Summary: The goal of our Investor Spotlight series is to provide you with stories of real physicians and professionals who are at different points in their journey to financial freedom through real estate investing. At Semi-Retired MD, we love to share many perspectives and learn from others’ experiences along the way. Today’s spotlight is on Jordan and Selenid Frey, who realized right away that the best way to learn about real estate investing was to get started.
Six months ago, Jordan Frey was finishing up a plastic surgery fellowship and his wife, Selenid, was defending her dissertation. Jordan felt “financially clueless.” Then he and Selenid began reading books about personal finance and investing. Within weeks, they’d created their first financial plan and signed up for Zero to Freedom.
In June, they closed on their first property, a two-door rental in Buffalo, New York, where they live. Buffalo is Jordan’s hometown. For that reason, he explains, real estate investing isn’t just about financial freedom for him. It’s about investing in a place he loves.
How did you and your wife become interested in real estate investing in the first place? What is your “why” behind this? Was there a triggering event that led you to start your journey in real estate investing?
For so long, I just ignored my finances. I thought, “I didn’t go into this for the money,” even though that’s a stereotype around plastic surgery. I didn’t really care about the money. At the same time, I was disillusioned with my growing debt. Even though I was about to become an attending, my financial issues weren’t magically going to take care of themselves.
Right before COVID-19 hit in March, both my wife and I decided, “you know what, we really need to figure this stuff out.” We started educating ourselves, reading books in tandem, then discovered some financial blogs. Initially, we were just thinking that we were going to work and invest traditionally, in our retirement accounts and index funds, but real estate kept popping up. It was intriguing, but we said, “we don’t have enough time, we don’t have enough money, it’s just not for us.”
That’s when we found Semi-Retired MD. We began watching videos, reading blogs, and thinking, “why not us? Why can’t we be working toward financial freedom while we’re young enough to enjoy it?”
We wanted to live on our own terms. We love what we do, and it’s not that we are planning on stopping anytime soon, but we want to do it on our terms. We’re always happier working because we want to than feeling like we have to. We have two young children, a two-year-old and a one-year-old, and we want to maximize the amount of time we have sharing experiences with them. Instead of fitting the experiences into the work, we wanted to fit the work into the experiences.
It’s also fun. We enjoy learning and doing new things, and this fits right into that. Also, I’m from Buffalo originally. We decided to come back here. It’s a smaller community, and by trying to buy these properties and fix them up and provide good quality housing, that gives us some motivation — a feeling that we’re fulfilling our desire to give back.
What was your first purchase?
The first property we put an offer on was a great property. We saw that one and the property we ultimately ended up buying on the same day and decided we were going to put offers in on both. At 9 p.m., our agent called and told us we had it. We signed the contract. Then, the next morning, I was driving to work, and our agent called and said the seller’s attorney killed the contract because we had an inspection contingency.
But the next day, we put an offer in on the second property, and we got it. We went through the inspection and were able to get a $10,000 price cut, and it all worked out the right way because I think we framed it the right way.
What type of properties are you focused on as you grow your portfolio?
We’re focusing on 1-4 unit multifamily properties in B and C class path-of-progress areas. We’re planning to build our portfolio pretty aggressively. We have one duplex; before the end of 2020 we hope to have another one, then keep adding multiples per year and exchanging those within a few years for bigger properties.
How are you balancing your real estate investing with your careers?
We thought it would be such a strain to find the time for real estate investing, and that was one of our limiting beliefs. That just hasn’t been the case. We’ve found that once you prioritize it, you sort of just find the time. It’s an important thing that we’re really committed to, so we find the time.
How did you balance your investing with student loans? Did you wait until after you paid them off or did you start investing while you still had loans?
I still have a lot of student loans. That was something, in the beginning, that I struggled with. Before we had committed to real estate investing, we had set forth a plan to pay off our loans in five years. When we decided to make real estate investing a priority, we adjusted our budget so that we can still plan to pay off loans in five years but also a plan to aggressively invest in real estate.
We have a 41% savings rate. A third of our savings is going toward paying back loans, a third is maxing out our traditional retirement plans, and a third is toward real estate investing. That’s enough to be aggressive and achieve our goal of multiple properties in a year.
Can you tell us about any difficulties or failures you’ve had in investing? What has been your biggest challenge? What did you learn from it?
The final chapter of every book on real estate is basically the same: You’ll never get to the point where you feel that you know enough to start. You just have to dive in and say, ‘‘we’ll figure it out.” That definitely happened for us. Early on, before the Zero to Freedom course started, we thought we were ready to go, and it got to the point where we were getting the contract prepared, and the financing we were expecting to work out just didn’t work out. We realized we needed to take a step back and make sure we were totally ready before jumping in.
It was discouraging because we felt like we were ready to do this, but it only set us back a couple of weeks. Both our next offers were better cash-flowing deals. That initial property is still on the market, and its price has been lowered numerous times. We’re considering putting a low offer in on that soon. Now that we have more experience, we know what it’s worth and the hidden value that we can tap if we’re able to get the offer on our terms.
How has real estate investing affected your lives? The good? The bad?
I found that as I was developing a plan to become financially free and enacting it, I was happier at work because I felt that I was doing it for the reasons I actually got into it, rather than because I had to. I started to equate financial well-being with personal well-being.
Where are you now in your journey? Do you still want to grow? What are your goals of where you want to be in 1 year, 5 years, or 10 years from now?
In one year, our goal is to have Selenid have real estate professional status and to have at least four doors. We have two now. In five years, we want to be cash flowing $300,000 per year. In 10 years, we want to be financially free and working on our terms, which for us means cutting back to half-time.
Any final words of advice for doctors interested in starting out in real estate?
I think it’s in The Millionaire Real Estate Investor where I read, “there’s no being lucky. The people who are called lucky are the people who are always prepared,” so when the right opportunity comes by, they’re ready to act. I think that’s how we felt for the property that we bought. We’d gone through the bumps in the road, taken our lumps, and we were prepared to get lucky.
A big thanks to Jordan for sharing his and his wife’s journey with us. If you want to learn more about him, you can find his blog, The Prudent Plastic Surgeon, here.
