HEATHER EWING: The CRE RUNdown
Are you intrigued by Commercial Real Estate? Join Heather Ewing, CCIM each week as she dives into CRE trends, Deals, and Developments throughout Madison, WI. Learn the crucial role of Mindset in CRE and Marathons! Success leaves Clues.
HEATHER EWING: The CRE RUNdown
Ep. 49 John Laine - From Transient Childhood to Pioneering Real Estate Success and Compassionate Capitalism
Ever wondered how a transient childhood could fuel a lifelong passion for real estate? Join me, Heather Ewing, as I uncover the extraordinary life of John Laine, a seasoned real estate investor who started his journey at just 19. John shares how his quest for stability amidst constant relocations as an army officer's son led him to pioneering house hacking before it even had a name. Gain insights into his 35-year career, marked by resilience and strategic decision-making, including surviving the 2008 financial crisis through sheer perseverance and preparation for when luck came knocking.
But that's not all. We also dive into a touching story of renewal and purpose, where a former real estate professional returns after a decade long hiatus with a powerful mission—compassionate capitalism. Discover how this individual, rejuvenated by counseling and the great outdoors, is now making waves by collaborating with nonprofits to open doors to homeownership for younger generations. The emotional reward of transforming renters into homeowners underscores the meaningful impact of this initiative. Plus, find out how you can connect with John Laine for further insights and inspiration.
Welcome to Heather Ewing, the CRE Rundown. I am your host, heather Ewing, from Madison, wisconsin, and today I've got a great guest for you. It is none other than John Lane. He is an investor out of Vancouver, washington, john, welcome.
Speaker 2:Hi there. How are you, Heather? Thank you for having me.
Speaker 1:Definitely my pleasure. So I've known you for about a year and a half or so on LinkedIn.
Speaker 2:But for those of my guests that don't know you, yet please share a little bit more about yourself and what you do. The 30-second version is we are. I've been in real estate for 35 years, bought my first house when I was 19,. Right, I'm 57 now, so I've had this 30 plus years of compounding interest in my life, so that's been really, really cool. Now we, because of that decision being able to buy young, we help other families buy their first home. We buy old apartment buildings, convert them to condos and sell them to first-time homebuyers. So that's like the 32nd. As quick as I could do it answer.
Speaker 1:Right, that's terrific. So do you ever sell or finance?
Speaker 2:We don't. We want to. We're not quite big enough to do that yet. We will probably do seller financing, maybe on the fifth or sixth or seventh one, but we're still perfecting the business model. Once we get like our fifth one, I think we'll be doing seller financing from that point on.
Speaker 1:That's terrific. So 19, that's an early age. Kudos to you, John, for the foresight. What would you say? Was there a person, was there a book? Or what inspired you to be so smart and begin investing at the tender age of 19?
Speaker 2:My dad was an army officer and so we had moved over and over and over and over and over and over again as a kid, right from the age of 5 to 18, we were moving every couple of months and I was just very tired of being moved around, not having control over my life. Um, and I ironically gotten into a pretty bad car wreck that summer before and so I had a lump of cash and and I had a couple of really good friends that we we did house hacking before, before that, the idea of house hacking was even a term. I just that the idea of house hacking was even a term. I just $2,500 down, got the house on contract, my two best friends moved in with me and that was it, like that was. I mean, I had no idea how important that one decision would be in my life. I really honestly, looking back in hindsight you know like life gives us forks and decisions at points in time I honestly had no idea how important that moment would be in my life.
Speaker 1:It is intriguing, isn't it? And it's kind of funny. I had a conversation with a lender just yesterday over coffee and we were talking about that too, of life presents choice points, and sometimes you realize it, sometimes you don't, and one decision really can shift and change things to your point. So that's great.
Speaker 2:It's been foundational, like that one house. It forced me to think. I mean, as a 19 year old, you don't really think of adult responsibilities, but it forced me to think of adult responsibilities. At that same time, I bought my first business. I was working as a carpet cleaner for this gentleman. He got sick, he asked me to buy his business and so simultaneously I'm a first-time homeowner and a first-time business owner.
Speaker 2:Go large, go large, john. It was crazy how God the universe works to conspire to just shift a person's life. It really it still astounds me how it all happened.
Speaker 1:I love that, but I think too, you know you see more signs coming out to back it and things of that nature, of what we focus on does grow, and those different you know the dreamers as long as you're putting action behind it. And when these different scenarios appear, that you did take it. You ran with it Because, if you think about it, you could have had this lucky break and you could have spoiled it per se or in the sense of not reinvesting and not being smart with your money. So you did have, if you want to say, the hand of God, come in for you. But at the same time you made a lot of right decisions. I think that has put you to where you are now. So, in that sense, definitely a series of good decisions.
Speaker 2:It's very much my perspective. It's very much putting yourself into those positions where luck, or whatever you want to call it, can smile upon you. Right, I started working when I was really young, like really really young, and just putting yourself out there in an opportunity where Providence can have its hand in your life, can have its hand in your life. Right, I mean it's I can't remember the luck and hard work combined.
Speaker 1:And was it Jim Rohn? Maybe you know that, or someone had you know? One of the greats of luck favors the prepared, that's it.
Speaker 2:That's the quote I was looking for. Thank you, yes, I've got your back, john.
Speaker 1:I've got your back, john, I've got your back, so yeah it's one of those make smart decisions, do the right things.
Speaker 1:Being consistent and I think that's something I really learned over the past several years is the power of consistency, because you see a lot of people that shine bright and then they go to the wayside because they don't have the dedication and that deep burning why to help propel them over those challenging moments and hurdles. So what would you say has really helped you to get over some of those hurdles with you know, your approximately 30 years of investing?
Speaker 2:Well, I survived the great financial crash Like that was a big deal. I lost damn near $80 million in and whether that storm, that was hard, that sucked, would not.
Speaker 1:Right no.
Speaker 2:Yeah, that was. That was really tough. But I mean mean perseverance, being willing to. After 09, I basically took a dozen years off. I'm just like, okay, I'm checked out. I just didn't have the mental or emotional strength to get back into the real estate world. I tried other businesses but I just they didn't, I didn't enjoy them. But it took a lot of perseverance. It took a lot of counseling. This is why I like Chris so much of um counseling. Uh, this is why I like chris so much. I I did yes for almost three years to get my my head and my heart to align again.
Speaker 1:Um, yeah, it's it's integral to your point and you know, with it being so many years in the past, before meeting with chris, are you able to identify one or two things that helped you to, if you're going to say, continue on each day towards the goal?
Speaker 2:so I, I do a lot of hiking and backpacking. Um, nice, that gets that. That that takes the focus off the mental frustration losing $77 million right, there's a lot of crap in your head, right, I'm sure. Just like taking a walk, going climbing a mountain, just repetitively hiking. It got me out of my depression. That was able to lift a lot of the depression issues and it started I'd interact with people on the trail and I'd be friends and I did part of the PCT and I'd make some friends and they were all struggling financially. And here I was, mid-50s, relatively comfortable, relatively financially solvent. My wife worked through that whole time but I didn't. For almost 12 years I didn't really work and I was. I gave myself some time to heal but I also, through the hiking, gave myself time to think and I started looking at like the macro of what are the problems in the real estate world and if I were to go back into it, what could I fix? What impact could I leave?
Speaker 1:Right and kind of creating a new plan.
Speaker 2:Very much a new plan. Yeah.
Speaker 1:Yeah, that is great. So what is your plan? It's, you know, it's 2024. What's your plan for next year, or even the next few? What's what's pulling at the heartstrings?
Speaker 2:I, I am passionate. So because of my kind of origin story, of being able to buy when I was young, I realized that, like the average age of a first-time homebuyer in America is 38 years old Are you serious.
Speaker 2:Yeah, true fact. Wow, wow. Median house price is like $385,000. Median down payment is $71,000. Like the American dream is basically being ripped out from underneath people. And I just I look at my own experience and I said I think I can solve this problem. And so I grabbed a couple of my investor friends, turned them into partners and we're slowly helping families buy their first home. Like we, we're partnered with a nonprofit right, so that's really impactful for me. So we're we're partnered with a couple of nonprofits. We're buying properties at really really deep discounts, doing the renovation ourselves and then selling them first-time home buyers at 80% AMI. Like wow, it's really pretty awesome that is that is.
Speaker 2:I mean to watch. We just had a conversation, we just bought a building and to watch the residents their whole demeanor changes when you say you can stop paying rent and start owning.
Speaker 1:And we're gonna like that's john, you're like the modern day santa. You need to put some of this. I want to see videos. So I am creating an action item for you all. I'm creating some of these videos.
Speaker 2:That would be great it was, we did a pizza party. So every time we buy a building we have a pizza party and we connect with our residents. We have, hey guys, they come downstairs and they're really timid and they're really like, not sure there's a notification.
Speaker 2:We just bought your building and every resident in the world is terrified of their new landlord right right and so the unknown right first 20 minutes, first half hour of the conversation, we're saying you're not being evicted and you're not getting a rent increase. You're not being evicted and you're not getting an increase. I mean we've said 15 times and all of a sudden there's this collective sigh of relief.
Speaker 1:Everybody's like right and then you get here's some wild stories with other people's experiences. So it's nice that you address that right up front, because otherwise you know that they're not going to be listening because there's going to be so many different ideas concerns swarming their heads. So I love your approach direct and also put the fire out before it begins right, so I know it's cheesy.
Speaker 2:We call this compassionate capitalism, right I?
Speaker 1:like it, it's true, though.
Speaker 2:Yeah, I mean, both words are important, right, compassion first. We, every conversation we have, leads with compassion. There is a tonality of capitalism. We want to make a profit. You can't. You can't do our business model without creating a profit Exactly. But there is. Our residents are buying houses assuming they follow through at $1,000. 80% AMI. So we're selling units in this building at $225,000. The median comp in the area is 260 for the exact same thing. They're literally walking into $40,000 of equity and we're working with either low income or modest means income, people who would not normally have even the I mean seventy thousand dollars for down payment right right yeah, and we're giving them the down payment, like it's part of our mission is to we give them three months of payment, right?
Speaker 2:We just it's. Yeah, sorry, I get a little excited.
Speaker 1:Well, no, it's terrific, and you know that's the thing you hear so much in society about of like, well, time freedom's okay, but to have money is bad, and to me, if you didn't have, you know, the wise investments that you made, you wouldn't have the money to be able to give back in this way. So I think people in general really need to take a hard look and realize that money is a great, great thing and it allows people to do great things with it. It's really a personification of someone, whether they're going to do good or if they choose not to. So kudos to you. What a beautiful way to give back and also to continue caring for yourself and family and expanding the goodness throughout your community. So here's another question for you If you were to reflect back on the last five to 10 years, what is a piece of advice that you would give yourself?
Speaker 2:Go to therapy. Thank God for Chris Holy smokes. I wasted 12 years I had such. When you create wealth, a lot of people in America, myself included, we equate net worth with self-worth. Right, that's just how we're wired as americans, right, net worth, right self-worth. When my net worth crashed, my self-worth crashed. And I mean if I had said, if you had said like, hey, what would you do different in the last five to ten years? I, I'd say, go to therapy earlier. Right, I wouldn't have lost a decade. That means helped a lot more people. I, I, I've had this condo conversion roadmap in my brain for 15 years, but I didn't.
Speaker 1:Yeah, yeah. Well, the beauty is you can probably help such an even larger group by going through that experience, because so many people, to your point, don't get help. And you know, I've been there at different times too. And be like I look back I'm like, oh my God, heather, you could have made this a lot easier. There was no reason, you know, for that level of pain. Tony Robbins has a, you know, a great quote and I don't remember it exactly, but it's something about there's hardships in life, but the amount of pain you choose to put yourself through is another story and I was like, ah, yes, exactly I.
Speaker 2:Um, it was a hard, like the last five to 10 years were tough, but helping. For me, it's about helping other people, right? I don't need more zeros, I don't need more commas in my bank account. They're helpful, they're nice, but I don't need them Right? For me, it is a legacy of trying to serve others. It is a legacy of trying to serve others. When I lost my portfolio, I had roughly 1,000, 1,500, 1,200 people relying on me for their shelter. Right when I lost my portfolio, let's say, 1,500 people went homeless. I lost my properties, they lost their homes, and that's a burden that I will carry for the rest of my life. Some of these residents had been in those homes for 5, 10, 25 years and, because I lost my portfolio, those people suffered consequences that were not their fault, and so I feel a sense of compassion to try to write that for other people, I don't know.
Speaker 1:I want to give residents more control over their lives, and it starts with home ownership residents more control over their lives, and it starts with home ownership, right, and I think it's one of those, when you are a caring and compassionate person, that what you know no one could have planned 2008, nine right, and it's one of those. No one would have ever wished that upon anyone, and so, in that sense, I think it is you know us a type personalities is easy to accept ownership of that when it's like, no, we're not omnipotent, we can't control these things, otherwise there wouldn't be, you know, half of the bad things that happen in the world. So I love that you're really utilizing that energy, though, and to propel forward improving people's lives, and with that, my last question for you is what would you say living fully means to you, john?
Speaker 2:Hiking with my wife in the Redwoods, like there's no bigger like my. We got married in the Redwoods, we go to the Redwoods all the time. Like it's like living fully is quality time with the person I love the most in the place I love the most, and not worrying about money, not worrying about are the bills paid, not worrying about, uh, the normal financial strains of life Quality time with my wife in the Redwoods. Final answer I love that.
Speaker 1:And that is perfectly said. So with that, john, thank you so much for joining me. And before we end this podcast, share with my audience. How can they reach you? What's the best method for that?
Speaker 2:So easiest, john J-O-H-N at condo C-O-N-D-O dot fund F-U-N-D. Super easy, nocom, just John at condofund yeah.
Speaker 1:Perfect.
Speaker 2:Yeah, excellent.
Speaker 1:Well, john. Thank you so much for joining me today. I appreciate it.
Speaker 2:I really enjoyed it. Thank you for your, for your kindness and compassion as well. Yeah, bye, bye.