How to Create a Rich Life Through Passive Real Estate

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I’m a recovering single-family residence investor. 

Don’t get me wrong, I still love the hustle of finding a property, the game of negotiation, and the thrill of closing a deal. 

But, for me, that is where the fun ends. 

As a real estate investor, I often wrestle internally with the question… “I should LOVE real estate, right?”

Yet, it took me years to understand that real estate investing does not make me RICH (or anyone for that matter). Real estate is a tool I can wield to create a RICH life. 

A life where I have financial freedom, time freedom, location freedom, and freedom to make an impact. 

Why is it Important to Learn How to Live a Rich Life?

If you have ever joined me on one of my weekly masterclasses, you’ve heard me thank people for not only spending time with me but investing time in themselves. 

Why do I do that? 

Time is our most precious non-renewable asset. You can always make more money, acquire another asset, and buy more things. But once you spend that minute, you can never recover it. 

Once I realized what I was truly after in life (time freedom), I dropped out of the race to acquire a large unit count and high net worth and began measuring my success in how quickly I could convert income that I had to trade time for into income I made passively while I slept.

I know many of you are in the same boat and want to know my process. I systematically analyzed my portfolio to reposition assets that were underperforming or costing me too much time to manage and harvest gains where I could utilize the six pillars of wealth-building that I constantly talk about to amplify my returns. The six pillars are capital preservation, cash flow, equity growth, tax benefits, inflation hedge, and the ability to use lending.

But then I added in one more criterion… the asset must have massive time leverage.

You see, when you invest passively, you can leverage the operator’s knowledge and expertise, their networks, their ability to get credit and lending, and their ability to bring other investor capital to the deal. 

But the most important leverage you receive when working with a quality operator is you leverage their time and attention, which means you can get your time and attention back to create a RICH life for you and yours.

The Results

Having my time back allows me to hop on a plane to California for spring break with my family, take that last-minute whale watching tour, watch my nine-year-old (a budding photographer) spend hours taking hundreds of photos of the penguins and otters at the aquarium, dine in a luxurious seafood restaurant and watch the sun slowly set on the coastal water, spend time with friends we had not seen in a couple of years, and go off-grid exploring the woods of Sequoia and Yosemite. 

For me… that is a RICH life.

And the cool thing is, all the while, I was making passive income. 

For those of you that know that I still have a good chunk of my single-family investments managed by a property manager, you may ask, “How did those fair while I was gone?” Well, I had to:

  • Finish settling an insurance claim from a break-in the previous month
  • Approve a tree cutting project for a tenant who would not sign a lease renewal without it
  • Wrestle with Home Depot to repair a defective washer delivered the week before
  • Negotiate a boiler replacement bid for another unit

None of these actions took a huge amount of time, but they diverted my attention and were annoying to deal with while I was on vacation. In perfect transparency, they robbed me of my RICHness. 

As far as my passive investments, I received an email asking if I wanted to participate in a 1031 exchange for the sale of three assets. It took me less than three seconds to respond “Yes!”

Now that is a substantial difference!

Wrapping Up

You may ask if I am ready to sell off my single-family property and go all-in with passive investing. I am not quite there… yet. What I am sold on is ensuring that any asset I add to my portfolio meets my “time and attention” test, where I can fully disappear for 14 days, and the asset can run by itself with zero input from me.

That way, I continue to focus on the experiences that make me rich and lean into the “RICH” life I am designing for myself and my family.