Real estate investment team Gwynne Wharton and her husband John currently own 5 commercial units, 7 single-family homes, and 2 homes used for Airbnb rentals in Charlotte, North Carolina, and Greenville, South Carolina. In addition to their 14 investment properties, stay-at-home mom Gwynne also manages her family and 4 children. She describes herself as the visionary while her husband John is the numbers guy.

Gwynne was kind enough to take time out of her busy schedule to answer a few questions for this month’s investor profile. Here’s what the husband and wife real estate team had to say about why they invest in buy and hold property in the Carolinas.

1. How did you get into real estate – what’s your background, how did you get started, and how does it fit into your life?

My husband and I went to college together, and we both got our undergraduate degrees in the same year. We moved to Charlotte, North Carolina right after college, and we bought a condo together. At first, he was working at a bank, and I was doing PR/Marketing for a small accounting firm. When the economy crashed in 2008-9 we realized that neither of our careers was stable enough to last. We decided that we needed to do something else with our lives. We thought about what would be the most secure thing for us as a family financially. We thought about staying in the condo, but the price of doing so was just crazy high. So, we chose to rent our condo instead. We had a background in restaurant management, and we started talking to a few real estate agents in the area. We made a $20,000 down payment on our first commercial investment with them, and then we went right back to school to get our CPAs (we wanted to be able to support ourselves). Our real estate agent had been selling homes for over 10 years, and she knew where all the good commercial and industrial properties were hidden. She made us go look at some places that she really didn't recommend at all that showed up on her call list. Many of them were in rougher areas, but some of those turned out to be really great buys. She even made us drive by a couple of houses that she thought we would never buy. Those houses were in such rough shape that I would have never wanted to look inside. They went on the market at $10/sqft, and we bought them for $4/sqft. We did a lot of hard work for almost no money down to fix those houses up into rentable spaces, and now they are all cash flowing very nicely!

2. What's your favorite rental property?

I've been really lucky that I have been able to rent all the properties from our investment portfolio. My favorite experience was when we bought a house out in the country by a lake in South Carolina, and we rented it all year round. It was just so much fun taking kids on camping trips, boating, swimming, and playing with their cousins. We also rented out a single-family house in Charlotte for several years. It was a total CASH FLOW machine! That house had 4 bedrooms and 2 bathrooms, and it was just the perfect size for us since we started out with zero real estate investing experience at the time (besides looking at a few houses).

3. What's a bad investment story you've had?

The only bad investment that has happened in our portfolio was when we decided to buy a house in Charlotte, NC. But we ended up really liking the neighborhood and were planning to stay for at least another year, so it wasn't the worst investment ever. The problem was that we NEVER should have bought that house in the first place. We wasted a lot of time on it, and it turned out to be one of the hardest properties to rent out because the house was right next door to the city bus station with all of its noise and traffic coming from all directions. It took us FOREVER before we started getting traction with renters there. After a year and a half of very slow showings, we decided to sell the property so that we could move on to something else. We made just enough money to make it worth our while, but it definitely wasn't a big win in the long run.

4. What's a good investment story you've had?

The best things that have happened to us as investors are the things that we didn't expect. The house next door to the bus station is actually one of those unexpected gems because it was almost like getting a really cruddy credit property for free! We actually ended up really liking the neighborhood because it was close to all of our favorite restaurants and shops. Compared to other neighborhoods we looked at in that area, it was also very affordable. We were able to buy the house for only $60k (the worst part of the house was under renovation and off the market), and we sold it 8 months later for $115,000…which made that house a huge win for us. The house is still cash flowing very nicely for us now. We also did some renovations to the whole place. It was our first renovation project, and we learned a lot about what it takes to get the job done right. We invested the money that we made on that project into turning another commercial property into a duplex, which is in the process of being rented out now.

5. What are your favorite things about investing in buy and hold property?

One of my favorite things about investing in buy and hold property is having complete control over the properties that I rent out. We have complete control over the utilities; we can let the tenants run their own, we can paint and upgrade the properties if we need to, etc. We are even able to purchase furniture that works for our renters' needs. We control everything about a property on every level, except for what goes inside. That is something that you can't really do in a rental property where you are just an investor. For us as investors, it's more of a lifestyle choice than anything because we have chosen to take on this financial risk and wait for returns on our investment.

6. What's the most important advice you'd like to offer someone who's just starting out?

Don't try to do it all. Trying to be a real estate investor instead of just renting out your property could end in disaster if you don't know exactly what you are doing. We were really lucky that we had taken apart a house before we ever tried investing in commercial properties, and I think that is one of the best pieces of advice that I could give people who are new and starting out with real estate investing.

7. What do you think of brokers or agents? Why or why not?

I believe that they are helpful, but they can also be very hit-or-miss for some people. It really depends on who you are dealing with. We've had some good experiences with brokers, and we've also had some absolutely horrible experiences. It's really critical to know what you are looking for in a broker. If it's someone who is just going to help show the house that you listed, then that is okay. But if their only goal is getting you into a property that they can sell for commission, then I would look for someone else (or try to avoid them).

8. What advice do you have for people who want to invest in real estate?

When you get into this industry, make sure that your finances are in place before you get started. That means that you have some kind of savings to be able to invest in something like real estate and that you understand what kind of return you are expecting on your investment. You don't want investments where you don't know what is going to happen in the future, such as with a rental property. It's one of the worst investments because if it takes a while for rents to increase, then it could be very hard financially for you when it comes time to sell the property and get paid back.

9. What's the best book on real estate investing that you've ever read?

The best book that I've ever read about real estate is Rich Dad, Poor Dad by Robert Kiyosaki. The book itself is a great read, and it's even better to get into his courses. Robert Kiyosaki has an incredible story, and he has some very good advice for people who are just starting out (or even people who aren't). It's one of those books you will want to keep on your shelf for life. It literally taught me how to think differently about money and helped me realize what my financial goals were as well as how I should be saving for them.

10. What's your best investment advice?

Be disciplined and know what you are getting into before you actually make any investments. That means that you should have enough savings to cover any expenses that come up while you are investing. If it takes a while for a property to make money, then be patient and stick with it! Good or bad, the worst thing is quitting halfway through an investment. It's better to stick with an investment until the end even if it doesn't turn out exactly as planned. It's better to try and fail because you haven't started a fire than not trying at all!

11. On the flip side, what advice do you have for people who want to buy their first investment property?

First of all, always look at properties that are under market. You want to make sure that the price that you can get on a property is going to pay you back and give you a good return on your investment. Second of all, make sure that it's beneficial for your lifestyle and not just an investment. If the only reason that you are buying a house is that it's an easy way to make money, then be careful about whether it's going to be worth it in the long run!

12. What advice do you have for people who've already started investing in real estate?

Don't lose sight of the bigger picture. As I mentioned before, there are plenty of cases where people get sucked into investing in a property because it's just an easy way to make money. But if you can't sell it, then what good is it going to do for you? If all you are doing is looking for properties that will gain value and not make sense to sell later, then that's a much harder lifestyle choice than simply investing in properties that you want to live in or rent out yourself!

So there we go. That was our conversation with the husband and wife real estate team.

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