Grant Cardone on 5 Steps to Becoming Millionaire, $2B in Property, NOT Buying Home (Full Interview)

Alright, here we go, Grant Cardone, welcome back to Flat TV, man, I'm glad to be in your shoes this time, yeah, yeah, you can visit our New York office, yeah, it's awesome, it's awesome, yeah, well , this time you contacted us. I'm a little flattered, yeah, man, because look, I love that

interview

we did last time and your audience is different than mine and a lot of the people who follow you seem to be really turned on or converted. I don't know, but I think a lot of people started thinking about Well, you know, how do you play with the IRS?

How is the money game played? and nobody knows that nobody teaches assists, so I say: let me see the big V. man again and we educate or annoy his audience a little more. I think what I appreciated most in our

interview

last time is that so many people try to sell people a dream and say that you don't need a good job to start investing in real estate, you can start with zero money down and drop out and you know. , get rich after a few years and you said: look, if you want to make real money, you guys have to do 32 business units, you know, uh, multiple units and you don't need a lot of money up front to do it and if you don't want to, yeah you can't do it, don't even bother, yeah just look, you'll end up having another job. that doesn't pay you anything, like if you hate the minimum wage job you have now, you'll hate the next one more.

You know, I'm saying that people are trying to get by by having two or three jobs that don't pay anything just because you supposedly own something, which means you have a mortgage on it that doesn't belong to you and even if you paid for it, you still you have to pay

property

taxes just because it makes a little money. I don't want to say it makes sense, yeah, and I could tell you that I have a close friend who is a real estate developer in DC and I ran him through some of the numbers and I said, well, Grant said, you know, because I'm not a guy. of real estate.

I know I said well, great, he said you should start with at least 32 units if you want to get into real estate and he said, well, I actually feel like it's a hundred oh bucket, you know 32 was good too. I could have that argument like like you, once you make a hundred, you'll never go back to 32 it's like you know, you know what that says, so once you scale, it's going to be like Amazon saying or Blackstone saying they're going to buy my business. as a friend, we would never do that again, you know we're going to buy, we're going to get about 50 billion at a time, we're not going to bother with a small company and this was the point that now a lot of people just look at, like you know, Vlad, about this, they just get angry and say, well, I can't do that because I don't have the money, okay, I didn't have the money either.

I started with a deal, I bought a deal, I put in three thousand dollars. below I bought a deal on a budget it was like I was going to Whole Foods to buy groceries how much can we pay? I have two hundred dollars something worth you, you can't do that with an investment. and I did it and then that three thousand dollars made me two hundred dollars a month I thought it was going to be great I thought everything was going to be beautiful there is no reason to tell this story except to share with people a deal I don't work because in the The moment they moved I was negative.

I panic. I left the

property

. I shouldn't have abandoned her, but I had to because I didn't have the cash flow, I didn't have the courage, and I didn't have the knowledge. that the market would change and then rent it. I was terrified that that deal today is probably worth 450 grand and I put $3,000 on his horse, he's up five times, but if you can't keep him, that's the problem. with the stock market for me, you know I couldn't hold Apple stock through the ups and downs. I never get to 258 right, so you haven't bought any stocks since our last interview, uh, not a single one, buddy, well, I failed, I mean.

I can't do it I can't do it because as I drive around here this you know it's too easy it's too easy around $250 where the stock still can't know what you got I got you I got you good after doing it In our last interview, this was the kind of number one complaint comment that I kept seeing over and over again and it was when you said

buying

your house is a dumb idea, yeah people think the reason you say that is because you own a lot. of rental properties and you're trying to trick people into not owning anything so they can come rent with you oh yeah that's what I'm doing why not look you know the only people that are trying to give you meaning to a house or people who are trying to sell you a house, I'm not trying to sell anyone anything, I'm trying to help people create financial freedom for themselves, there is not a single report in the history of the world, seven billion people from someone who has created financial freedom. freedom because they bought a house Jamie Dimon right here is on what he's on CNBC this morning talking about how great the economy is and the stock markets going up and the economy is going to be great in the next hundred years, he's not thinking about people

buying

a house. house when he says those things, he's thinking about his rich friends from flying Gulf Streams and Global's and you know these are the richest people on the planet, these people don't even talk about the house that Don Donald Trump bought on the street he buys one house he doesn't buy a house he buys the whole building and lives in it now the everyday god who says well I can't do that man yes I can I can buy a little bit of the American dream by buying my house and you I know someday it will give its fruits.

Fly over San Pablo Sao Paulo Brazil. You're going to see so many vertical buildings. I thought they were all office buildings. They are not office buildings. They are all residential. Millions of people living in small boxes. heaven under the belief that they are going to own it one day it will be worth a lot of money it is not going to be worth a lot of money is trapping people people are making their biggest investment in their house when they should make the same investment in themselves or in their business, not in other real estate, by the way, it should not be real estate, it should be in themselves, or an idea or a business that produces cash flow, or real estate that produces cash flow, Airbnb is kind of the newest thing.

What's going on right now when it comes to the real estate market, so a lot of people feel like, well, I'm going to buy a house and I'm going to air it out as a B&B. From your point of view, is it a real business or just spinning the wheels I think it's going to be I think it's an economic opportunity right now that's going to last so I don't think it's going to last I don't think all the trips and trips and stays require a good economy, so if I go back to 2010 I know some people who are making a lot of money in the Airbnb education business.

They are educating people on how to do what you just mentioned. I don't know many people who make a lot of money doing it, but I do know. a lot of people educating people on how to make a lot of money doing it in the economy when the economy crashed in 2010, you know, the first thing that happened was hotels, travel, airlines, spending money, period when people stopped traveling, companies stopped sending their salespeople. Along the way everything came back

home

and the same thing as the air B&B that this money has to be converted into is that these overnight stays have to come from somewhere, so when I come to New York I stay at the Peninsula or the Four Seasons Marriott. one of the hotels in the area right on the plaza or, wow, I'm going to go to an air B&B now I'm going to stay at someone's house, but if I don't come to New York on business anymore because the economy is crushed, what? guess what? everyone gets hurt on the peninsula, at the Four Seasons, in the plaza, they got money, although they got, they can stay, but the air B&B God who depended on Airbnb trips, all of a sudden, that guy gets hit and can't get his 80 dollars today than his models built for half the year, blah blah blah, he did the math and only has one unit again.

You're still stuck in a business that doesn't have reliable cash flow and a business is only as valuable as the dependent, the cash flow is reliable, yeah that's a great point, that's a great point, you touched on this with what you just said. say, but a lot of people feel that the recession will come in 2000 2020, do you feel that's true or do you think this is just? people overreact the way they do, oh, I wouldn't hesitate if we weren't in this right now, as you know. I see these guys on Wall Street talking about how great the economy is for who, man, who it's great for.

I have 175 employees working for me in Miami, 80 or 90 of them without even doing a survey. I know 80 or 90 are having problems and I take care of people. I pay people fairly but I can only pay them a certain amount, the cost of living in most cities is so high in this city it's ridiculous the cost of living after taxes after renting a place after the cost of food, transportation, and insurance, and it's just as high and businesses aren't paying more money as if we had the lowest unemployment we've ever had. Maybe 50 years since I've been alive, salaries should be rising and they're not.

So why isn't it like the rich are getting richer and everyone else hasn't had any positive experiences? We actually posted about an article that is a little mind-blowing. I'll wait a second. Let me open this. It was actually on Bloomberg and they said the richest 1% of Americans are about to surpass total wealth or the middle class, yes, yes, yes. crazy, how crazy is that when you say I was crazy, it's crazy, you're talking about massive changes, wealth transfers, now the question is always who has my money, this is what your viewers should be watching wondering right now who has my money and you should be mad about it, you should say who has my money, not in a protest, but, but, from a hunting point of view, you know, I was 25 and broke, I had no money, but I got angry.

I wonder who has my money, who has it, who has what I want, who has my dream, who has my business, and that's what people need to ask themselves today. The rich are getting richer because the rich are played by a different set of rules than everyone else Americans the middle class they are buying houses this goes back to the point of origin they are buying houses they are buying cars they are buying country club memberships yes They can afford it, they send their kids to good schools, they borrow money to go to college, they save their money and invest in retirement accounts, those are basically the seven themes of the middle class and it doesn't work for the rich, they don't do any of those things.

Things, okay, they don't borrow money to go to college. college they send their kids to the best college and tell them: hey, don't worry about learning anything, but meet the Obamas, okay, make sure you know the people with the right names, number two, don't worry about buying houses, buy businesses that don't. They don't save money, they know it's rubbish and they invest in companies and will do whatever it takes to get rich. The priority is to create wealth for themselves and their families and they do not invest in retirement accounts. We talked about a lot of offers last time in our interview and you know you mentioned your first deal of buying a single-family

home

and dealing with a tenant who moved out.

You know you ended up getting out of it, other than that when you look. In your most important businesses, what was the worst deal you had? The worst deal I ever had, did or didn't do. You did it well. The worst deal I ever made. I probably made a deal. I bought a deal three years ago. I called her at the 32 million point, it was a turnaround, I mean, I made a ton of profit on another deal I had sold in South Carolina. I had about twenty-three million dollars in profits to protect, so I moved some of that into an exchange.

It's very 1031. It's pretty complicated, it's simple, but it gets complicated when the ticking, when the clock starts ticking, okay, you three days left and you have to identify, then two days, then one day and then It's like no, I had to pull the trigger so I bought a deal knowing there wouldn't be much upside but it would protect my trade from taxes and I stuck with that deal for thirty-four months. This is a bad deal maintained. for thirty for a little less than thirty-four months that we had, I think on that deal maybe four million dollars, a profit of four million dollars on that deal less than that, maybe a little less than four million, okay , so when you sold it you made four million on the deal. uh, let me see, that's right, it could be, yeah, that's shy of four million dollars that I made on that deal, the cash flowed in like eight percent a year, so it wasn't like that, it wasn't typical of what I would expect from the deal. . a twenty five percent return in three years about eight percent a year I didn't lose money I didn't lose my trade I had a profit but it wasn't a scorching score and I didn't love the property it's okay so of all the properties I've ever you bought, you never had a sale to sell at a loss.

I have never sold to an apartment dealer, theright girl For my life, I was going to end up with a lot of girls in my life that I didn't respect and didn't want to spend my time with and I finally got the right girl, two beautiful children. and I think something I feel good about myself I remember Vlad when I was 16 17 18 19 or 20 I hated myself I had no self esteem at all today today when I wake up I mostly feel like you know on a scale of 1 to 100 , I think I'm going to give myself a 94 today, better than my grades in college, that's what Grant Cardone is, you're the man, the danger, it's always a pleasure, I appreciate you reaching out, this time, and I I mean you.

I can't wait to do it again. You got it brother, it will be great, without a doubt, peace.