84: House Hacking From Condos Into Commercial Property with Tiffany Alexy
For those that don’t already know, we love House Hacking and think it’s a fantastic way to not only build passive wealth, but also act as a catalyst for getting started in real estate investing. It’s a great gateway strategy into larger, more sophisticated deals. However, a niche that doesn’t get talked too much about amongst beginners is commercial property investing.
Tiffany Alexy joins us in this episode to shed some light into the commercial property space and explain her journey from house hacking during college to unexpectedly becoming an owner of a commercial office building.
It all began with a single condo she purchased (and House Hacked) during her senior year of college. A few years after that, it turned into two condos. Now, this is the point in which most people would have found the winning formula and repeated this until they found financial freedom. But with Alexy, she wanted more.
Originally, she wanted to venture into larger multi-family apartment complexes, but due to the market constraints and timing, she was directed towards a commercial office building in which the numbers caught her attention. After further due diligence, and the execution of a 1031 Exchange, she sold off her two condos, and used those profits as a down payment for the new, more profitable building that has much greater potential.
Some key takeaways from our conversation with Tiffany: 1) Obtaining a real estate license is only a good idea if you know what you are going to use it for. There are fees that come with having one so make sure you get good use out of it. 2) Student rentals can be profitable, but turnover and upkeep can be costly. With a commercial property, you have one tenant, usually for years at a time. 3) Rent for a commercial property works slightly different than a residential one, but it all comes down to the lease. On the investor side, rents are calculated as (price ✕ square feet) per year.
If Tiffany could go back and talk to her 16 year old self, she’d tell her, “Get a job… The earlier you start off hustling, the better off you’ll be.”
An unexpected benefit of real estate investing, Tiffany said, was being able to have the security of financial freedom. By having this kind of security, she is able to take on more risk.
A piece of advice Tiffany would tell her friends looking to get started in real estate would be to House Hack because “it’s a no brainer.”
Tiffany uses Scannable to be able to scan important documents on the fly and transport them digitally.
She recommends reading The Sell by Fredrick Ekland to help you in your entrepreneurial venture, as well as build your business through personal branding and key relationships.
If you’d like to get in touch with Tiffany, follow her on Instagram: @tiffany.alexy