April 5, 2021

JF2407: Find Your Real Estate Passion with Kristen Ray


Kristen is a Family Nurse Practitioner from Baltimore. She discovered her passion in real estate with an apartment complex. Real estate helped her get through the education for nursing. She balanced being a practitioner and real estate investor. Being able to get into real estate it became her passion and decided she wanted to focus on this field.

Dr. Kristen Ray Real Estate Background

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Best Ever Tweet:

“Let some money work for you. You don’t have to always work for your money.” — Kristen Ray


Ash Patel: Hello, Best Ever listeners. Welcome to The Best Real Estate Investing Advice Ever Show. I’m Ash Patel and I’m here today with our guest, Dr. Kristen Ray. Kristen is joining us from Ellicott City, Maryland. Kristen is a family nurse practitioner and a real estate investor. She started in 2011 and her portfolio now consists of over 150 units. Kristen, welcome.

Kristen Ray: Thank you for having me.

Ash Patel: Thank you for being here. Before we get started, can you tell us a little bit more about your background and what you’re focused on now?

Kristen Ray: Sure. Thank you for the intro. I’m a Baltimore native, so I’m from the Baltimore area. My background, as you stated, my formal training is in nursing. I got into real estate in 2011, after becoming an accidental landlord. So long story short, for all you ladies out there, you may be able to relate. I had a six-month-old baby, I was in school for my master’s, my great grandfather passed away and left some properties. Those properties got handed down to my brother and I; we thought about selling them but decided to keep them. Fast-forward, two years after that, I went back for my doctorate degree. I didn’t want to take out student loans as most people don’t, and decided to use those properties. I leveraged them to pay for my degree. That was the moment when I realized I was doing everything wrong. So here we are today, a few deals later and a few years later, and I’m still here.

Ash Patel: How many properties did you guys inherit?

Kristen Ray: Four.

Ash Patel: Okay. Single-family homes?

Kristen Ray: Yes.

Ash Patel: And near where you live in the Baltimore area?

Kristen Ray: Yes.

Ash Patel: Okay. And they had tenants in them?

Kristen Ray: Yes. And those same tenants are still there today.

Ash Patel: Wonderful. So that’s what gave you the real estate bug. You mentioned you were doing things all wrong. Explain that to me, please.

Kristen Ray: Well, in terms of looking at finance, there’s always the work hard and save your money.And yes, while that has some truth to it, there are also ways to amass wealth and other ways to amass cash when you need it. This was evidenced by the leveraging I did with the properties.

Ash Patel: Was there a moment where you just got your first rent check? Or did you have a moment where there was just an epiphany, where a light bulb went off, and you’re like “Whoa”?

Kristen Ray: That was it. When I got the check at closing after we did the refinance, that was my lightbulb moment. Because I said, well, essentially the tenants are paying for me to get my doctorate degree. I didn’t have to take out loans, I didn’t have to look for scholarships, I didn’t have to do whatever it is a lot of people do to get money to get capital to use for that purpose… Rather, I used an asset that was cash-producing, that appreciated, so I had some equity there, and it’d still cash-flow afterward. So essentially, someone else paid for me to go back to school to pay for my education.

Ash Patel: That’s a great way to look at that. So you started in 2011 when you inherited those properties, and now you have 150 units. How did you start out on your own, besides the inherited properties?

Kristen Ray: So after those properties, I was at school obviously, and I was also doing some additional homework in the real estate sector to see what else can I do to continue this, because I really like it. So I went out and decided to get another property on my own, and went through the rehab – the whole BRRRR method, basically. And I realized it was a very taxing process. I wanted to be able to have a certain amount of cash flow and to be able to scale my portfolio, but I knew having 100 gingerbread houses was not my preference. So I started looking into commercial real estate and larger deals.

Ash Patel: So going to school for a PhD wasn’t enough, you were also learning real estate. Explain to me the multifamily process. Was it just the one single family that you acquired?

Kristen Ray: It was actually a duplex.

Ash Patel: Okay, and then what was your next deal after that?

Kristen Ray: My next deal after that – I did a few wholesale deals, and my next one was the apartment complex.

Ash Patel: And you were very passionate about real estate at this time.

Kristen Ray: Oh, absolutely.

Ash Patel: So you’re all in… Tell me more about the apartment complex.

Kristen Ray: It’s 146 units in South Carolina; myself and my partners, we acquired it almost a year ago today, this [unintelligible [00:05:18].22] right before the pandemic hit.

Break: [00:05:22][00:06:28]

Ash Patel: Who’s your partner? I don’t need a name, but how’s your partner involved in the business is my question.

Kristen Ray: Oh, okay. He’s also a syndicator. He also has a portfolio of multifamily properties and single-family properties.

Ash Patel: Okay, so you didn’t just go from a duplex to a 146-unit apartment building, did you?

Kristen Ray: Essentially.

Ash Patel: Oh, you took the fast track. Okay. How did you find that 146-unit building?

Kristen Ray: Well, the lead came in through my partner. I met my partner through networking back when we could network in person, pre-COVID.

Ash Patel: And what’s your involvement in this? Are you 50/50 partners?

Kristen Ray: No, we’re not 50/50 partners, but I’m a general partner in the deal.

Ash Patel: Okay. And then how many syndicators are in this deal? Or how many investors rather?

Kristen Ray: Passive investors, I believe 60-ish investors.

Ash Patel: Okay. A lot of these came from your partner having a track record in syndication?

Kristen Ray: Yes. That was definitely helpful when we spoke to investors about investing.

Ash Patel: Okay. And you’re still a full-time nurse practitioner?

Kristen Ray: Not quite full-time, but I do still practice.

Ash Patel: Okay. How do you balance the two?

Kristen Ray: Well, I don’t practice as much… I do practice a certain number of hours to keep my licensure; that I’ll always keep, because I’ve worked very hard to acquire it. But my primary focus is real estate.

Ash Patel: Okay. In this syndication, what was your direct involvement? Did you help find investors? Did you do investor relations? Did you help identify some of the issues with the property? Underwrite it? Take me through that.

Kristen Ray: So my role – I helped with the due diligence, underwriting, and also investor relations.

Ash Patel: Okay. What were some of the big things that came out in due diligence?

Kristen Ray: There was some deferred maintenance that we’re still working through. That was one of the big things. Also the financials. The seller didn’t quite keep those in order. But I will say those were some of the larger undertakings.

Ash Patel: What are you focusing on next?

Kristen Ray: That’s a good question. Next – still looking at multifamily, considering an assisted living facility, just from a landlord perspective; I don’t want to operate the business aspect. But I consider myself an opportunist, so I will always have my eye out.

Ash Patel: So you wouldn’t use your background in healthcare to essentially manage the assisted living facility? Or would you be the medical director for that?

Kristen Ray: No, I wouldn’t be interested in that role. I would certainly want to be in a landlord sort of role. Maybe I purchase the building or several buildings, and maybe partner with an operator; that would be something I would consider.

Ash Patel: So what are you doing to find more deals?

Kristen Ray: Oh, Ash, that’s a great question. Like everyone else, I’m keeping my eye out and looking, talking to brokers, talking to other investors… That’s pretty much what I’m doing to try to get leads.

Ash Patel: What’s one of the biggest mistakes you’ve made in your real estate investing career?

Kristen Ray: Not starting sooner.

Ash Patel: What’s your next biggest mistake?

Kristen Ray: My next biggest mistake, I would say, not choosing the right contractor. So that’s very important. That’s probably one of the hardest aspects of the business if you’re doing some sort of value-add, is choosing your contractors very wisely.

Ash Patel: And do you still look for single-family homes or are you only looking to take down much larger deals?

Kristen Ray: I’m open to both. I’ll still build my personal portfolio as well with the syndications. So I’m still interested, but I’m very selective of both. So any single-family or residential properties, I’m only looking in particular areas. I’m very niched down there.

Ash Patel: I have to ask you this question – with you being in healthcare, a lot of medical professionals seem for whatever reason to not know much about real estate investing, or not have the opportunity to learn about real estate investing. Have you found that?

Kristen Ray: I would say somewhat. I have run across quite a few health care providers who do invest in real estate and are very interested. But on the flip side, I have some that I’ve met that are strictly into the stock market. So I usually find it’s one or the other.

Ash Patel: Do you do anything to try to encourage other medical colleagues to get into real estate?

Kristen Ray: Oh, absolutely. I talk to them all the time, I’m networking with them to let them know the kinds of opportunities… Oftentimes, people in healthcare tend to be in a higher tax bracket, so just kind of letting them know, “Hey, there’s a few other ways you could invest your money outside the stock market and maybe get some tax breaks on certain aspects of your income.” And just showing them another way to build wealth. I always tell them, if you don’t find a way to make your money work for you, then you’ll always work for money.

Ash Patel: That’s great advice. I was going to ask you, Kristen, what’s your Best Ever real estate investing advice? I think you just said it, but go ahead.

Kristen Ray: That’s it.

Ash Patel: No, take it from the top. Let’s go.

Kristen Ray: My best real estate investing advice is to let your money work for you. So you don’t have to always work for your money.

Ash Patel: Great advice. Kristen, are you ready for the lightning round?

Kristen Ray: I’m ready, Ash.

Ash Patel: First, a quick word from our partners.

Break: [00:11:50][00:12:26]:25]

Ash Patel: Kristen, what’s the Best Ever book you recently read?

Kristen Ray: I recently read a book called Your Money or Your Life by Vicki Robin. I loved it and I highly recommend it.

Ash Patel: I haven’t heard that. What was your big takeaway from that?

Kristen Ray: My big takeaway from that is your time is much more valuable than money, and that spending your time… Just a different way of looking at how you spend your time.

Ash Patel: That’s a great perspective, and I think that’s a lesson that a lot of us learn as we get older, that would have been ideal to know much earlier. Kristen, what’s the Best Ever way you like to give back?

Kristen Ray: Through youth programs. There are some youth programs that I am a part of and I sit as a board member, to help youth that are at an economic disadvantage, to help them with their educational needs.

Ash Patel: Fantastic. Kristen, how can the Best Ever listeners reach out to you?

Kristen Ray: My website. Please schedule a call. It’s vitalinvestmentpartners.com. Book a call with me. I’m happy to chat.

Ash Patel: Kristen, thanks for being on the show. You’ve given us great advice. I love stories about accidental real estate investors, because that’s how I got started as well. So you went from being a nurse practitioner, studying real estate while also getting your PhD, which is a monumental task… Then you got into doing your own deals, and now you’re into syndications and taking down some large deals. So Kristen, thank you again for being on the show. Best Ever listeners, thank you.

Kristen Ray: Thank you, Ash.

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