Maximizing Cash Flow with Multi-Market Real Estate Strategies with Sarah and José Sala
“The man who has confidence in himself gains the confidence of others.” - Hasidic Proverb
Maximizing Cash Flow with Multi-Market Real Estate Strategies
w/ Sarah and José Sala
In this episode of REI Hacker, Benson interviews Sarah and José Sala, a dynamic Denver-based couple with an impressive range of real estate ventures. From managing luxury vacation rentals in Mexico to acquiring cash-flowing rentals in Detroit, the Salas share their strategies for building a diversified investment portfolio. They also discuss their efforts to support fellow investors through Denver’s Cashflow Club, which they founded to foster a strong local investing community.
Meet José and Sarah Sala: Diverse Real Estate Investors and Community Builders
Benson kicks off the episode by introducing José and Sarah Sala, co-organizers of Denver’s Cashflow Club and seasoned real estate investors. The Salas are involved in fix-and-flip projects in Denver, luxury vacation rentals in Mexico, and cash-flowing rental properties in Detroit. As Sarah puts it, “We love creating community. We know that we cannot do everything ourselves.”
Their passion for community extends beyond networking; the Salas also spoke at the BPCon event in Cancun (BiggerPockets), combining professional development with a much deserved family vacation to their Mexican luxury short term rental property.
Luxury Vacation Rental in Mexico
The Salas began their journey in international real estate with a luxury vacation property in Mexico. Purchased at auction for just 47% of its market value, the project presented significant challenges, including $140,000 in renovation costs for custom-made furniture and upgrades. Today, the property is a high-end rental, generating approximately $700 per night.
Expanding Investments for Cash Flow: Detroit Strategy
Why Detroit?
High property prices in Denver drove the Salas to search for markets offering better cash flow potential. Detroit emerged as an ideal choice. As José explains, “Three years showing continuous population growth... people are starting to move back into the city.”
Market Vision and Goals
The Salas are targeting duplexes in Detroit, aiming to acquire 100 units within the next two years. They focus on properties priced between $50,000-$70,000, with renovation budgets of $20,000-$30,000, keeping their total investment under $100,000 per duplex. “We started looking for the next new market. Definitely the lakes region in general is where everybody's pointed out for cash flow,” José notes.
Real Estate Strategies and Lessons
Fix-and-Flip vs. Cash Flow
Sarah acknowledges the allure of fix-and-flip projects but emphasizes their limitations: “Fix and flipping is very sexy, right? It's visually very appealing... but it doesn't give you monthly cash flow.” This realization steered the Salas toward implementing strategies like the BRRRR method and to prioritize sustainable passive income.
The BRRRR Method in Action
Using the BRRRR (Buy, Rehab, Rent, Refinance, Repeat) strategy, the Salas aim to leave no cash tied up in deals, instead refinancing to access funds for new investments. They’ve embraced partnerships to scale their acquisitions, with Sarah noting, “The second you learn to partner is when you're able to scale.”
Negotiation Techniques
When negotiating property prices, José shares, “We’re not afraid to haggle anything.” Their creative approach often leads to favorable deals, enhanced by transparency in presenting detailed cost breakdowns to sellers.
Building a Community for Investors: Denver’s Cashflow Club
Community building is at the heart of the Salas’ real estate philosophy. Inspired by Pace Morby’s advice, “If you want to do anything, go home and create a community,” they founded Denver’s Cashflow Club.
This monthly meetup provides a space for networking, education, and support. José describes the group as refreshingly sales-free: “Nobody's trying to sell me anything. Nobody's trying to force me to get out.” The club thrives on authenticity, with one simple rule: “If you want to be on stage, you better know what you're talking about.”
Investing with a Long-Term Vision
The Salas’ investment philosophy centers on building a legacy. As José explains, “Our goal is to set up a really nice portfolio that I can give to my kids.” This vision drives their focus on volume and partnerships, with Sarah adding, “Volume is better than trying to do everything by ourselves.”
Diversify Across Markets: The Salas mitigate risks by investing in different cities and property types, balancing long-term goals with cash flow.
Build Community: Their Cashflow Club exemplifies the power of networking and collaboration in growing as investors.
Embrace Creative Financing: By partnering with others, they scale faster and share the workload.
Focus on Cash Flow: Strategies like BRRRR help maximize returns while minimizing tied-up capital.
Invest with Legacy in Mind: Their goal of creating a portfolio for future generations informs their decision-making and long-term planning.
Closing Thoughts
Through smart investing, creative financing, and community involvement, Sarah and José Sala have built a diversified real estate portfolio that maximizes cash flow while fostering meaningful connections with fellow investors. Their story is an inspiring example of how strategic planning and community commitment can drive real estate success.
To hear more from the Salas, tune in to this episode of the REI Hacker podcast.
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