JF1806: Passive Income MD: Full Time Doctor, Family Man, Real Estate Investor & Blogger with Peter Kim
Peter runs his own blog which is very popular for people who are in a similar situation to him. He shares his knowledge of putting his money to work through real estate investing, while working a ton of hours as a doctor. This episode has tons of value for other high income earners, as well as anyone who could use help with prioritizing their time between family, work, and real estate investing. If you enjoyed today’s episode remember to subscribe in iTunes and leave us a review!
Best Ever Tweet:
“I look for other people who have invested with them” – Peter Kim
Peter Kim Real Estate Background:
- Owner of the website https://passiveincomemd.com/ where he shares his knowledge of passive real estate investing with doctors and other high income professionals
- His site and blog are viewed 50k people each month
- Based in Los Angeles, CA
- Say hi to him at https://passiveincomemd.com/
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Theo Hicks: Hi, Best Ever listeners. Welcome to the best real estate investing advice ever show. I’m Theo Hicks, and I’ll be the host for today’s episode. Today I will be speaking with Peter Kim. Peter, how are you doing today?
Peter Kim: I’m doing great, thanks for having me.
Theo Hicks: Thanks for coming on. I’m looking forward to our conversation today. A little bit about Peter – he is the owner of the website PassiveIncomeMD.com, where he shares his knowledge of passive real estate investing with doctors and other high-income professionals. His website and blog are viewed by over 50,000 people each month. He’s based out of Los Angeles, and you can say hi to him at PassiveIncomeMD.com.
Peter, before we begin, do you mind giving us a little bit more information about your background and what you’re focused on now?
Peter Kim: Sure, absolutely. I’m currently an anesthesiologist living in Los Angeles, California, with a wife and two children. I’m originally from the East Coast, but I ended up out here following my wife, to follow the California dream. I started as an anesthesiologist about nine or ten years ago; I was working, and that was my goal from the very beginning – get out, finish my training, work as a physician, help a lot of people, live a good life… But a few things happened at work – a few things politically, with some job uncertainty – and I got to the point where I realized I can’t rely on this completely, at least this income, to give me the life that I wanted, at least for myself and my family… So I started looking outside of medicine to figure out what else are people out there doing for income for this concept of financial freedom, and I landed on real estate.
I had some other physicians that I saw who were living the life that I wanted, and they were pretty much all doing real estate… So I started exploring that, I started learning so much about it, I started going online, listening to podcasts, reading blogs, and the next thing you know, I started doing a few deals, started picking up a few rental properties, I started investing in some syndications and crowdfunding. I was telling all my friends about it, and they wanted to know exactly how I was doing it. I guess I got tired of having the same conversation over and over again, and I started just to put it up on a blog. I started to write about it, share my experiences, talk about some of my mistakes, my failures, some of the good stuff that was happening, and the next thing you know, organically people started to come [unintelligible [00:04:49].26]
Theo Hicks: I’m sure working as a doctor you work a lot of hours… So for other people who are also working a lot of hours, what advice do you give them to get started in this real estate investing endeavor?
Peter Kim: Yeah, my life as a physician is pretty busy, and for anybody who has a job, anybody who has a family, anybody who has hobbies or passions, you’re gonna be busy. So it’s not really a matter of finding time, it’s a matter of figuring out what your priority is. So what I would do is I would work a long day, I’ll come back home, I’d see the kids, try to spend my time with them, spend my time with them and my wife, put them to bed, and then at that point is when I would get working; and I would work from 8 PM to maybe midnight, work really hard, maybe sleep for five hours, wake up, and I’d even start working at it again.
So I would find the time just to do these things, and unfortunately some things I had to give up. I don’t watch TV as much as I used to before. Some of my favorite shows are just sitting there, waiting for me… But you just have to make the time and just take the action, and really figure out what’s important to you and what your goals are in life.
Theo Hicks: And are you strictly doing passive investing, or are you an active investor as well?
Peter Kim: I do both. I like the idea of diversifying. I started by investing in crowdfunding, I started investing in syndications first, because my lack of experience — I didn’t know how to start; I didn’t know whether I could take on a rental property on my own. But once I kind of dipped my feet in using those things, I started feeling more comfortable, got a little more confident. Then I started buying my own rental properties. I bought a single-family home. Then I bought a single-family home out of state. Then I picked up a few multifamilies. But then all along the way I’ve still continued to invest passively as well.
Theo Hicks: Okay, so you started off passively and then transitioned into actively, while continuing to passive invest… What skills, knowledge, anything that you’ve learned from passive investing helped you transition into active investing? Or did you have to learn active investing completely separately from your passive investing?
Peter Kim: That’s a good question. I think a lot of it just had to do with confidence for me. It’s just putting your money somewhere else to work. I was so used to working as a physician, doing the active income thing where you put in your time and you make money… The whole concept of investing, putting your money elsewhere, letting things happen, setting a system and letting things happen in place was totally foreign to me… So I kind of just had to get over that, and that’s what really passive investing helped me to do.
The funny thing is once you start passive investing, start investing in those syndications, in some of those crowdfunding debt deals and some of those equity deals – you know, I started actually looking to the numbers, I started learning. It wasn’t a whole lot of money when I first started, but just having a little bit at stake really forced me to get in there and learn. So I started learning about “Yeah, what is rental income? How do you increase these types of things? What’s cap rates? Net operating income”, I started learning about some of those numbers, and then – again, it gave me the confidence to go out and purchase my own properties. So there was definitely a hurdle that I needed to get over initially, and really passive investing helped me get there.
Theo Hicks: Yeah, I think that’s really important that you said that. I think one of the biggest characteristics that differentiates someone who doesn’t and does invest is that confidence. You learn everything, but do you have the confidence to actually take action and actually do it?
Peter Kim: Right. The thing is you have to be okay with failing. I think what I’ve learned is that you can sit there and read all you want, you can sit there and learn, but it’s like a totally different ballgame once you get in there… And you learn so much more by just getting your hands dirty. And I think I got to the point where I realized, “Look, I’ve gotta take chances here and I’ve gotta move forward.” I was just sitting there reading and learning and I wasn’t doing anything, so unfortunately I wasn’t growing as well… So a part of it was that “Look, I’m gonna make some mistakes, but I’m gonna learn a ton in the process”, and that’s actually what ended up happening.
Theo Hicks: Exactly. So when you’re talking to doctors and other high-income professionals about getting started in passive investing, what advice do you give them? Or let’s say if they wanna invest in a multifamily property with a syndicator – what advice do you give them for finding, evaluating and screening different general partners, different syndicators?
Peter Kim: Well, that’s the number one question I get through my blog… And I also have a community of about 7,000 physicians in a Facebook group that I work with and I moderate and I talk to, almost on a daily basis. We talk about different syndications, different opportunities, ways to make passive income… But again, the number one question I get is “How do you choose which syndicator or operator to trust? How do you know a deal is good? How do you verify what’s on paper?” So we spend a lot of time, and unfortunately that’s not an easy question; I think that’s a thing that even professional syndicators – that’s something that they’re continually refining and learning.
So I do spend some time on the blog, writing post, by post, by post, and we spend some time actually going through even some case studies in the Facebook group… But one thing that I’ve actually done recently to really help people in this manner is I’ve actually built a course. Again, so many people were asking me “What are some of the best resources out there for people?”, so I decided to really package that and put that into a course that hopefully condenses all those months and years that I spent trying to learn about this stuff, really only into a couple hours, for the busy physician.
Theo Hicks: Here’s a more specific question – what would you say would be the top characteristics of a syndicator that you can trust? What are 2, 3, 5, whatever things that a syndicator must do in order to gain that trust from a passive investor?
Peter Kim: I tell people the number one thing to look for is track record. I want someone who’s already established and has experience doing this thing. Ideally, this is somebody who’s seen some of the ups and downs of the markets and that has been able to navigate that. Obviously, there’s so many good deals out there and there’s so many bad deals, but what will make or break a deal is the way the sponsor can really operate and execute their business plan… So I go back to their history to look and see what they’ve done in the past. Again, it doesn’t have to be a spotless record, because obviously, what happened in 2007 and 2008 – there were some ups and some downs. Ultimately, how did they navigate through that thing?
So number one is track record. Number two – I feel more comfortable if somebody else that I know has invested with them, or somebody that I trust has invested with them… So that’s what I look for. I look for other people who have already invested with them, have a personal relationship with those people and can kind of tout, or vet, or attest to how good they are in terms of communication, how they’re executing their business plan, how they’ve been in terms of professionalism, that sort of thing. So that’s what I look for next.
Then after that, I need to have a personal conversation with them, and I recommend every single person does that. What we’re gonna do with this course, and what we’re gonna do even on the website, is I wanna give them the top ten questions they need to ask sponsors… And they should be doing these things themselves. I know on a lot of these crowdfunding platforms they kind of put the track record, and these kinds of things, of all the sponsors, and they’ve done the vetting… But I think it’s really important for doctors – or any busy professional – since they’re putting a good amount of their income to use, is to actually personally vet them themselves.
Theo Hicks: Alright, let’s change gears a little bit and talk about your blog. So you’ve got 50,000 people a month reading your blog… Before we talk about how you did that, do you mind telling us a little bit about the positive benefits that has had on your business, your life in general?
Peter Kim: Sure. When I started this thing I didn’t even know who would read this thing; I actually really created it just for a few of my friends to read, so again, I wouldn’t have to answer the same questions over and over again… But it kind of blew up on me, and that’s something that kind of took me by surprise. I’d be lying if I said I expected to build a readership like this… But it’s been amazing.
Obviously, I’m still learning, and I try to tell people on the site, I am not the one who knows every single thing about this whole subject, but it’s something that maybe I’m a few steps ahead of people… And this is what I’m learning, and this is what I’m doing, and this is the mistakes I’m making along the way… And the cool thing is it’s put me in the center of this community, and I’ve met so many great — not just physicians, but even professionals in the business that are doing some amazing things, and it’s really inspired me to get better at this. So I love just being able to be in the middle, to connect with so many people, and I feel like it’s opened up my whole world to a lot of different things that different people are doing. And again, every day I get inspired by somebody else, so that’s what’s been amazing.
The other thing is it’s really allowed me to connect to a lot of physicians who are in the same position really that I was, where they felt kind of stuck in their position; they’re making good incomes, but they don’t really have that time freedom, that financial freedom, and they didn’t really know what to do to get to the next step. So I’ve connected with a lot of physicians like that, and it feels great to have something to offer them, and just really connect with those people. That’s been an amazing experience for me.
Theo Hicks: Okay, and now the last question before we get to the money question – how were you able to get to the point where you had 50,000 blog views per month?
Peter Kim: I wish there was a magic formula to that, but again, I think a lot of it has to do with consistency. You guys do that same thing with the podcast – you guys are doing it every single day, and people know that they can rely on you to provide information every single day. So on my blog what I started doing was just putting out consistent content, and I try to put obviously good quality content every single time, something that was of value to people… And I actually put out something about three times a week; that’s been really busy, sometimes a little bit of a struggle for me to do that, but I think that consistency is what’s really helped grow the readership.
What I also do is spend a lot of time engaging with people, both on the blog, on the Facebook group, and I make sure that everyone feels that they’re able to get value out of this. Honestly, it’s been a slow growth; nothing special, but over time it’s just continually started to grow. There’s no magic formula to it.
Theo Hicks: Alright Peter, what is your best real estate investing advice ever?
Peter Kim: The best advice that I would give is just get started. I’m sure other people have given that advice as well… But so many physicians – especially physicians – wanna make sure that they have all the information before they decide to take action. I think that’s what we do with our patients – we take all the greatest information out there before we make a course of action and make a plan for people… The problem is in this world you’ve gotta take action sometimes to learn, and to get better, and to grow. So that’s my advice.
Theo Hicks: Alrighty. Are you ready for the Best Ever Lightning Round?
Peter Kim: Sure, let’s do it.
Theo Hicks: Alright. First, a quick word from our sponsor.
Theo Hicks: What’s the best ever book you’ve recently read?
Peter Kim: The best book that I’ve recently read is called Never Split the Difference. It’s a book on negotiation by a former FBI lead hostage negotiator, and it’s just really taught me a lot about how to ultimately get what you want in a negotiation, and at the same time help the other person get what they want as well.
Theo Hicks: What’s the author’s name?
Peter Kim: The author’s name is Chris Voss.
Theo Hicks: If you guys listen to episode 1244, it has the interview with Chris Voss. That was back in January of last year. If your business collapsed today, what would you do next?
Peter Kim: I would just start over again. I would just build it a little bit, by a little bit, by a little bit, but hopefully that won’t happen.
Theo Hicks: And how would you start over if you had little or no capital?
Peter Kim: Again, luckily, this thing doesn’t take a lot of capital. It’s a lot of time, energy and effort, and that I have a ton of… So I would definitely just continue to do this.
Theo Hicks: What is the worst deal that you’ve done?
Peter Kim: I would say the worst deal that I’ve done is the one that I ended up backing out of. I had an opportunity where I was in escrow for a flip, kind of in the lower Beverly Hills area here, and myself and my partners – we ended up kind of freaking out and we actually backed out of the deal. That was about 3-4 years ago. Unfortunately, I looked, and if we had sat there and done nothing with it, we would have made an amazing return and we would have killed it.
Theo Hicks: And then lastly, what is the best ever place to reach you?
Peter Kim: The best ever place to reach me is directly on my website, PassiveIncomeMD.com. I’d love to talk to you.
Theo Hicks: Great. And again, that will be in the show notes of this episode for those listening. Alright, Peter, I appreciate you coming on. Great information. Just a summary of what we talked about – we started by talking about how can people get started in real estate investing when they’re really busy, which is basically everyone… And for your advice and for what you did it was all about prioritizing your time, so just kind of finding the time to get to work, and giving up some of the things you used to do for fun. You said that you’d go to work and then you’d come home, spend time with the family, and then once everyone was to bed, you’d work until about midnight, get some sleep and then wake up and start working all over again, just to kind of get things up and running.
We talked about how you were able to transition from being a passive investor to becoming an active investor, and it was all about having the confidence to take action, as well as being okay with failing. Realizing that you’re gonna learn a lot more by taking action that you would by reading, but of course, with reading you’re not necessarily going to fail, so you kind of have to be okay with that, understand that’s part of the process.
We talked about the three things to look for when you’re looking for a syndicator. One is their track record and history, number two is references, someone that you trust having invested with them before… And three, making sure that you always have a one-on-one personal conversation with the lead sponsor.
We also talked about how you were able to grow your blog traffic to 50,000 users per month. Like most things in life, there is no magic formula. For this it was all about consistently posting high-quality content; for you that was about three times a week… And then as well as engaging with people on your blog, as well as in the Facebook group that you created.
We talked about some of the benefits of that blog, putting you in the center of a community, which allows you to meet physicians and other professionals, which was giving you inspiration and you also felt good to help out people and connect with people that are currently in the situation that you were in the past. Then your best ever advice was simple, but also powerful, which is just get started, and take action.
Again, Peter, I really appreciate you coming on the show today and offering your advice. Thank you to everyone who listened. Have a best ever day, and we’ll talk to you soon.