The Importance of Having Great Tenants

This notice of a Milwaukee code violation (committed by my tenants) was sent to my old address in Pensacola.

A common mistake that new landlords and real estate investors make is not recognizing the importance of accepting the highest possible quality tenants for a given property. Rather, many will sign a lease with the first prospective tenant that comes along, or accept a tenant that says all the right things but does not complete a background and credit check, cannot provide proof of income, and can’t provide references for prior landlords. 

I recently experienced firsthand the value of having an exceptional tenant. I own and self-manage a single-family home in a great neighborhood in Pensacola, Florida. I also own a few single-family homes in Milwaukee, Wisconsin that are managed by a professional property management company. 

Since I used to live in the Pensacola property, I occasionally still get mail sent to me at that address. About a month ago, I received a text message from the tenant in Pensacola stating that I had two important-looking letters addressed to me from the City of Milwaukee. I immediately knew this was not your typical junk mail envelope, and my Pensacola tenant sensed that as well. A less considerate tenant may have just ignored the mail or thrown it away without alerting me. I asked her to open the envelopes and send me pictures of the contents. Thankfully she didn’t just throw them away, because the letters were notices from the City of Milwaukee that one of my Milwaukee properties was in violation of local ordinances. 

One of the Milwaukee tenants allowed the grass to become overgrown, and regularly left the garbage bins on the street. The notice from the city stated that if the issues were not corrected, I would be issued fines as the property owner.

One of my tenants in Milwaukee had not been keeping up with the lawn maintenance!

I immediately reached out to my Milwaukee property management company, Smart Asset Realty in Waukesha, Wisconsin, and told them about the situation. Thankfully, Smart Asset Realty is fantastic and told me they would contact the tenant immediately to remedy both issues and let the tenants know that if any fines were issued to me, the tenants would be reimbursing me for those fines. The property management company later sent me pictures of the recently mowed lawn and reminded the tenant that per the lease agreement, they are responsible for lawn care and correct use of the garbage bins. 

While the focus of this particular article is on tenants, this story also emphasizes the importance of having great property management and not just hiring the first company that shows up when you search for one. 

You may be thinking “if having great tenants is so important, why didn’t your Milwaukee tenants do the right thing and take care of the lawn better?”. This is a fair point, but I think the important thing to remember is that no tenant is perfect and you can’t expect every tenant to treat the property as well as you would. Also, I believe the Milwaukee tenants just needed a reminder that caring for the property is their responsibility. This is also the first issue we’ve had with those tenants. Thankfully the management company did their job well by handling this for me. This is why they make 8% of the total rent every month!

It’s also important to remember that folks who can afford higher rent in a nice area are not necessarily better people who will take better care of your property. You can have high-quality tenants even in a property with lower rent and you can have low-quality tenants in a property with higher rents! That’s why it’s so important to screen them well, regardless of their monthly income. 

Fantastic tenants will treat your property better, keep you advised of any repair or maintenance issues, pay on time (or early), and generally make your life as a landlord or property owner much easier. 

Thorough tenant screening will prevent a lot of problems!

Tenant screening tips to reduce landlord headaches:

  1. ALWAYS perform a background and credit check (or ensure your management company does this).
  2. Minimum 650 credit score.
  3. Get references from past landlords.
  4. Ensure the prospective tenants earn enough monthly income to afford the rent. My rule is they must earn four times the monthly rent each month, and I ask for a recent pay stub to verify this. 
  5. Have a conversation with them to determine why they are renting and how long they plan to stay in the home. You can learn a lot from a 10-minute conversation that you can’t learn from a rental application. 

Pro Tip: Be wary of any tenant who wants to pay 1 year in advance. This is a strategy sometimes used by individuals who plan to use the home for illegal activity like drug dealing. They pay upfront to reduce the chances anyone comes snooping around the property looking for rent!

I hope you enjoyed this article and found value in its content. Make sure you follow us on Instagram @honorandequity. We love hearing your feedback! Send us a direct message on Instagram, or email me directly at

Honor and Equity 2020 Year in Review

What a year! I started 2020 in Iraq – halfway through a 6-month deployment. Neighboring Iran attacked our base with ballistic missiles, which was a significant moment in U.S./Middle East relations. The COVID pandemic soon overshadowed the attack. Thankfully the pandemic didn’t delay our return from deployment in late March, but we came back to a very different America. 

I was excited about not having to go to work for the first month or so after returning. This freedom meant more time to read, relax, and spend time with my soon-to-be-wife, Caitlin. I enjoy reading, but I was voraciously consuming books, sometimes reading over 100 pages per day with all that downtime. We had planned to be married on May 9th in Miami (we live in San Diego), but like many people in 2020, we had to adjust our life plans. We were married here in San Diego, with only a few family members in attendance. It wasn’t the wedding we expected, but it was pretty fantastic, to be honest. Getting married to Caitlin was, without a doubt, the happiest and most significant moment of the year for me. 

Joining A Mastermind Group

The second most significant moment was when I decided to join a real estate mastermind group for military members and veterans. A friend and mentor named Stuart Grazier (of Storehouse 3:10 Ventures) co-founded the War Room mastermind with David Pere (From Military to Millionaire). I was inspired to join a mastermind group after reading “Tribe of Millionaires,” an allegorical book produced by the founders of Gobundance outlining the benefits of joining a mastermind. (Check out my article about mastermind groups here). Being surrounded by motivated individuals with goals that align with yours is critical for personal growth. I started virtually meeting active duty service members who own multiple properties – and not just single-family homes; I’m talking apartment complexes, RV parks, and mobile home parks. I thought, “Wow, I need to up my game!” So I did

I distinctly remember a post that Stuart Grazier made in our War Room Facebook group in which he challenged everyone to create a ‘thought leadership platform.’ This platform could be a blog, a YouTube channel, a Twitter account – basically any medium through which you can talk about your journey and experiences in real estate. I knew this was something I had to do, so I took action and created Honor and Equity, a personal finance and real estate blog for military members, veterans, and their families. I didn’t know how to design a logo, start a website, create content, or dance in TikTok videos, but I figured it out (minus the TikTok vids!) with the help of family, friends, and fellow War Room members. I’ve always enjoyed talking with anyone who will listen about personal finance, investing, and real estate. The platform would help me share what I have learned with others and document my journey. 

Investing in Oklahoma City

Photo credit Gerson Repreza via

I try to connect with a different War Room member every week because each person has a unique military and investing background. I enjoy hearing about what everyone is working on and what they have done in the past. One of these conversations inspired me in a significant way. Michael Barnhart is an active duty Navy officer like myself currently stationed in England. He told me about how he and his wife were aggressively pursuing real estate in the Midwest utilizing the BRRRR strategy (Buy, Rehab, Rent, Refinance, Repeat – a must-read book by David Greene, by the way). This conversation was my lightbulb moment: if this guy is doing the BRRRR method from England, why am I not doing something similar from San Diego? Almost immediately, I started researching markets and eventually decided on Oklahoma City (check out my article about why I decided on OKC). I re-read Long-Distance Real Estate Investing by David Greene and read his BRRRR book while carefully putting together a team of real estate professionals in OKC to help me achieve my goals. 

Progress has been slow, but I write down my goals every day to stay focused and stay in the right mindset. We finally closed on the first property – a duplex – on December 11th, and everything is going smoothly so far. The home is already rented and needs mostly exterior cosmetic work. We are going to do all the rehab work with the tenants in place and the work should be complete in January/February after which we will do a cash-out refinance. My goal is to acquire two OKC properties per quarter, so if you know of anyone involved in real estate in Oklahoma City, send me a message! I post updates occasionally via the @honorandequity Instagram page, so make sure you’re following to get the most up to date information.

Beyond OKC, we also own a single-family home (SFH) in Pensacola, and we just closed on our third SFH in Milwaukee, Wisconsin. We closed on this home in Milwaukee and the duplex in OKC within about 4 days of each other, which doubled the total number of doors we own (3 doors to 6 doors)! Back in April of this year, we invested in a mobile home park (MHP) syndication in Cañon City, Colorado (check out the article here). My favorite part about that MHP investment is I know about half of the other investors (who are also on active duty). The team who put the deal together is led by a husband and wife team (both Army veterans). You may have noticed a theme with my network: I like to work with fellow military folks! I think that someone with 10+ years of service in the military tends also to be someone you can trust that communicates well and has grit and integrity – the same type of person with which you want to invest.

The Milwaukee turnkey properties we own are performing better than expected (thanks Storehouse 3:10 Ventures!), and I hired a new property management company back in May, which was a fantastic decision. The Pensacola property is the star-performer, though: of the properties we own, it has the highest cash-on-cash return and has appreciated the most since it was purchased in 2016. 

Honor and Equity in 2021

Photo credit Immo Wegmann via

H&E has grown a lot since its inception in the summer of 2020, and we will experience substantial growth in 2021. This growth is driven by a desire to help fellow military members and veterans in their personal finance and investing journey. One of my favorite parts about doing this is connecting with people, so if you want to connect or know someone who might want to, please reach out!


  • Grow Honor and Equity via the creation of content designed to inspire and educate others within the scope of personal finance, real estate, and investing. 
  • Grow our portfolio in OKC via flips and BRRRR’s. Partner with others to scale and expand with the long-term goal of providing investment opportunities to other military members and veterans.

Thanks for reading this article! Please send me a message on Instagram @honorandequity or send me an email at!

My First Out of State Investment Property

Wisconsin Cash Flow!

My First Out of State Investment Property

I purchased my first property in Pensacola, Florida in October of 2016, and soon after buying it I became interested in learning more about real estate. I was consuming all of the BiggerPockets podcasts and purchased David Greene’s first book “Long-Distance Real Estate Investing”. This opened my eyes to the concept: live where you want to live – invest where the numbers make sense.

I listened to an episode of the BiggerPockets Money podcast with Stu Grazier, a fellow Navy officer and real estate enthusiast. He had just started a turnkey real estate company in Milwaukee, Wisconsin. Stu and his partner David Gutierrez (they were roommates at the Naval Academy) had a bad experience with a turnkey provider and were inspired to create their own company to help military members and veterans acquire cash-flowing properties. Storehouse 3:10 Ventures was born. I was immediately intrigued after hearing the story and contacted Stu via the BiggerPockets forums to learn more.

The Deal

Fast forward a few months, and I closed on my first out of state investment property in Milwaukee without setting foot in the state of Wisconsin. Here are the numbers:

  • Purchase price: $89,000
  • Financing: Conventional loan at 5.25%
  • Capital invested: $33,422

Pro Forma (Projected Numbers by Storehouse):

  • Monthly Cash Flow: $201.86
  • Cash on Cash ROI: 10.09%
  • Repairs and Maintenance: 5%
  • Vacancy: 7%

Savvy investors will wonder why I put so much capital in. When Stu and David purchased the home, it was a 2 bedroom / 1 bath, and they planned to convert the basement to a third bedroom – which they did. However, the appraiser would not recognize that third bedroom, so he classified it as a 2/1 instead of a 3/1 and the appraisal came in at $78,000: $26,000 lower than the expected After Repair Value (ARV). This is the worst news a home flipper can hear! Stu proposed we split the difference and draw up a new purchase agreement for $89,000. This was all very new to me, but I trusted Stu and David and I liked how the home would still rent as a 3/1 (I cared more about the cash flow) so I agreed to the lower purchase price. The lender would only finance 80% of the appraised value (78k) so I had to come up with the difference between what they would cover and the updated purchase price (89k).

The Storehouse team was fantastic about helping me along through the process. They always answered my questions quickly and honestly (and still do!) – which I appreciate immensely and speaks to their integrity as business owners.

The First Year (2019)

First Year Performance Numbers (Pro Forma Estimates in Parentheses):

Monthly Cash Flow: $406.43 ($201.86)

Cash on Cash ROI: 14.59% (10.09%)

Repairs and Maintenance: 12.3% (5%)

Vacancy: 12% (7%)

I learned a lot in the first year! I especially learned how important the property management is once you close. I have since switched to a different property management company due to issues with communication and their accounting practices. I also think they could have done a much better job screening my first tenant. She ended up not paying the rent 4 months into the lease, but thankfully left the property and turned the keys in. I used her security deposit to cover that month’s rent, but then I was left with a vacant property for 6 weeks until the PM was able to find a new tenant, which was very frustrating.

You’ll notice the repairs and maintenance expense was much higher than expected. I don’t know the exact reason for this, but I suspect the previous property management company was not finding the best deals for work performed on the house. For example, there was a possum trapped in a window well, so the PM contacted an exterminator company who charged over $200 to remove a single possum. Time will tell if my R&M expense decreases for the 2020 tax year thanks to the new PM. More to follow on that.

I’ve been with the new property management company (Smart Asset Realty LLC) for a few months now, and it’s been fantastic so far. I set expectations from the beginning and made sure they knew how important communication is to me. I was also able to visit their office in Waukesha, Wisconsin, in person, only a few weeks ago. I was very impressed with their spaces, the team, and the excellent company culture they have.

Would I Do This Deal Again?

Absolutely I would. It cash flows more than Storehouse projected it would and the property has appreciated to about $100,000. I plan on holding this home for a long time, and I recommend the Milwaukee market for anyone looking for strong cash flow. I was so happy with the turnkey experience provided by Stu and David that I purchased another home from them only a few months later.

Turnkey is a great way to get into real estate investing, especially for military members. I actually wrote an article about this already so check it out!

I hope you enjoyed this article. Please share with a friend and follow me on Instagram! @honorandequity

Photo courtesy

3 Reasons Turnkey Properties are Great for Military Investors

It was only a few years ago that I started to learn about real estate. I listened to the Bigger Pockets podcast regularly (I still do), and I still reference Bigger Pockets books when I have questions about real estate fundamentals such as managing properties or finding tenants. One of these books in particular was integral in my “lightbulb” moment: “Long Distance Real Estate Investing” by David Greene. The most significant takeaway for me was that I don’t have to live in the same place I purchase real estate. Around the time I finished this book, I listened to a Bigger Pockets episode featuring a guy named Stu that also worked in Naval Aviation who was the co-owner of a turnkey real estate company called Storehouse 3:10 Ventures. I didn’t know much about turnkey, but Stu certainly did and he seemed like a good dude so I reached out to him. Fast forward three years, and I own two properties purchased through Stu’s company, and I’m an investor in a mobile home park syndication partially sponsored by Stu and David his business partner.

Many service members recognize the value in real estate as a wealth-building tool, but don’t have the experience or knowledge to get started. The turnkey real estate investing model is perfect for these individuals. I have purchased two homes using this model, and I’m on a waiting list to buy a third in a few months.

You may not always decide where you live, but you can decide where you invest!

What is Turnkey?

Turnkey real estate providers purchase homes, rehabilitate them, and sell the homes to investors. Sometimes these companies also provide property management – these are usually called full-service turnkey providers. When done correctly, this is a win for all involved: it provides a cash-flowing property from day one to the investor, it puts money in the pocket of the turnkey provider, and it provides a newly rehabilitated home to the tenant.

Let’s take a look at 3 reasons why turnkey is a great option for military investors.

  1. Location – Invest Where the Numbers Make Sense

Military folks move a lot – usually every 2-3 years – to locations that aren’t always conducive to long-term real estate purchases. Sometimes the numbers just don’t make sense! When I moved to San Diego in 2018, the type of home I wanted to buy would have rented for less than the mortgage payment, so I didn’t buy a home and chose to rent instead. This is common in high cost of living markets (HCOL) with military bases like Hawaii, San Diego, and Washington, D.C. However, you can purchase turnkey rental properties from anywhere in the world. I purchased two rental properties in Milwaukee, Wisconsin from San Diego – having never set foot in the state of Wisconsin. A friend of mine is on a waiting list to buy a turnkey property, and he and his family are about to move to Japan! Not everyone will be comfortable doing this, but it just shows what is possible if you have a team with people you trust.

2. Price – Turnkey Properties Typically Cost Less than the Average Home

The average home price in the U.S. is typically around $200,000. You can buy a turnkey property for as low as $75,000 depending on factors like location, size, number of bedrooms, etc. You can also obtain a conventional, 30-year fixed rate home loan with 20% down (plus closing costs). That means you can acquire a cash-flowing real estate asset for around $15,000. This makes it a (relatively) affordable real estate investment, which most money-conscious military members should be more than capable of saving towards. It may take some time, but it will be money well spent, and you have much more control over this asset than money in your TSP or IRA. Also, many service members go on deployments to combat zones. This is a fantastic way to save a large amount of money since your expenses will likely be very low, and there’s the added benefit of combat pay, hazardous duty pay, imminent danger pay, sea pay, etc.

3. Simplicity – Turnkey is a Simple, Low-Stress Way to Get Started in Real Estate

When you mention ‘real estate investing’ most people think about home flipping because of all the HGTV shows. Flipping homes for profit is a lot of work, even if you aren’t performing the improvements yourself. You have to identify properties with numbers that make sense, then you have to build a team! You need to find a reliable general contractor, a proactive real estate agent, and money lenders that believe you will provide them a return while also making the project worth your own time and money. Turnkey providers have this system in place already so you can continue your day job in the military weaving that red, white, and blue blanket of freedom for Americans and others around the world. Also, you will learn a great deal about real estate investing by owning a turnkey property, including due diligence when purchasing a property, basic bookkeeping, and interacting with your property manager about tenants, property repairs, and more! Most real estate investors start out in the ‘single family home’ asset class because it is relatively simple and easy to grasp for beginners. Turnkey can be a fantastic gateway to the highly lucrative world of real estate.

Trust is the Key

A crucial element in investing in turnkey properties is ensuring that you completely trust the team you send your hard-earned money to. There are many sub-par turnkey providers out there just looking to make a quick buck. Many investors have lost a lot of money to unethical or incompetent turnkey companies, so make sure you research the company, get references, thoroughly read the purchase agreement, inspections, and appraisals, and do not hesitate to back out of the deal if something doesn’t seem right.

BONUS – You Can’t Use your VA Loan to Purchase a Turnkey Property

Since the Veterans Administration requires you to live in a home you purchase using the VA home loan, you can’t use your VA home loan to purchase a turnkey property. This means you need some cash saved up for a down payment, and you need pretty good credit. But don’t worry if you don’t have either of those yet, just continue to spend less than you earn, pay your bills on time, and your personal balance sheet will quickly start to improve!