problem that is too big you can’t throw enough money at it to fix. It’s just how much money are you going to throw at it? And you could have bought another property for 65,000 and put in 400,000 to get it worth 200,000, that’s not a good property. Don’t buy that one. Buy this one instead. The cash flows all day long.
There are some properties that don’t make sense at any price. There are some properties you would have to pay me in order for this to be a good deal for me. You don’t have to buy those properties, and this is why you need to run your numbers and get used to running numbers. And I think they say on the BiggerPockets Real Estate podcast, they talk over and over about getting comfortable running your numbers. And when you’re first starting out, analyze properties. Analyze properties every single day.
You had a really key point about this property that I want to highlight. You said it was poorly marketed. I’m seeing right now in this market, I’m in the Denver market, it is the hottest market I’ve ever seen in my whole life. And I’ve been in real estate since before both of you guys were born. And it is insane out there, I’m watching prices climb every week.
I had a client who put in an offer and got it at the beginning of February, by the time we closed at the beginning of March, she already had like 50 or $75,000 in appreciated value on this house. I’m going to do air quotes because I can’t believe this market is so ridiculous, but I digress.
You said it was poorly marketed. We are looking for another property for this client, and we found one and it was poorly marketed. I couldn’t believe how poorly marketed it was. Somebody swooped in and got it for another 5,000 more than we paid for it probably. The listing agent wouldn’t tell us anything about the other offer, but he said that it didn’t hit 800. And we were real close to 800 so there wasn’t a lot of room to move.
But anyway, it was poorly marketed. It had horrible pictures. It had no pictures until Saturday, and the description was terrible. It was way overpriced for the market or for the area if you don’t take into account that it’s like three times bigger than any other house there. It was going to be a great house. And it was totally outdated, it was kind of ugly. But you can fix all that stuff and you can… It was a three bedroom with a huge loft upstairs, two walls and a door and you’ve got four bedrooms upstairs, which is hugely more valuable than a three bedroom house.
And it would have been… I was calling everybody I knew, “Can I pay you to get out there and build two walls and a door for my client?” Because this would be such a great investment for her. And I’ve got the agent, I’m sending him texts every day. “Hey, if your deal falls through we’re right there. We can close in two weeks.”
But look for the poorly marketed ones. We’re going in now on… Everything’s going under contract on Sunday or Monday, go in on Tuesday and see what’s still there. Click through the pictures and look through, oh, those are horrible pictures. Or, Hey, that’s a… Some of the houses on the market on Tuesday are there because they’re horrible. They back up to the train and the busy… Across the street of the gas station, but some of them were just overlooked and there were better houses on the market that weekend so everybody went and bid on those houses.
But there’s still properties that are falling through the cracks even in this market. So look for the ones that are poorly marketed. This was the five unit that was advertised as a four unit, look for ones that are… Oh, it says it’s a three unit. I found a listing that had zero bathrooms. You can’t have a house with zero bathrooms. I don’t know if you guys know this, but it has to have at least one bathroom in order to be a house.
So before I reached out to the listing agent to correct him on it, I clicked through to make sure that it wouldn’t work for one of my clients. Because if you have a listing set up in the MLS or if you have a search setup where you’re looking for a minimum of one bathroom, well, this isn’t going to hit it. You’re not going to see this house.
So I clicked through, it was not going to work for any of my clients. So I reached out to the listing agent. I’m like, “Hey, you have this listed as a zero bathroom house. You may not get the traction that you’re looking for on this.”
But have way open-ended searches. Don’t look for a three bedroom, two bath between 550 and 575, look for a… If you need three bedrooms, look for a minimum three bedroom but don’t put bathrooms in there. And go on up to 770 or 575 with no minimum, sometimes you can get something on the bottom end that is interesting or mislabeled or… There’s a lot of mistakes on the MLS, even in this market.

David:
You would be amazed. I think letting somebody take pictures of your house with one of these, a cell phone for those of you on audio, is probably the most costly expense when it comes to selling a house. I would wager that in a lot of cases, your photos, if done poorly, will cost you more than the 6% commission you pay to the agent and closing costs combined because you’re just not… Nobody’s going to look at your house. There’s not going to… You’re going to miss out on the competition.
And it astounds me that there are, I don’t want to say agents who are lazy, but I’d imagine it’s probably less just more that they are… They’re novices maybe. But that you would let something go to list in a market this hot without professional photos that cost two or $300 is just mind blowing.

Mindy:
I will say that you can take good quality pictures with your cell phone. The iPhone has really great… The newest iPhone has a great camera. I have my husband take all the pictures for my listings because he takes really great pictures. I don’t do a lot of listings and I tell them up front, look, we can pay for professional photography or my husband can come in and take these pictures. He’s going to be here several times throughout the day because some rooms look better during the day and some rooms look better at night with the lights on on the inside. So he’s going to take pictures of the whole house in both times, and we’re going to see what works best.
And those are the pictures we’re going to use. And I don’t care if the kitchen is dark in the listing and the backyard is all light, nobody cares. They just want to see what the house looks like.
But yeah, we take good pictures, and if you can’t take good pictures yourself then you should absolutely hire it out. But yeah, you click through and you’re like, “I can’t even see.” And for the love of everything that is holy, close the toilet lid before you take a picture. The end.

David:
Yeah. And then you’ve got the whole organization of the photos too, it should be how you walk through the house.

Mindy:
Thank you.

David:
Instead of like sometimes you open a listing and it’s like, oh look, a closet is photo one. Wow, such a cool closet.

Mindy:
Yeah, and if you can’t figure out the way that the house is laid out from the pictures, sometimes that’s on purpose because the house is weird. Sometimes that is because somebody uploading pictures didn’t do it right.
So definitely click through and take the time to see what’s there. And if it’s confusing to you it’s going to be confusing to a lot of people. In this market there is hot, hot frenzy every weekend. So if you see a house that looks gorgeous and you’re looking for a deal, don’t go view that house that looks gorgeous. It’s not going to be a deal.
Look for the weird houses, click through the pictures that are, oh, it’s a kitchen. The next picture is a bathroom. Is there a bathroom off the kitchen or is this… And then there’s the backyard. And then there’s no more pictures.
Go see that house, that’s going to have far less people scrambling to get in. That’s going to have more people overlooking it or being like, “Nah, I don’t like it. I want to see a different house.” And you don’t want the competition, you want to get in and be the only offer. When we made this offer in February, we were the only offer on this house. Whereas there was another house around the corner that got 16 offers and bid up 150,000 over list.
We offered on that too but we didn’t get it. And we’re like, “I can’t believe there’s no other offers on this. We’re going to put a really tight acceptance deadline on this, just because we either want to get it under contract or we want to go someplace else.”
And it was a great offer, we weren’t trying to low ball them or anything. But some things just fall through the cracks, but you’ve got to look, you’ve got to be in the market right now, analyzing deals and really jumping in to see. You’ve got to know your market, and poorly marketed is your best friend.

David:
All right. I called dibs on this earlier so I’m asking, tell me about the crack house on eBay.

Tom:
Crack house on eBay was I had money in my account, and I’m sitting at work and I was familiar with the zip code. I was not familiar with the street. I texted my friends up in Toledo, Ohio and said, “Hey, can you drive by?” And one of my friends is finally like, “Yeah, I’ll go on lunch.”
And at that point I had already won it because it was one of those where it had two hours left, it was auction.com fulfilled by eBay. And my friend went by and they’re like, “It’s rough, but I think you can make it work.”
And I thought it was a different neighborhood than what it was. I sent my husband, he was my boyfriend at the time, and my dad to go look at it once I closed and paid all my money for it. This was a 13,500 house.
And I originally told my husband, “I’ve got utilities on, you can stay there the night. Just take a sleeping bag with you.” And when he got there there were bullet holes in the doorframe. There were bullet holes in the dining room window. And then my dad started sending me pictures of syringes in the bathroom. And I booked my boyfriend a hotel down the road and he didn’t have to stay there. And then my dad’s like, “I’m just going to walk away from this one, just lose the $13,000 and be done with it. Don’t even mess with this house. We are scared to be over here past six o’clock.”
And I’m like, “Is it really that bad?” And it was. My contractor, while he was working.

Mindy:
Your dad’s a cop.

Tom:
Trust me, and that’s why he’s like, “Just walk away from it. It’s scary.”
But true story. My contractor was inside working, and there was a drug deal going on in the backyard of my property, a kid got shot while my contractors in there.
And here’s the end of the story, which is my favorite part. It finally ended in July of 2021. I did pour a ton of money, it got an Ikea kitchen, it got a new furnace, it got a new roof, it got lots of improvements. So I was all in at $38,000 on this property, which is way more than what I wanted to spend. But I sold it in July of 2021 to my tenant. I owner financed it because he couldn’t get traditional financing, and he is happy there, it’s the nicest one on the street. It’s well-kept, he’s taken pride in ownership. And he’s current on his payment so it was a win-win on both sides.
So I probably should have walked away and listened to my dad and listened to my boyfriend at the time, but it still turned out okay. It just took a couple years to get over the finish line.

Mindy:
Do you buy houses on eBay anymore?

Tom:
I do not buy houses on eBay. I do not buy houses in that zip code anymore. I’ve learned my lesson. I did buy a side lot from the city. The property next to mine was torn down. They sold me a lot for $150 just if I would mow it, and I’m like, “Yeah, I’ll mow it.” That increased the value, why would I not buy a piece of land for $150? So it was a learning experience, that’s what I’ll say about that purchase.

David:
But ultimately you came out all right and you learned a ton. And I think you definitely said a key… I think the key there was when you were like, “Oh, I was familiar with the zip code, but not the neighborhood.” And I’m like, “Ooh, I know where this is going.”

Tom:
I even lived in the zip code, so I’m like, “Oh, it’ll be fine. I used to live in this zip code. I know this store’s right there and that.” But no, it was not the right… And it was really broken down by streets, you could go one street over and it’s nice. You could go one street to the left and it’s nice. It was just a really rough street. And you learned as you go.

Mindy:
That reminds me of the Mark Twain quote, a man who carries a cat by the tail learns something he can learn in no other way. Sometimes you just have to learn the lesson. And yeah, I think it’s sounds awesome.
Oh, look, here’s a house for $13,000. But then yeah, sometimes you just have to… I bought a condo and I learned that I don’t ever want to buy condos. And I’m so glad that you had success in your condos, but I did not.

Tom:
I’ve sold almost all of them at this point, but they got me where I wanted to go. And I hold a couple of the three best ones that are in the great A class neighborhoods, but no, not a condo fan either. I would not want to… I’m never looking actively for condos.
But in Dallas where there’s not a ton of single families, and the investors were crazy for the single families, I had to go for what everyone else was ignoring. So that’s where I started.

David:
I feel like that’s like a transition for a lot of real estate investors, is you start out a lot of times you’re looking for that 2% rule, that house that needs a ton of work. You’re going to put a ton of sweat equity. You might deal with a crappy tenant, all these things that could go wrong because you are trying to leverage into a return to get yourself off the ground.
But then as your portfolio grows, you start to get to this point where you’re like, “That one’s more stressful than the other ones, that’s got to go.”
So I’m at that point in my portfolio now where I bought a bunch of things that were… They cash flowed great, they appreciated great. They were good properties from a financial standpoint but they were headaches. And so it’s like, “Okay, if I can get rid of that headache and move it into something that might not cash flow is great, but doesn’t call me. Great.”

Mindy:
And you learn so much by dealing with the headaches. Sometimes you’re learning like, oh, this is a fix that I need to now make when I buy a house. Or this is a thing I need to make sure is top notch when I buy a house. Or this is a problem with a tenant that I overlooked during screening that I need to… You should always be learning from these head headaches, but yeah, you can get rid of the headaches too.

Tom:
100%.

Mindy:
1031 into a really good property.
So we could talk for another 17 hours about all the things that Tom has done, but we all three need to get on with the rest of our day.
So I want Tom to come back later on down the road and talk to us about 1031 exchanges and some of these other fun, more advanced real estatey topics that we’ve had.

Tom:
Anytime.

Mindy:
Or experiences that he’s had.
But Tom, we’re not done with you just yet. We still have to do our famous four. Are you ready?

Tom:
I’m ready.

Mindy:
Okay, Tom. What is your favorite finance book?

Tom:
Favorite finance book is Tim Ferris, A four hour work week.

Mindy:
Okay, that’s a good book.

David:
Tom, what’s your biggest money mistake.

Tom:
Biggest money mistake would have to be purchasing a house in 2005 at the top of the market and trying to make that work in a neighborhood that I had no business being in. I had no team built. I had no support there. So I lost money on it all 10 years that I owned it and I lost money on it when I sold it, so I carry that one as a learning lesson.

Mindy:
I’m sorry. I’m not laughing. I’m laughing at the way you phrased that. I lost money all 10 years that I owned it and I lost money when it sold it. But you learned.

Tom:
I did.

Mindy:
Did you learn a lot?

Tom:
I did, and it’s a good story to tell people when they’re like, “I want to be in real estate.” I’m like, “Well, let me tell you this story.”

Mindy:
Okay. Tom, what is your best piece of advice for people who are just starting out?

Tom:
Get rid of the bad debt, obviously. I’m a huge debt free advocate. What can you do right now? And there’s so many people that are so far into debt but want to be in real estate today because they want to start earning money, so start working on that debt.
But then also can you get yourself a $15 pack of business cards that you can pass out to people so they know that you’re interested in real estate so you can network? Because building that network even before you have that money is awesome, because then when you are ready, you already know that that plumber can do that job for you.
You already know that this person is in real estate and you can call them about this. So go spend the $15 on the pack of business cards and pass them out. Just introduce yourself, say, “Hey, I want to get into real estate. I’m paying off debt right now but I want to be there.”

Mindy:
I wrote an article called do ask, do tell. Your secret weapon for landing deals. And it was like, tell everybody that you know what you do. The moral of this story is you never know who knows anybody who is about to sell.

Tom:
One of my best deals came from a man at the flea market who I bought nail Polish from. And he’s like, “This is my mother-in-law’s house. I don’t want it anymore.” And I’m like, “I want it. And I bought nail Polish from you for a quarter, so here’s my business card. I want the house and I want the nail polish. Let’s do this.”

David:
I love it. But you’re not wrong, it comes from just telling people what you want, what you’re looking for, networking. It’s everything.
Oh, that’s powerful.

Mindy:
Yep. I buy real estate, do you know anybody who is looking to sell any property? I’m interested in buying. And I lived next door to a duplex. I was very friendly with the lady who lived in one half of the duplex, and she comes to me and she’s like, “Oh.”
There was a sign planted in the yard one day, and I come home and I’m like, “Jude, you didn’t tell me that they were getting ready to sell.” She’s like, “Oh yeah, I remember that you buy real estate. Yeah, he told me he was going to sell it.”
It sold for 240. That guy just had to sell it because of a divorce. He sold it for 650 6 years later. And I’m frustrated because I would’ve kept it. Do ask do tell.

David:
All right. And now the question that everybody eagerly awaits on every show, what’s your favorite joke to tell at parties?

Tom:
So I don’t have a joke, but I tell a story about my first experience with Texas. My company gave us Texas State Fair tickets and I went, and I didn’t know anything about the state fair. And I’m just trying to use the food tickets and the ride tickets and go home. I’m in a bad mood. I paid $20 to park at a gas station. I have no idea really what’s going on. And I’m standing in line at this swing ride, and I’m just like, “Oh my God, how many more rides do I have to go on to get rid of these tickets and go?”
And then it hit me. And there were girls standing behind me, they were singing. And there were girls standing in front of me and they were dancing around. And someone on the ride threw up on all of us and I just started to cry at that moment. And I ran across the entire state fair to try and find my car at a gas station. It had been towed.
So it was like a perfect welcome to Texas. This is what Texas is. So whenever I get asked, “Do you want to go to the state fair?” I tell that story. And I don’t go to the Texas State Fair anymore. And it got in the mouths of the girls because they were singing the songs, so it was way more traumatic for them. It hit me on the shoulder, but it was again, I don’t go to the state fair of Texas anymore.

David:
Not a joke but definitely something worth laughing about. That’s terrible

Tom:
One and done, yes. I learned the hard way on that one.

Mindy:
Okay, I have an eBay related joke for you. I just sold my homing pigeon on eBay for the 23rd time. It’s more of a homing pigeon joke.
I’m selling all of my John Lennon collection on eBay. Imagine all the PayPal.

Tom:
Oh, so good.

Mindy:
Okay, those were terrible.

David:
As I said, the most anticipated question on the show.

Mindy:
Tom, where can people find out more about you?

Tom:
So I’m super active on Twitter @thefrugalgay11, and on Instagram I post renovation picks, I post eBay flips. I’m pretty active on there, so if you guys want to connect those are the two spots to definitely hit me up.

Mindy:
And what’s your Instagram account?

Tom:
Same thing, @thefrugalgay11, @thefrugalgay1 was already taken So I have to be @thefrugalgay11.

David:
11s a good number.

Mindy:
Okay. One one.

David:
Probably my favorite number.

Mindy:
Tom, thank you so much for your time today. This was super fun. I learned a lot about eBay flipping. My husband is not going to like this episode because he’s going to be like, “No, you can’t do that.” But now I want to go find these pallets of stuff and find some $2 skirts that I can sell online. And I’m not going to do it but I want to, I dream. So thank you for sharing your story today.

Tom:
Thank you for having me guys, this was a lot of fun. We finally made it happen.
Thank you.

Mindy:
Okay, we’ll talk to you soon.
Okay, that was Tom Brickman and his fabulous story of selling random things on eBay to generate income, to buy houses that generate more income, that allow him to quit his job and sell more stuff on an eBay to buy more houses.

David:
This is truly doing everything the right way. It’s funny to say that, like selling makeup and bras and purses is the right way. But the reality is the right way is to find some way to either save more money or make more money, and then to not touch it except to invest it.
And that’s what he did. He makes more money, he buys an investment. And then he takes those investments and rolls them into new investments. And that’s the way you build wealth.

Mindy:
And he’s built wealth. He has… We didn’t get to his final tally, but he has 16 or 17 doors that are generating enough income for him to have been able to quit his job earlier this year and still be able to buy more real estate. He is just cranking out his investments, and it’s just a really fun story. Because now he can work as much or as little as he chooses. And that is really the whole point of this financial freedom thing, is to build the life that you want.
He’s not beholden to a job. He doesn’t have to work anymore for anybody else. He can do what he wants with his days, and that’s exactly what he’s doing.
Okay, David, should we get out of here?

David:
Absolutely.

Mindy:
From episode 291 of the BiggerPockets Money podcast, he is David Perret and I am Mindy Jensen going back to basics and saying, see you later, alligator.

 

Help us reach new listeners on iTunes by leaving us a rating and review! It takes just 30 seconds. Thanks! We really appreciate it!

Leave a Reply

Your email address will not be published.

Back to top button