034: The Real Estate Empire Path to FIRE | Matt McKeever

Today, we’re chatting with Matt McKeever—a FIRE and real estate YouTuber, CPA, and entrepreneur who achieved FIRE at age 31. Matt shares his journey to FIRE and tells us how he built his Canadian real estate empire to over 120 units!

We’re also joined today by guest co-host Shaidah, who, like Matt, brings a wealth of real estate knowledge to the show. Shaidah also appeared on Episode 27: Let’s Talk Real Estate. Thanks for co-hosting with us, Shaidah!

Disclaimer: Some of the links on this page are affiliate links. That means we may receive a commission if you make a purchase after clicking through our links.

Click to view transcript

Money Mechanic
Hello, listeners. Welcome to Explore FI Canada, where we sit at the roundtable with Canadians, and share their thoughts, ideas and personal journeys to financial independence.

Thanks to Matt McKeever for sponsoring Explore FI Canada. Matt is a Canadian investor, CPA, entrepreneur, and real estate expert who achieved FIRE at age 31. Do us a favour and check out his YouTube channel by searching Matt McKeever or using the link in our show notes.

Welcome again to Explore FI Canada. Money Mechanic with you as usual. And my co host Chrissy is here also, and a third special guest today is Shaidah. Say hi, Shaidah! First time on the show.

Shaidah
Hi!

Chrissy
Second time!

Money Mechanic
Yeah, that’s right. I forgot about that. This is the first time in a somewhat co-hosting role. So welcome, welcome.

Shaidah
Thank you so much. I’m so excited to be here.

Money Mechanic
Yeah. And you bring a wealth of real estate investing knowledge and that’s what’s going to help us today because we have a very special guest on the show that we’re excited to welcome. Matt McKeever reached out to us, and we are super happy to have him here with us today. Matt, welcome.

Matt
Thanks, guys, really appreciate you having me on exploring FI.

Money Mechanic
Yeah, well, we want to get into your journey. And we can hopefully all our listeners will learn something from you. And later on, we’ll let them know where they can find all your content, but maybe just start off with a little bit of your backstory, what your lean FIRE journey was, and what was your why of FI?

Matt
Absolutely. I’ve always had a bit of an entrepreneurial streak, but never really knew where to apply that. I think it seems to be a common thread with a lot of the people I bumped into in life where, you know, they want to do something a little bit more but they’re just really not sure what it was and that was definitely me so I kind of hopped from thing to thing. When I was a teenager you know, starting like a paintball field, a clothing store. Basic, little like businesses like that on the side while working, you know, at a restaurant. And in my last year university, a roommate and myself, you know, we were talking and we, we both knew we wanted to be rich, but we really didn’t understand finances that well. And finally, one day I had a bright idea. I was like, Jake, your dad’s rich, he owns like company and stuff. I was like, get him to give us some advice. And Jake’s dad actually told us to read Rich Dad, Poor Dad and The Wealthy Barber. And for me, that was really my gateway into everything, personal finance, early retirement, getting control of your finances, just all that great stuff. And then from there, last year university graduated, started working full time as a CPA or a CPA student, and just started exploring the internet, you know, stumbled across Million Dollar Journey and a few of those other Canadian blogs. And that really got me hooked. And then at some point in time one of these blogs actually posted an article talking about about Early Retirement Extreme, and Jacob Fisker. And immediately I was hooked on that idea as well. And really just jumped into the era rabbit hole and discovered everything about lean FIRE and realized that by building a small portfolio of real estate rental properties, it wouldn’t take me long to produce, you know, two to $3,000 a month and relatively passive cash flow here in London, Ontario, where I happen to be working at the time. For me, I then just became obsessed around the age of 25. Coincidentally, I was also around that time diagnosed with a health condition that, you know, they were kind of like, okay, like, at age 45 you might need a hip replacement, and your life might not be, you know, the standard timeline, and that really lit a fire under me as well. So, at age 25, I can remember I downloaded an app on my phone counting down to my 35th birthday, so we just count down the days. So I’d be like 2,563 days because at age 25, I made a promise myself that I would quit the rat race it 35. So 10 years from then, long story short, I ended up getting there a bit faster than I thought at age 31. I retired from the corporate world and I like to explain it that I jumped out of the plane without a parachute, but I trusted I had the right instructions. So again, I didn’t love the level of lean FIRE I was at when I jumped out of the plane. But I trusted that all the free time and just really being able to decompress would lead me to more opportunities.

Money Mechanic
Yeah, that’s pretty interesting. It sounds like you, you were creating that… I like to jump out of the plane analogy I was going to use the runway analogy that I’ve heard used quite a few times before is creating that runway so that you’ve got the ability to go and seek out those things that you truly love to do.

Chrissy
Yeah, I think it’s a very interesting path to FIRE and especially with your story about your medical diagnosis that I’m sorry to hear that but it’s great that you took the bull by the horns and turn your story around. A lot of people don’t do that. So I commend you for taking charge and changing your life. Now that you reached lean FIRE , and then you left the corporate world, what convinced you to take on real estate as your form of passive income or as the way to support yourself along with the lean FIRE income you’ve grown?

Matt
Yeah, I think real estate scratched a few different iches for me in regards to why I would choose it to build up my passive income or my lean FIRE number. When I was in university and first few years out of university, I did dabble with penny stocks. I think a lot of us at some point in time, stumble upon that idea that you’re like, I buy this for 30 cents and it goes to $30. I’m rich. And so I went through that face of kind of gambling with penny stocks and got burned on some Ring of Fire stocks. So some Junior miners and actually somehow managed to walk away like got burned on five of six, but the sixth one popped and was able to walk away with tail between my legs, but really not losing much money. But at that point in time, I realized that I wasn’t really in control. And so what I was doing was even with like my financial background, I could read the financial statements. And I believe that I understood how to interpret a cash flow statement or a, you know, management discussion and analysis. But I still felt like I wasn’t really being exposed to the full story and I wasn’t in control. And I originally like, I grew up on a farm, and my parents were very conservative, but the one thing they did trust in was that they weren’t making any more land. And growing up on a farm, that’s an adage you’ll hear again and again and again, because a lot of farmers end up regretting selling off their land at some point. So that paired with my natural desire to be an entrepreneur, to me real estate is really just especially rental real estate is just one of the safest business in a box approaches you can have it literally to meet like what everyone’s seeking with dropshipping or Amazon affiliates or anything like that real estate is just that really simple business, it’s really easy to understand it, everyone needs shelter in one degree or another. And for me, it just felt like the perfect fit as well, I just happened to be, you know, based out of London, Ontario, where the fundamentals for real estate worked really well, where it was quite easy to achieve, you know, two or $300 in cash flow per unit for a rental property, which meant, you know, to build that two or $3,000 a month in passive income to hit my leading up FIRE number, I really just needed you know, 10, maybe 15 properties max be able to achieve that. And for 10 to 15 units, I should say, which meant that I really just needed like three to five properties, right? You get like, three, four plexes and you can hit that number here in London, Ontario. And so for me, it was just a really clear path it felt like and I’m sure you know, the first personal finance book being Rich Dad, Poor Dad also had a major impact.

Chrissy
Yeah, he really focuses on real estate, which is quite different from the majority of people in the FIRE community, a lot of us we pursue investments in the stock market and we chase the 4% rule. As someone who is a fan of ERE and Mister Money Mustache who do discuss investing in the stock market. What was it that drew you away from that and more towards real estate?

Matt
Yeah, great question. So, again, that lack of control really was really a sticking point for me. So with a rental property, if things aren’t going right, I can roll up my sleeves and try and tweak it. If things aren’t going right, I can move into one unit. I can you know, house hack and have multiple friends move in with me live in that unit with a stock unless I’m gonna own 10% or more. Unless I have significant influence. I can’t really, you know, try and change the course of that battleship. Where for me, as a real estate investor, I felt a lot more nimble. I could pivot on a dime boom tomorrow that that vacant unit now as an Airbnb unit. Boom, it’s an executive rental. And also in my career, I worked in public accounting for just over five years and then transitioned into industry and worked for a publicly traded pharmaceutical company. And during that time, I was the sole financial controller. So I really helped put together the financial statements that were presented to our investors, as well as assisted the CFO and producing our management, discussion and analysis. And I realized throughout that entire experience that while numbers don’t lie, they can actually portray a story, if it called for an outsider to fully understand all the nuances going behind a business just by looking at these financial statements. In general, I maybe have a little bit of a counter perspective in regards to stocks in the stock market in general, I think, again, depends on your approach to stock investing, but originally, stocks really did just represent a fractional ownership in a company. At some point in time. It kind of feels like the most markets and society have moved away from that concept and it’s now more just a number on the screen that goes up or down. But a lot of the people I find talking about stocks these days, don’t talk about fundamentals the way I would want to talk about fundamentals, they may not understand you know, the bulk value or they may not understand what the cash flow analysis is actually showing. And very few people ever actually read the management discussion analysis, which to me is kind of the closest thing to a playbook that you know, the C level executives on the board are going to give you as an outsider.

Money Mechanic
Yeah, I think he makes some really good points that about the stocks and the general consensus for what we see in most of what you know, the the social media that we’re on for the Canadian FI community is everybody’s gone to the majority I don’t want to stay everybody but the majority are using index funds because it just makes it so simple, right? It’s set it and forget it, even if you’re using these, you know, all-in-one wrapped products. It just makes it so simple that you don’t need to get into all that because you just become a little owner of a little bit of everything right for diversity. So I find it an interesting to look at that because so many of us are starting the journey with you know, just with our TFSAs and our RRSPs for the tax advantaged growth of index funds. We’re starting off going hard into real estate is you’re dealing with potential taxable gains, whether it’s rental income or capital gains and things like that. I for me, personally, I’m looking at as real estate I’m very excited to get into it, but it’s a pivot now that I’m a little further down the initial journey. You started right off at the beginning. How did you get your first property what was what did you do to start?

Matt
So like a lot of young Canadian aspiring landlords, my way to get into the game was house hacking. If anyone in the audience isn’t familiar with house hacking, really the idea is just sharing resources and sharing the burden of costs. The average Canadian spends about 30 to 40% of their income on shelter. And for me coming from kind of the ERE school of thought, I realized that, wow, if I can knock over that domino of living for free, then I’m gonna be able to immediately save more than almost anyone else, it doesn’t even really matter about the latte factor if I can save 30 or 40% off the top. And in addition, if I can buy that property as a principal residence, you know, I get a lot of benefits in regards to the tax consequences that you mentioned, as well as just some other basic best practices in that regard. So I bought a poorly functioning student rental property moved into one of the bedrooms, you CMHC. So got an insured mortgage, which is pretty common for a lot of Canadians, they’re going to house hack, it’ll allow you to put less than 20% down on the property, and then had to my buddies move in, eventually found another roommate. And so at any given point in time, there’s probably four to six of us living in this house. And when there was like five or six of us in that house, we were I was able to literally live for free and make double mortgage payment. So I was able to get on a path where I could pay off my property in 10 years rather than the traditional 20. Now, with hindsight and becoming more and more serious as a real estate investor, I started to learn that debt really is a tool that can be my friend if I use it appropriately. But at the start, I was just focused on minimizing my debt obligation. I was like, I can pay for this house that I can live for free forever, and all in essence, be able to afford a lower cost of living than almost anyone else trying to approach lean FIRE that doesn’t have their shelter for free.

Shaidah
So for your first house hack, how much of your rent was covered by others? And how much of the expenses were you taking on?

Matt
Yeah, so it did ebb and flow based upon the number of roommates I had. And sometimes I would scale up the number of roommates depending upon whether I really had a fire under me to get to, you know, my lean FIRE number faster. And sometimes I would scale it back if I just wanted more space or more room in my own house, but when I’d have four to five roommates at the peak, I was literally bringing in $1,600 to $2,000 a month. Whereas my total cost to operate the property, including double mortgage payments, were around $1,600 a month and that included like Internet. So I was literally able to get to a point where I’m essentially living for free or my my tenants and roommates are paying for my entire property.

Shaidah
Do you think having a CPA background and a financial background helped you with this? Or do you think anyone can do this?

Matt
I definitely believe anyone can do this. It’s really just a matter of getting clarity on what you want. And then for me, I’m a huge believer in SMART goals. So the more specific, measurable, achievable, realistic, and timely you can make your goals the more I believe that you’re actually going to achieve them as well as if you’re willing to say your goals out loud. So I think I got lucky in a couple different ways. Where one at age 25. I started wearing my goals by having that countdown clock on my phone. As well, I found with time and experience that if someone is able to find an emotion and tether that emotion to their goals, it’s a lot easier to achieve that goal. So for example, the emotion that I tethered to my goal of lean FIRE was really this, I may not have quite as many years as the average person. If that’s the case, I want to make sure I make the most of them. I don’t want to retire at even 55 or 60. And then find out that, well, I’ve got a broken body. And that’s that. And for me, because I was wearing my goals, and I had the emotion kind of backing me up on my goals. It was just, I don’t know, it became inevitable To me, it was just like, well, I’m definitely not gonna have a job at 35 that’s just the way it is, no matter what happens. I’m gonna set myself up to take the right actions and steps to get there. So I think being a CPA didn’t hurt me. I think that it definitely taught me a degree of financial literacy that the average Canadian may not be fortunate enough to receive but I don’t believe that it was, you know the secret sauce to my success by any stretch of the imagination. One thing I didn’t notice as a CPA, my five years of public practice was just a lot of my high net worth clients. They either built their wealth in real estate or at some point in time, they took the wealth they built by being an entrepreneur and started reallocating some of those assets into real estate. So it seemed like a very consistent pattern that a lot of people in the one to $10 million in net worth range had got there via real estate, or once they got there, they then moved into real estate. So again, I love pattern recognition and just trying to follow you know, people’s action.

Chrissy
So, would you say that real estate can help speed up the path to FIRE?

Matt
I think absolutely. House hacking is the number one way and again, you don’t I use house hacking as a very broad term so you can even rental hack and still achieve similar level of success. But if you can find a way to live for free, I think that no matter what other decisions you make, you’ve set yourself up where you’re literally always going to be above average, compared to the average Canadian in regards to personal finances. If you decide to go further down that path and start accumulating multiple rental properties, I think the passive income you can generate is a great way to get to your lean FIRE number a bit faster, because often you can do it with less total assets than you would say, by you know, targeting the 4% rule or maybe going after blue chip dividend payers and trying to live off of the dividends or the distributions from REITs and other companies like that. And then for me, the final thing is, depending upon when I get to that lean FIRE number, again, because I’m in real estate, I can decide to double down and really focus on growing that as a business, or I can really extract myself from it put in a property manager and become even more hands off and have it become truly passive versus I think being a landlord and active landlord is really semi passive in my opinion. In general, on my YouTube channel, I try and just tell people, it’s passive because I feel like trick them into it a little bit. And then once they get into it, you know, you end up becoming a different person, right. And I think that’s the case for a lot of us that we originally started out with a lean FIRE number or goal related to our personal finances. But in order to become the person that achieves that goal, we often become a different person. And I think that that’s a great thing. And we often become people that are much more empowered, we start to view everything through the lens of, you know, I’m in control, how can I fix this? What can I do to have influence or agency over this situation, rather than just becoming a victim to life where life happens to you, we really get to start happening to life.

Money Mechanic
That’s a great point because that’s what the whole journey to financial independence is about. It’s not a one day you start and one day you end it’s the whole in between the transition of you, your your community who you hang out with the five people you hang out with the most all these things. are all part of that journey, not just a beginning and an end?

Matt
Yeah, absolutely.

Money Mechanic
So I have a question as since we’re recording this here in early June, I’m just thinking about the last few months. As far from a risk perspective of having a bunch of doors that are rentals. How did you handle what’s gone on? You can keep it kind of high level here. I’m just thinking because a lot of our listeners are very interested in real estate, but they’re not quite there yet. And and there may be wondering about from using other people’s money and having a lot of leverage, and then having a bit of risk from tenant issues and non payments and things like that. Has the as the environment changed for us and how do you view it now?

Matt
Yeah, that’s a great question. And it really does deserve a nuanced answer. So I’ll give a little bit of context before answering. I’m based out of London, Ontario in the province of Ontario. In Ontario, we have some of the most tenant-friendly legislation. So we’ve got the landlord tenant board and the residential tenancy act. And unfortunately during COVID, the province literally just shut down landlord tenant board, which was our only dispute resolution mechanism here in Ontario. The regulation and legislation we have is probably one of the greatest risks to this investment strategy. That being said, again, I do know of landlords that really struggled during COVID to collect their rents and I know of other landlords that had really made no difference whatsoever. For me as a business owner, you know, we maybe saw a two to 3%, decrease and total collections, but nothing significant to the point where you know, what a lot of newspaper headlines were making it seem like, and again, for myself, a big part of that is being in control. So I can take ownership of the situation and lean into it, I can have my property managers reach out proactively and say, Hey, here’s the new government programs that have been rolled out. If you think that you’re going to be struggling in order to pay your rent, you know, we’ll try and help you figure out whether you can get into it. Right and I had one of my property managers literally just learned the CERB process, which turned out to be ridiculously easy, and be able to show my tenants if they, if appropriate, how to go through that process. And again, we can pivot and work with people. So we can do delayed payments, we can really work with them one on one, where with a paper asset, I feel much more a victim of the market. We’re wherever the market sentiment happens to be in that moment. Now, again, real estate for me is a long term play. So real estate’s not a get rich, quick scheme by any stretch of the imagination. I think it’s a get rich eventually scheme, as in like, if you stick with it, it’s time in the market, not timing the market. And while I would have loved to see the economy just keep humming the way it was previously. I really invest on fundamentals. So I look at affordability here in London, Ontario, we’ve got the same minimum wage as anywhere else in the province. And so that’s like $14, $15 an hour. Real quick, the average full-time worker’s considered to work 2,000 hours a year. That means the average minimum wage earner can make about $30,000 a year. According to Stats Canada they spend about 30-40% of their income on shelter. That means they can afford about $10 to $12,000 a year on rent. While the average one bedroom apartment I rent here in London is around $1,000 a month, and a two bedroom apartments around $12 to $1400 a month. So again, from an affordability perspective, I’ve targeted rental units, kind of near the lower end of the affordability range, just because that’s what gives me comfort because my natural inclination is to be very risk adverse. It’s just my CPA nature, I guess. So definitely, there’s been hiccups and bumps along the way throughout my journey, even pre COVID. Certainly COVID has been an interesting environment. But for me, it’s hopefully you know, one of the biggest Black Swan events that I may ever experienced in my life and to be able to be in control that situation Feel like I was steering the ship rather than just caught in a hurricane and loss has really been a gratifying experience. I guess,

Shaidah
Matt, I really like how you talk about real estate being an asset that you have full control over. And I totally agree with that, because that’s why I’m in real estate as well. I wanted to know if all of your properties are being managed by property management, or are you managing any of them yourself?

Matt
So certainly, when I started, I self managed a lot my properties and it’s a way to kind of juice your returns. Because if you’re not paying, you know, $50 or $100 a month per unit that can really help your cash flow, even amongst 10 units, all of a sudden, you’ve now got another thousand dollars a month in cash flow. However, I think a lot of real estate investors and landlords unfortunately never factor in that property management costs. And then when they hit lean FIRE, they realize they’re not truly retired. What they’ve done is built themselves a low paying minimum wage job of being a property manager. So at this stage in my life, I do outsource all the property management. For me, it was one part just trying to free up my time to focus on the highest best use of my skillset and kind of self development. And on the other side, it was also about, you know, life lifestyle design. So my sister actually stepped in to work for me full time about two, three years ago, to become a full time property manager and just learn the business one because I thought it would be a great way for her to learn more about personal finances, too. She was a young mother and I wanted her to be able to spend more time with her two kids and just have more of the lifestyle, like the work life balance that I that I feel like more people should have. For me at this point in time. I’m very abstract and hands off with my real estate, I really just focus on the parts of the business I’d like. And for me, that’s negotiation, deal acquisition, that’s the really exciting, enticing parts of the business. So I really focus on that and then outsource all my weaknesses.

Shaidah
Are all your properties apartments or do you have any single family or apartment buildings?

Matt
Yeah, so I have a mix of real estate, I’ve got a handful of student rentals, those are probably the most impacted right now. That’s COVID-19 virtual classes and student rentals are a really dynamic situation. And that’s how I originally got started in real estate. Then I moved into small multifamily properties. So you know, single family homes, like single family century homes that had been subdivided into multiple units. And then in the last couple years, I’ve been moving into actual purpose-built 12 units and above apartment buildings. So right now I’ve got a giant mix of properties and maybe haven’t done a count recently, but 120, 130 units. This year I I’m actually focusing on simplifying my life though. So I’m going to sell off anything that’s under a 10 unit apartment building, and just really focus on the purpose built stuff now because for myself, it just seemed like an easier, more scalable business, where being in the trenches and buying those small multi families was great. And I absolutely was able to increase my net worth and my personal wealth from doing so. But it, it feels more art than science. We’re buying the apartment buildings feels more science than art. And so because science feels more scalable to me then like an art.

Money Mechanic
Yeah, you talked about the beginning of the beginning from the house hack. And then you move from there, obviously, and you’ve done an impressive job to scale up. How much of that transition was using joint venture to to move along and scale the business up to these larger buildings?

Matt
Yeah, great question. And every real estate investor has their own story and their own approach. So mine’s not necessarily indicative of everyone else’s. For me, I really love Joint Venture Partners. It’s maybe just a character flaw and myself that I recognized at a young age but I for whatever reason, I’m really comfortable letting Matt McKeever down but I hate letting down other people So having a joint venture partner was just a great reason to care.

Money Mechanic
Motivating factor.

Matt
Exactly. And as I grew my portfolio, you know, there gets to a point where it’s not impossible to get jaded, and you’re like, well, is this duplex really moving the needle for me personally, but if I viewed it through the lens of say a new JV partner that had never bought a property before only had one duplex, this next duplex was really important, really exciting. And I could kind of vicariously live through that thrill just by being partnered with them. So a lot of my real estate has been built up through Joint Venture Partners and regardless of the whether I’ve done with JV partners or not, it’s all built upon OPM other people’s money, which is a really common term that if you continue to go down the Rich Dad, Poor Dad, series of books you’ll be introduced to, but at this point in time, I actually have a rule that shocks a lot of people. I don’t use Matt McKeever’s money for real estate anymore. And that’s simply because of there’s always another good deal. And when I originally quit my day job, I kept stretching myself and like, you know, painting myself into these corners where like, I’d always pull it off. But like it would be really stressful. And it’d be very exciting in real estate shouldn’t be exciting. It’s not supposed to be get rich quick, it’s supposed to be get rich eventually. And so eventually, I just had to implement a rule for myself and say, I no longer use Matt McKeever’s money for real estate, I’ll only invest in active businesses now. So, you know, I dabble with some angel investing, and I’ve got a few active businesses. But clearly real estate now is all through JV partners and through OPM. So there’s a recent entity that we started up less than a year ago, and it it burns apartment buildings. So just taking that basic principle, but doing it on a large scale. And I may be wrong, but I don’t think I’ve ever even put $1 into that corporation. And at this point in time, we maybe have 40 or 50 units in that corporation by itself.

Chrissy
Can you just explain quickly what BRRRR is because not our entire audience is familiar with that term?

Matt
Absolutely. So I believe BRRRR was originally coined and popularized by Bigger Pockets. So that’s definitely where I discovered it. And BRRRR stands for buy, renovate, rent, refinance, and repeat. And the reason that’s such a powerful strategy and why for a non real estate investor may not sound that important, but most newbies to real estate start off only using their own money. And when you start off only using your own money, you’ll quickly learn that it takes a while to save down the downpayment, especially if you have to put 20% down. And even in London, Ontario when I was buying at the start, properties were very affordable but I still needed like 40 to 80 grand per property. And on you know, an average wage, that’s at least going to take a year or two to save up that money, where the investment strategy is away and under a year and often done in six months or less. Where a real estate investor can go into underperforming underutilized rental property, fix it up and bring it up to its highest best use through strategic renovations and rented out for the top of fair market value. So really just getting that lift and rent prices. And as you lift the rent prices, that increases the overall return on the investment. And because you’ve now increased the income, an investor or an appraiser will value the property as being worth more. So you’ve now lifted the equity as well. You refinance the property from that new equity and what we call perfect BRRRR, you literally get all your money back. And that’s really what I started documenting on my YouTube channel was just how I was implementing this BRRRR investment strategy. Because to me, once once I discovered that when I was still using my own money, it was all sudden, like Pandora’s box it opened, all of a sudden I was like, Okay, I understand now how to attract Joint Venture Partners. I’m just going to get them addicted to free properties. And so I would literally just go to them and say Hey, will you lend me like $100,000 we’ll go buy property together and under a year, I’ll get you your hundred thousand dollars back, give it to you will now each own 50% of this property will have 20% equity. And it’s still because we’ll refinance and that’s what the refinance rules are. and The only caveat is that if I get you all your money back, you have to promise to give it back to me so I can go buy you another property so I can get you another property for free. Does that sound like a good idea? And so all sudden, that really fast tracked my growth and that’s when I really started the hockey stick curve.


Save up to 50% on life insurance.

Chrissy
If you’re like most of us, getting life insurance is something you know you should do, but you never seem to get around to it.

Money Mechanic
You’re right, Chrissy. Now there’s a better way to buy life insurance. It’s called PolicyMe and I think our listeners will love it. More than 37,000 Canadians have already used PolicyMe for their life insurance quotes.

Chrissy
Yeah, I’ve actually tried it myself. And in less than 10 minutes, I received a selection of quotes from reputable, established insurers. It’s fast, free, easy to use, and no pressure.

Money Mechanic
Sounds great. I heard PolicyMe uses intelligent technology and personalized advice that recommends what you need, but not a penny more. You could save hundreds of dollars per year on your policy as top insurers compete for your business.

Chrissy
Protect your family. Get your personalized quote today at explorereficanada.ca/PolicyMe.


Shaidah
So for the BRRRR strategy, are there a lot of properties that work in London area to apply this strategy or are you in other areas as well for purchasing properties?

Matt
Yes, so right now all my real estate is in London, Ontario. And for the most part, all of southwestern Ontario is a great opportunity for implementing the BRRRR investment strategy. The BRRRR strategy doesn’t work as well in like downtown Toronto, downtown Vancouver, downtown Montreal, those markets will be much more difficult to implement a similar business model is what I’ve done. However, Brandon Turner said this on Bigger Pockets. And I’m a firm believer in it as well that within a three to four hour drive of pretty much anywhere on the continent of North America, there is a market that will fit the 1% rule. So it’s really just a matter of if that business model fits your long term goals, then focusing on finding markets where that strategy works well,

Shaidah
All your properties meet the 1% rule?

Matt
Yeah, so the vast majority will meet or exceed the 1% rule after I, you know, do my strategic renovations. And just in case anyone’s not familiar, the 1% rule simply is you want gross rents to represent 1% of the total cost of the asset. And that’s really a business model between BRRRRing real estate and focusing on the 1% rule. That’s really been, I get some haters by YouTube and social media all the time, because you talk about these rules of thumb and I’m like, man, I build my empire off of rules of thumb. That’s how you have a scalable business model that you can really take and build upon. So for me, it’s I try really keep it simple and follow that KISS principle and the 1% rule. Now, that being said, the 1% rule works well in my market, even if we’re paying utilities as the landlord. So in theory, I’ll compromise to as high as 0.8% if the tenants are paying for all their utilities, but ideally, we’re gonna aim for 1%

Chrissy
So is that pretty easy for you to meet in London? Because nowhere even within an hour of Vancouver, can you find the 1% rule!

Shaidah
Nowhere within four hours of Vancouver.

Chrissy
Yeah, yes. You’re right.

Matt
Um, so yeah, so certainly it can be done here consistently in London. In 2015, 2016, when I really started scaling my portfolio, the prices were more accommodating and favorable to that sort of business metric and rents were just on the increase because, you know, we’d seen a big bump and minimum wage and things of that nature, but you can still achieve it. It just takes a little bit more effort and For me, like, there’s actually been kind of just a weird phenomenon kind of occur where I started documenting about how I do 1% real BRRRR properties in London, Ontario on my YouTube channel. And then all of a sudden just like a lot of people from the GTA came to London so it has got more competitive than it has in the past. And so for myself and a lot more of the sophisticated investors, we’re primarily going to focus on private off-market deals. So buying from seller direct rather than necessarily buying off the MLS. So if you know an audience member goes on the MLS today, it will be difficult to find just a turnkey 1% real property in London, Ontario, but you can still go to smaller markets like Sarnia, Chatham or Windsor and you can definitely achieve that sort of business metric by buying straight off the MLS.

Chrissy
Okay, now, just to give us a point of reference, out here on the west coast, how far are these places from the downtown Toronto area? How long of a drive would you say they are?

Matt
Yeah, so London, Ontario. about two hours with no traffic, maybe two and a half, three hours if you don’t time it right. And Windsor, Ontario would be like four hours, again, might be a little bit more with traffic or if you’re going in the, you know, the dead of winter when you could have snow squalls and things of that nature but, and good weather during COVID-19 you can definitely get to all these markets and under four hours on the highway.

Money Mechanic
So Matt, you’re 35 now I believe from other podcasts I listen to you on. Yeah, so you’ve pivoting back towards your FI journey here you kind of seems like it sounds like you hit your sort of 10 year goal, surpassed it? And what does your journey look like now moving towards the future. You’ve you’ve got financial independence behind you. You’re obviously not retired early because you love what you’re doing in real estate and with your other projects in business. Tell us about some of those other projects and what it looks like for your next 10 years.

Matt
Yeah, appreciate that. So for me once I hit lean FIRE , I really I didn’t find the personal gratification and lean FIRE that I was originally hoping to. I think like a lot of people, I was running away from something as much as I was running towards something with lean FIRE. And with that, I’ve talked about this at length on my YouTube channel, but I kind of decompressed for six months. So I was really working hard in the corporate rat race, climbing the ladder, and trying to really just earn as much money and bonuses and stock options and things of that as possible. And when I originally left like, I, I don’t know whether I assume this is fine. I literally just drank too much, smoked too much weed, and played too many video games for those first six months. And with hindsight, I look back on that I really had to ask myself an honest question. Am I proud of what I’ve done? I was like, Well, I’m really proud. Is this all there is? Yeah, I was like, I’m really proud of hitting lean FIRE . But I was like, man, like none of my friends are there. You know, I try and write these really long. emails to them explaining how for five years they would invest in London, Ontario with real estate investing and follow these business models, that they’d be able to achieve something similar or better than myself. And those emails would often like border on 5,000 words or longer. So I’m sure you guys can imagine not a single person ever responded,

Chrissy
That’s a really long email!

Matt
It is. It’s a novella. And, you know, I just was I want something more. And I really started thinking about lean FIRE through a different lens. And these days, I’d like to think of it as much as FIREpreneurship. And so kind of combining lean FIRE and entrepreneurship. So the idea is, the reason I think a lot of entrepreneurs fail, is they don’t have their base, lifestyle covered. So they can truly go all in to their business and their passions. Whereas if you were lean FIRE , you could truly go all into whatever that is.

Money Mechanic
Yeah, that’s a good point.

Matt
And for myself, I really found a lot of personal satisfaction and building and growing communities. So here in London, what that looked like we started London on FIRE, which was a financial independence retire early meetup group. And it started off with just like, literally 15 of us showed up the first time and the basement of this bar, and it kept growing and growing. And to the point where, right before COVID, we’d regularly have 100-plus people attend here in London, Ontario, and we’d have people drive from like Buffalo, or Detroit. So they’re crossing international borders, to just come and be a part of this community. And I found that just intoxicating, being able to connect people because I’m a huge believer, you are the average of the five people you spend the most time with. And I wanted to try and give people more and more permission to step outside of their comfort zone and find the group of people that they really resonate with because it’s unfortunate a lot of us are friends or just the default of people we happen to grow up around with as well as people that went to the same school as us. And then finally, people that work for the same employer as us, we don’t actually have much in common other than a few accidental traits. And yet, that’s what we build our relationships and friendships off of. And for me once I really started seeking like-minded individuals, people that you know, march to their own drum, I just all of a sudden, I became so much freer and just wanted to keep growing those sort of communities. So since then, you know, I started a YouTube incubator here in London, where I took one of my sixplexes and offered free rent for a year, if you would make a YouTube video a week about the City of London, and we got in like CBC Radio and London Free Press and things of that nature. And now I’ve created kind of like a entrepreneur incubator where I live, we rent out like a big McMansion. I live in the master suite, and then a bunch of my employees and business partners live in the other bedrooms. So we’re still doing that house hacking lifestyle. And to me, I really like challenging social norms and really, just questioning whether what we have is the best way to get what we want. I think again, a lot of people, I found with time and building this community is the more and more people that are really thirsty to find like-minded individuals, they really want to surround themselves with people that believe that they’re capable of doing more and having a greater impact. So that’s really what the last five years have been, for me is just like discovering this passion for building communities, building businesses and just, you know, living, living in my truth regardless of whether that’s society’s truth. And that’s what the next 10 years look like, for me absolutely is continuing just to, I want to try and give permission to as many people as possible to focus on their passions because the society and the school system has just trained a lot of us to just obey orders and just wait for someone like everyone is acting as if they’re in a movie and someone’s going to spot them and tell them they’re special and give them permission to go take charge of their lives. And it’s so rarely happens that way. And so I want my YouTube channel, my communities to at least be that spark.

Chrissy
So I assume you’ve moved past the 5,000 word emails and you, you’ve really taken that spark as you talked about it. And you’ve grown it into a presence on YouTube and you had a podcast for a while. Have you convinced any of your former friends or your friends with the emails that you used to send? Have you now convinced them to join you on this journey?

Matt
So a few of them are haphazardly following along and getting into real estate. certainly never. None have found like the same passion for it that I did. But again, I was able to find other people that really did have a passion for more and just surround myself with those individuals.

Money Mechanic
I think that’s one of the common threads that most of us can relate to when we started each of our FI journeys. And like I mentioned before, it is a journey. It’s not a beginning and an end. And once you start it, you know, you meet new people, you meet people on You meet people in person in these meetups, and people like you math that are hosting meetups and things like that. I know you’re doing some big meetups before all the COVID thing. And I’m sure you’ll get back into that when things are somewhat back to normal. And yeah, these communities are so welcoming. And really everybody is from all walks of life and all financial backgrounds are welcome, because it’s just all about the sharing and trying to grow it together.

Shaidah
Yeah, I absolutely agree with that. I’ve actually hosted two meetups myself. And I think it’s been such a great way to meet new people to talk about where they’re at people from all walks of life want to share their journey and any tips that they may have to either they’re already fit or they’re almost there. They’re starting out. Everybody wants to help everyone along, for sure, for sure.

Money Mechanic
Well, Matt, it’s been an absolute pleasure having you on the show. And I think we could have really gone down into a deep dive in real estate. You mentioned YouTube channel quite a few times, just go into a little more detail for our listeners so they can find you and learn more about the BRRRR strategy about how one of the things we didn’t even get a chance to talk about which I won’t start now. But just all about financing because there’s a lot to learn about that too. So give us give us your your two minute elevator exit pitch for all our listeners that are hungry for some of this real estate knowledge, Matt.

Matt
Awesome. Love it. So my elevator pitch is this the reason I started my YouTube channel was because of those 5,000 word emails and not having a single person respond to them. So for me, the answer was I was reading a book at the time it said talk to your audience in the language they wish to be spoken. And I was like, oh, real estate is visual. It’s tactile. The reason I like it is because I can drive by it, I can go see it. I can show a picture of it to someone else. lot higher. Do that with a stock certificate.

Money Mechanic
Yeah.

Matt
And so I realized that I need to start really showing my story rather than just trying to tell my story. And that’s when I started my YouTube channel back in 2016. And a big part of that was with real estate investing. I found the information either it came from Canadian authors, but they were like 10, 20, 30 year old books, or it came from Americans. And while a lot of The strategies Americans talk about and principles work. In theory, a lot of the tactics do not work the same way. So I really just want to document how on my YouTube channel, how I succeed with real estate investing, and then continue to branch out and start bringing on other guests. Because I get it single white male, it’s really easy for people to look at me and think that I got dot or dealt a winning hand from day one. But there’s all kinds of people that come on my YouTube channel immigrants that have been in Canada for less than 10 years that came with no money. We’ve got, you know, parents with four plus children, households and things of that nature, and people of all walks of life and ages. So really, my long term goal is just to have a giant spectrum of individuals so that regardless of whether you resonate with me, you can find someone you resonate with on my YouTube channel. And in 2020, we really made a commitment to producing one video a day on YouTube. So some people don’t realize this now, but I’ve got a full time social media team. So I’ve got four full time employees that work for me in London, Ontario, not outsourced, not VAs. These are real people that, again, are really helping me build this community online. And I just want to try and pay it forward, because throughout my life, I stumbled into a couple of accidental mentorships. And, again, it’s very rare someone will give us permission. So for those of you that are willing to just blaze your own trail, I hope that you can get some great information from my channel, and if not, at least some inspiration just to move forward.

Chrissy
That’s awesome. I love how much time and commitment you put into building community and giving back and helping others. This is how we can help spread the message of FIRE. And I love that your version of FIRE is a little different from ours in that it’s quite real estate focused and that’s something that our listeners are quite eager to learn more about. So thank you for sharing your story and your knowledge here.

Matt
Thank you guys really appreciate it and love what you’re doing with this podcast.

Money Mechanic
Thanks. That means a lot. So for all listeners, that’s Matt McKeever. And I know you can find you’re quite active on Instagram as well. And I think you just look up Matt McKeever on YouTube and it’ll be in the show notes for sure.

Matt
Yeah. Anywhere there’s social media. I’ll be there.

Transcribed by Otter.ai

Show outro

Thanks for listening. If you’ve been getting value from our content, please support us in the following ways:

  1. Leave us a review and subscribe in your favourite podcast player.
  2. Tell your friends and family about us.
  3. Use our referral links at exploreficanada.ca/recommendations.

All of our show notes can be found at exploreficanada.ca. You can also find us at our own blogs figarage.ca, or eatsleepbreathefi.com.

Our music today was provided by Purple Planet.


Episode links

Episode advertisers

Matt McKeever
PolicyMe (For more about PolicyMe, read Chrissy’s review at Eat Sleep Breathe FI)

Transcript provider


Help us grow by:

  1. Leaving a review and subscribing in your favourite podcast directory.
  2. Sharing our show with family and friends.
  3. Using our referral links on the Our Recommendations page.

Thanks for your support!

4 Replies to “034: The Real Estate Empire Path to FIRE | Matt McKeever”

  1. I am happy that Matt is living his dream of being rich and an entrepreneur. Calling one FI or FIRE when you are running multiple businesses seems a stretch to me. (Daily YouTube content and 100+ rentals) This podcast felt a bit too much like a promotional segment for Matt to get more YouTube followers. I didn’t enjoy this episode as much as most of you others.

    1. Hi Scott—I’m sorry to hear you didn’t enjoy this episode as much and that it felt like a promotional segment. That wasn’t at all our intention! I genuinely felt that Matt had an inspiring story with actionable knowledge to share. As for his sponsorship of the show, I’d like to explain that.

      Until recently, we’ve been recording our show with the free version of Zoom. That meant we could only be on a call with our guests for 40 minutes at a time. Each episode takes a little over an hour to record, so that meant we’d have to ask our guest to log off mid-interview, then log back in. Very low-budget, very awkward, and totally unprofessional! But we’re running on no budget, so that’s what we had to do.

      Anyway, when Matt realized this at the end of our recording, he generously offered to cover the cost of upgrading our recording software—in exchange for a shoutout. For us, this would mean better audio and a more reliable and professional interface to record our shows with. (We otherwise wouldn’t have had the funds to pay for the upgrade, which would’ve meant sticking with free 40-minute increments on Zoom.)

      However, as generous as the offer was, we didn’t make this decision lightly. EFIC is our baby, and our listeners mean everything to us, so we are very careful about the sponsorships we accept.

      After interviewing Matt and getting to know him, I feel he has his heart in the right place. He wants to help other people reach FI through real estate. It just happens to be through his YouTube channel. But his content is free, and I don’t believe he has anything to sell. I also think he has a lot of value to share (I wouldn’t bring on a sponsor who didn’t).

      So now you see the very long thought process Money Mechanic and I went through in accepting Matt’s offer to sponsor our show! In the end, it benefits our listeners by providing improved audio. And it benefits us and our guests because we now have a slicker, more reliable recording interface (amongst other technical benefits behind the scenes).

      I’m sure you weren’t expecting an essay in reply to your comment, but I hope this clears some things up. Thank you for taking time out of your day to share your thoughts with us. Your comment has been noted, and we will be more sensitive in the future to how our listeners might react to new sponsorships.

      1. If you have a google account you have access to Google Meet. It’s free and has no time limit like zoom.

      2. HI TW—thanks for the suggestion. I looked into Google Meet, but I don’t think it can record separate tracks for each attendee. Also, I don’t think the audio is of the quality that we need. Perhaps they’ll improve in the future!

Leave a Reply