Olympics to Real Estate: How to Start Over and Ditch Excuses | Sunitha Rao

Sunitha Rao (12s):

Well, I think like in anything in life and investing is the same way. If, you are doing what everyone else is doing. You're probably doing it wrong. You know, like you need to be thinking differently. That's where the value is added. Whether you're at a job, like if you're putting the same spreadsheet together, plugging the same numbers, like you're not gonna get the promotion, you have to think differently and see what else is going on around the periphery and go that way.

Etinosa Agbonlahor (39s):

Sunitha Rao is a former professional athlete and Olympian as in played at the Olympics business person and real estate investor. Sunni Thorn Pro in tennis at 14 and represented India in international tournaments. She ranked in the top 200 Indian tire world and also played at the Beijing Olympics before retiring from tennis in 2009. At the age of 23, after almost a decade of playing Sun retired from tennis with a sixth grade education and just a sense of wanted something different. She then went back to school to a community college first and then transferred to Babson College, putting herself through school, working multiple jobs while studying to get her bachelor's degree and then an MBA from Villanova University.

Etinosa Agbonlahor (1m 24s):

After landing her first corporate position, she realized she couldn't rely solely on her salary to achieve the financial freedom she wanted. She then started exploring real estate investing. UniSA continued to work in the corporate financial planning world across the defense industry, biopharma the mortgage industry for years while growing her real estate business. She acquired her first property in 2018 and has since created the Griffs Property Group, building a portfolio of short-term rentals as well as long-term rentals and buy and hold properties. Sun is the chief San Jose officer, which is sort of a COO of the Afford Anything Show with Paula Pant and also co-hosted the Invest Anywhere series with Paula.

Etinosa Agbonlahor (2m 4s):

She's also the coordinator of the Your First Rental Property course, which is how I know her Sun is a professional speaker, passionate about financial empowerment and has appeared on platforms like FinCon Economy, BiggerPockets and many, many more. What I admire about Sunitha is her mindset to tackling hard things. Tom Bilyeau always says Toughen up buttercup, which means face the hard things, go get what you want. And I feel like Sunitha embodies that energy a thousand percent. So I'm really excited for this conversation. Welcome to the show Sunitha.

Sunitha Rao (2m 35s):

Thanks for having me and thanks for your kind words that gives me the warm fuzzy.

Etinosa Agbonlahor (2m 40s):

So you have an incredible background. I remember on our first phone call you mentioned you had lived in Australia because I also lived in Australia for a few years and I was like, oh, that's interesting. So I went on. Like I think I Googled you afterwards and I was like,

Sunitha Rao (2m 54s):

Oh, shocked me.

Etinosa Agbonlahor (2m 56s):

I was like, she was like doing real things and she was like in the Wi Tennis Association, she went to the Olympics. What So I did. Still again, I was very impressed.

Sunitha Rao (3m 5s):

Oh, thank you. Well I find you very impressive with your background at all the financial institutions and your education, so that means a lot to me.

Etinosa Agbonlahor (3m 13s):

Well I think today what I really want to cover is definitely like, you know, that background, your real estate investing, but I feel like you also have this mindset of like resiliency that I really want to kind of explore with you. 'cause I think that's what's going to be really valuable to the audience at the top of your website is a quote and you say Financial freedom is freedom. Walk me through what that means for you. Like what inspired that quote?

Sunitha Rao (3m 38s):

Yeah, So I believe our money journeys are influenced from our experiences when we are very young and my real estate journey was really heavily influenced by my relationship with money. And my view of money was demented when I was super young because I grew up in a home that was ruled by domestic violence. And the thing with domestic violence is there are all kinds of mechanisms that a perpetrator will use to keep their victim in the place that they want 'em, which is in the home where they can continue to have power and control over them. And people talk a lot about aspects of it, like social isolation, like you can't talk to your friends or the survivor, their vic, the perpetrators victim cannot talk to their friends, their family, et cetera, to ask for help.

Sunitha Rao (4m 30s):

You know, they talk about all these different types of control, but one of the things that isn't discussed as frequently is financial control, which is also considered economic abuse. And that's where the perpetrator really controls their victims supply of income of money. Whether it's controlling bank accounts, whether it's taking the money from them directly or showing up at their job, making their victim unable to hold down employment. And so when I toggle back and forth between victim and survivor, I believe the correct term is survivor. But to, when you talk about it relation to the perpetrator, like it, the victim makes a little bit more sense, but however you wanna call them, it's very difficult for this survivor to leave when they don't have any thoughts, especially if there are children involved, et cetera.

Sunitha Rao (5m 22s):

And so the household that I grew up in, my father was the perpetrator. And one of the big things that I grew up hearing, one of the very common phrases was, what's your mom gonna do? She can't do anything. And that meant she had no options because she couldn't afford to leave, she couldn't afford food, she couldn't afford to put a roof over her head, let alone the the heads of my brother and I. Right? And so then what are your options if she's already socially isolated, she doesn't have money, like maybe a shelter. A shelter, maybe foster care for us. And in many ways in those situations, the devil you know is better.

Sunitha Rao (6m 4s):

So that was the phrase that I heard a lot growing up and I learned to equate lack of money to lack of options. And so the flip side of that is that I equated having money, having your finances in order to freedom.

Etinosa Agbonlahor (6m 21s):

Hmm.

Sunitha Rao (6m 22s):

And so fast forwarding a whole bunch of years after I graduated undergrad, I got a job in the defense industry. I was in like the leadership management program and I thought I was doing a really good job. I was doing things that others in my cohort weren't doing. Things like making recommendations to leadership and getting, getting my, my recommendation that the new hire adopted on a company-wide level and this is like a large multinational company. And then I found out one that I wasn't being paid as much as others in my cohort. I was being paid the lowest. And then in lunch conversation with my rotation manager, his feedback to me was, we know you're good at things but we don't know what they are.

Sunitha Rao (7m 7s):

And I was like, I've had several performance reviews that have gone well. Like I I, I don't understand, you know, but in that moment, like it was like a lot of things kind of just hit me at once. You know, If, you mentioned like I had a career before that you know, I was a successful athlete. I'd given up a lot to reach that level of success and I had to start all over again with a sixth grade education. But myself, through college I sacrificed so much and then and singing across from this person who, I mean this is, he was good at what he did, but this is what he did. You know, he's like, does that make sense? And I was like, how, how is this even happening? Also in the back of my mind I was like, how dare you?

Sunitha Rao (7m 47s):

Yeah, that's not relevant

Etinosa Agbonlahor (7m 50s):

What I've done. Like how dare you?

Sunitha Rao (7m 52s):

Yeah. Like I'm capable, I'm confident, I've done great things at different stages and I've done great things for this company. But the biggest thing that I felt was a feeling of being trapped. I realized that even though my, my situation was different from my mother's, I had put all of my eggs into one basket and that was the basket of the company that I worked for. And I felt those limitations. And I decided at that point that that was not in my best interest to rely on a company to recognize my worth, reward me accordingly. And those rewards would define much of my life. Like time and money are two of our biggest constraints and they companies, our jobs run those So I decided I really, I needed to not be that person who put all of our eggs in one basket and I needed to continue to do well, but I also needed to take care of myself in a different way.

Sunitha Rao (8m 44s):

So that was how after a lot of researching and podcasts, I eventually stumbled onto real estate investing. Thankfully.

Etinosa Agbonlahor (8m 52s):

Thank you for sharing that about background. But also I think a lot of people are starting to draw that same parallel that you drew around. It's not, it's absolutely not the same as being in, you know, an abusive situation, but there is a sense of somebody else has a lot of control over my ability to do the things I want to do. And it doesn't always feel it's, it's comfortable, right? There's a paycheck, there's always gonna be a paycheck comfortable, but at the same time there's a, you are sacrificing something to get that comfort.

Sunitha Rao (9m 22s):

Absolutely. I mean there's always a trade off with every decision you make, right? With with a job you are losing a little bit of like the autonomy, but you do get some sort of steadiness. There's a caveat to the study so there's like a little asterisk because it's steady until the powers that be don't want it to be steady anymore. Right. And even with entrepreneurship you can influence more the journey, but there's a little bit more volatility and there are challenges on that end as well. You know? And so even though real estate investing is the best thing that could have happened to me, I'll say that it's a journey that you wanna think through before you embark on it because it can be really tough. And even though it's the best thing that's happened to me, it has been very challenging on my life and like my relationship, my mental health, you know?

Sunitha Rao (10m 6s):

So it's something to to consider carefully.

Etinosa Agbonlahor (10m 11s):

Those challenges are definitely something I wanna ask about later in the conversation. 'cause one of the reasons I started this podcast was because people don't talk too much about the, the challenging part. They don't talk about the effect of real estate on your mental health. For example, what happens when everything hits the phone and a tenant calls because a light bulb broke and you're just like, I swear to God,

Sunitha Rao (10m 30s):

I mean I wish they called me 'cause a light bulb broke. Usually my problems are so much bigger. Yeah, I'd be so, so happy if that's, that was the reason

Etinosa Agbonlahor (10m 40s):

I've had those calls where you're like, oh boy, okay, which of those things am I going to deal with first?

Sunitha Rao (10m 45s):

Or am I just gonna cry first and get that outta the way?

Etinosa Agbonlahor (10m 49s):

So let's start with the moment when you are signing papers for your very first rental property. You've gotten to this place because there was a lot of introspection, you had that moment with your boss and you're like, something has to change and you do the work and now you are here. What are you feeling as you're signing those papers?

Sunitha Rao (11m 7s):

It was just so weird. I think I felt a little bit numb because like I was just, I was just, it's just surreal, you know? And you're kind of like, is this really happening? Am I really doing this? Like am I really wiring over my entire life savings for this? Like for this, which I have no knowledge, nobody around me has any knowledge. I just read books for two years and I hope the books weren't lying. So, you know, there were some nerves, but I think the bigger thing that I was afraid of was not trying because I could not see myself 10, 20 years down the road living the same life and never having tried anything else. It would be so much regret.

Sunitha Rao (11m 47s):

And so, you know, if this doesn't work, it doesn't work. And if I lose my money I lose it. But at least I try to give myself another option and I can make back that money down the road. Definitely not ideal. I come from like a very financially scarce mindset due to my background. So like that's definitely not a path that like I was allowing my mind to go down the, the path of losing the money, but that was the truth. I could get it back. And so yeah, the risk of regret was like the bigger risk to me.

Etinosa Agbonlahor (12m 19s):

That's interesting because for a lot of people the risk of losing the money is the bigger risk.

Sunitha Rao (12m 24s):

Yeah. But I mean like, okay, so like I think that house at that time was like 90 k whatever I to put like 25% down and then with like repairs and stuff, I can't remember, maybe it was like 35,000 all in. That was an enormous sum of money to me at that point. I'd never had that much money of my own in my life in one place. But yeah, so then what? Like if I, if I, if I lose it, I work another two years, three years to save that back up again. Hopefully less because hopefully my career would be like I'd be earning more. But like that versus thinking about being 55 and still working the same job, giving up weekends or being, I don't know, in my forties and having a family, not being able to come home in time for dinner or having to answer emails while at a baseball game or like this just, that's just not that wasn't it.

Etinosa Agbonlahor (13m 19s):

Something I've also heard you talk about is at the time you were very intentional in trying to buy in higher income areas and you had of wanting good assets in a stable area even though it would give you a lower return compared to, I think you mentioned your friends were buying like, you know, they were making a lot more money or getting more cash out of their properties but they weren't necessarily in areas that you wanted to invest in. This episode is sponsored by the Her First House community called Fireplace. You can learn more about the community by going to Her First House dot org. My goal for the podcast is to get people who say hey, because of Her First House, I felt confident buying a home.

Etinosa Agbonlahor (14m 2s):

I felt confident buying an investment property and listening to the podcast episodes will help you start to build those muscles. But I also feel that community is really going to be where it's at in terms of actually starting to feel comfortable taking some of the great information you're going to learn on the podcast and putting it into action and also having the support from everyone around you to be able to do that. I wanted fireplace to get to that campfire essence where there's comfort, there's warmth, and if you're with the right people, there's vulnerability and a chance to see yourself in a different light. Once you are in, we have some really great resources, you can hop on a call with me and everyone else in the community, ask any questions you have, hear what other listeners like you are up to in their own journeys.

Etinosa Agbonlahor (14m 45s):

You get vetted list of resources. I personally attended, read or used to grow my portfolio, access to training from experts, maybe even special private community sessions with guests who come on the show for our brand new podcast. We are starting small, which means that the first few members in the fireplace community will really get that support and undivided attention. But we are excited that the community is going to be the strength of this podcast and it's really gonna drive the why behind Her First House. So check it out Her First House dot org. I'm curious about how you learned that because I only intentionally understood the difference between, or the importance of the area you're buying in.

Etinosa Agbonlahor (15m 30s):

When I sat across the table from Pete Fordo who is almost 80, I think Pete is almost 80 and he's been invested since before I was alive and he sat me down and he was like, lemme tell you, you wanna buy a good house in a nice neighborhood and put nice people into it and that will reduce the amount of stress that you're experiencing. Anything different is what leads to burnout in this game. People buy these big high-risk houses and they get super stressed out because it takes all of their time and effort to keep up with it. How did you learn that? Because I imagine like Pete didn't come to you and tell you

Sunitha Rao (16m 3s):

No, I, I would've loved to pick his brain, but no, I think there were two aspects to that decision. One, I was doing this in order to build a better life for myself and better meant easier. I didn't want to keep trading my time for money. That's why I got into this. And it felt like, while I never really bought into the it's passive income, like it just made sense to me that if I was in an area that wasn't as good where I would get people, tenants in who had to be there because of however life happens to them, I felt like that would be more difficult for me to manage in the long run than a nicer area where they're the good school districts and frankly like areas that have good school districts, there's so much supply, sorry, there's so much demand that prices keep increasing and for the, for much of the population it then becomes difficult to afford that.

Sunitha Rao (17m 5s):

So the families, the parents who think ahead because they wanna have give their kids the best chance, they're also gonna plan ahead. They're not gonna wanna be kicked outta a home because they were flagrant with their money and now they can't afford a home and now their kids can't go to that school. That sort of thing. And so that was really where I wanted to be and several of my properties in that area were by definitely not by any means the nicest, but they were in that area and that was all that I cared about. So that was number one. And then the number two piece was I have a background in business in finance and so like the idea of what a good investment is, is understanding value in what you're buying that others don't see and it's seeing that value before they do.

Sunitha Rao (17m 53s):

When I was looking at investing and I was on BiggerPockets forums and I was networking, everybody was talking about the urban areas, the rural areas, but then they'd also talk about how their places got shut up and this, that and the other. And I was like, this doesn't make any sense. And they did talk about the cashflow, but I really wanna make a delineation here. What they were talking about is projected return, it's not actual return. And so they're saying, yeah, I'm buying this duplex for like $32,000 and then they're gonna pay me $600 a aside. And I'm like, this what? Like I, I get it, I get you're gonna be making a thousand dollars a month, but like I don't think that the tenants were gonna like want to live this area are gonna leave you a pristine unit.

Sunitha Rao (18m 40s):

You know, they're just, they might not care as much, you know and So, I just like, it just, it didn't make sense to me and also it didn't make sense because everybody was there. So if everybody's talking about it, the value and I'm using air quotations for those who can't see me because I don't think that there's like that much value in in those assets unless you do it like in volume in specific ways. But the value there is already discovered So I wanted to go to a place where people weren't talking about yet. And so like I looked at the areas that were voted like the best place to live and like some of those areas were like up north side of Indiana. And of course you can't get into those areas like the best places to live, but like I went into similar areas where like that weren't voted as high but still had the same school district and still had like similar characteristics.

Sunitha Rao (19m 29s):

So like people who couldn't afford to be in the best areas would then go there because they would still be able to get the similar benefits for their families.

Etinosa Agbonlahor (19m 36s):

Oh that's clever. So you went where it's been rated best place to live. What are the other areas that are in the same zip code or in the same school district that are adjacent to that area? Oh interesting. I've never heard anyone like say they did that.

Sunitha Rao (19m 50s):

So yeah, there's like If, you look at like money and Forbes they usually come out with like these lists and that was what I looked at So I think, yeah, I feel smart now.

Etinosa Agbonlahor (20m 2s):

Well it was a clever thing. I haven't heard anybody else go like I was very intentional with how I like chose where I wanted to invest. Other people went on BiggerPockets and were like, let's just read what everybody else is doing. And that's how you end up with a two 30, $2,000 duplex. Well

Sunitha Rao (20m 16s):

I think like in anything in life and investing is the same way. If, you are doing what everyone else is doing, you're probably doing it wrong. You know, like you need to be thinking differently. That's where the value is added. Whether you're at a job, like if you're putting the same spreadsheet together, plugging the same numbers, like you're not gonna get the promotion. You have to think differently and see what else is going on around the periphery and go that way.

Etinosa Agbonlahor (20m 39s):

So is that still the strategy that you pursue when you're buying property now?

Sunitha Rao (20m 44s):

I wouldn't say necessarily I, I wish I could but now people know more so, so and there's only so many areas you know in it down. So like it's really funny because I just was on a duplex last week and I was telling you in our first conversation, like my first purchases were like in the suburbs in these areas and then it took me six years and then like the highest historic interest rates we've had in like two decades or whatever to get back into those areas. So like they got more, the word got out as people got more experienced in the rural areas, in the urban areas.

Sunitha Rao (21m 24s):

How do I keep saying rural? I mean say urban in the urban areas And like I've had, I had friends who had like their doors taken off the hinges by the tenant and they drove by and the tenants selling the doors in front yard and stuff like yeah, yeah like the front door to the house just like for this, oh my god. And so enough stories like that circulated where people were like, okay, where does this not happen? Okay, let's go to the suburbs. So then people were gonna the suburbs and that was completely insane because like I underwrite very conservatively So I guess partly that's my fault but like I won't change my ways but people were offering such high offers on these properties and suburbs where I was like never gonna catch whatcha doing, you know?

Sunitha Rao (22m 9s):

So it was just like that moment of like where everyone wasy kind of took over for several, several years. So Now it, I would look for that if I was in a new city, but I'm pretty established with where I am. I have my teams, et cetera. And so here there aren't really any secrets as much,

Etinosa Agbonlahor (22m 28s):

But at Vista you've kind of built the team, you've built all of the efficiencies that allow you to continue to to do it.

Sunitha Rao (22m 33s):

Yeah, it makes life easier.

Etinosa Agbonlahor (22m 35s):

I think that point you made about, it took you six years to get back into that neighborhood where you had initially started buying. First of all, congratulations on like the latest acquisition.

Sunitha Rao (22m 46s):

Thank you.

Etinosa Agbonlahor (22m 47s):

Well I think there's something about investing for the long term versus investing for cash flow and that's kind of what you're hinting at where I know it's a good area, I know it's a worthy investment. I'm gonna take as long as it takes to like get back into that area. 'cause I know that's where the, like the value is. I know that's where the portfolio should be as opposed to what's gonna cash flow tomorrow. Like how can we, how do we get into that space? And it feels like there's, yeah, so always looking at like what is the balance between, in the long term this is a really good investment but also in the short term like this is gonna cover the mortgage and leave me with reserves.

Sunitha Rao (23m 23s):

Yeah and that was exactly the thought process that went into this purchase because with interest rates being higher, I like to have more of the arbitrage opportunity between the mortgage and the rent I'm getting than I like. But at they've been, the tenants have been amazing. I found like really good tenants I could work with and like I know I was looking up like the city plans, the city's gonna be investing like a hundred million over the next three years in this small stretch that's like four or five blocks to like redevelop it and build new roads. And anytime that happened, like my life has been changed, like has been turned upside down in terms of that investment in like the best ways in terms of appreciation and long term growth.

Sunitha Rao (24m 10s):

So like I'm like, okay, yeah my might be tight for like a year or two, but I think long term, I don't think long term, the biggest gains that I've seen for myself and others like comes through forcing appreciation, you know, and that can be through the repairs and updates that you make and that can also be through market appreciation. But the market appreciation usually needs additional external factors in order to really drive that price up. It can't just be like, oh it's a nice neighborhood, nothing else is really happening, it's just a nice place. There's like infrastructure being built, there's slippers like being forced out of certain areas and so due to pricing and so they've gone into other areas and they're buying stuff up and like fixing them up or people like, yeah.

Sunitha Rao (24m 54s):

So it's like it's stuff like that that you're kind of looking for. So yeah, I'm super excited for long term.

Etinosa Agbonlahor (24m 59s):

Yeah, like that you're looking for that intentional like economic development or

Sunitha Rao (25m 3s):

Yeah, that's a great way to put it. Yes, I can remember that.

Etinosa Agbonlahor (25m 7s):

So let's zoom out to a different moment. You are making the decision to leave professional tennis, which is something you had done for more than a decade at that stage and, and you are in the top 200. So before I even ask the question, I want to ask what does it mean from like a numbers of hours invested effort, et cetera? What does it mean to be in the top of a sport across the world?

Sunitha Rao (25m 29s):

It means you know nothing else. It means you're likely traumatized. It means like you eat, sleep and breathe that sport. It means that many times you don't have an identity outside. It also means that you learn to adopt very important characteristics and skill sets at a young age like resiliency, like long-term gratification, like strategic thinking, you know? So it's very much of a mixed bag. Like it's, there are parts of life that are very tough for me now after all those years around people around adults who were just looking to use you for their own personal gains. But also when I turn around and I look at how those who have gone through that journey, like with me, how they're doing as adults in the real world, man are they crushing it?

Sunitha Rao (26m 17s):

You know? And so like we really, there's very strong pros and very strong cons to that life.

Etinosa Agbonlahor (26m 24s):

Are there things that you take from being a pro athlete that kind of inform specifically how you run your business today?

Sunitha Rao (26m 31s):

Yeah, I mean there's the concept of just working really hard. You know, when I started the business I was working full-time in corporate finance out in Boston, which in itself is demanding. I was also working my way through grad school, getting my masters and I decided to start business at the same time because I'm chaotic So, I can't, I can't live an easy life or just relax.

Etinosa Agbonlahor (27m 0s):

Like 24 hours in a day is enough to do seven different things.

Sunitha Rao (27m 3s):

Yeah, it's, and I only need to sleep like two hours. We got this

Etinosa Agbonlahor (27m 7s):

Needs to eat, that's for weak people.

Sunitha Rao (27m 10s):

Overrated drink water, never heard of her. So like in the tennis world, like from the time I was very young I heard If you are not training if you're not working. There's a little girl in Russia who is, you better get out there, you know? And so the same kind of competition isn't, isn't quite there in the normal world it doesn't quite work like that. But yeah, you learn to like kind of sacrifice everything and just like go very singlemindedly after your goals. And so that was, that was very, very helpful for me. And then also just like you learn from your mistakes. You, like in tennis you lose almost every single week and that is normal and it sucks, but every time you lose, you like debrief, you figure out what, what went wrong and it's putting is an option you like, you're like, okay, how do I do this?

Sunitha Rao (28m 1s):

How do I learn this? How do I do this better? How do I get back up? You know, and how do I improve? And so that's been really beneficial in real estate, that thing because it's a, it's difficult, you know? And just the six years I've been doing this, there's so many people who get in and then two years later they're like, holy, this is not for me. And I'm just like, what do you mean it's not for you? There's so much upside. Like I know it's hard but like yeah it's just, it's just learning that like good things don't come easily. Things that are really worth, it can sometimes take a lot of pain but it is that pain that will transform your life. You know, If, you just know how to know, have to know how to deal with it and keep moving forward.

Etinosa Agbonlahor (28m 40s):

I love that. I also contrast that with the YouTube guru mindset of just like jump in bro. Like so much arbitrage opportunity, so much like just, it's just so easy. Here's the, what is it, a Porsche, the Lamborghini you get, oh

Sunitha Rao (28m 54s):

God that makes me wanna vomit.

Etinosa Agbonlahor (28m 56s):

It's hilarious to me because when you sit with actual real estate investors, you're like, lemme talk to you about pain and difficulty on doing hard things.

Sunitha Rao (29m 2s):

Yeah, yeah. And like you, it's so irresponsible to not mention that because there is so much you have, you have to tackle. There's nothing in life that comes that there's no such thing as a free lunch, you know? And that is not to say it isn't worth it because it absolutely is, but you're not gonna get it easily. And those Porsches and lamb green needs don't come soon. Like real estate is not buying a lot of ticket. You have to stick with it for years and years to really see that accumulation that will truly impact your bank account.

Etinosa Agbonlahor (29m 33s):

Absolutely. So there's a point by huffies and it goes, first of fish needs to say something ain't right about this came ride and I'm feeling so damn thirsty. And, and what it means is that there has to be an awakening before change. There has to be a sense of like, ugh, something just isn't working and why do I feel so uncomfortable? And I feel like with you, I see this thread of like you looking around and going, it doesn't feel right, like this is so weird. But it felt like you did that with tennis, you did that with the corporate world and I like I, I study how people make financial decisions for a living. So I'm always fine, I'm always fascinated by this process of like deciding to change.

Etinosa Agbonlahor (30m 14s):

So what was the process like for you of making that decision to leave tennis but also the corporate world and was it the same process? Was it different?

Sunitha Rao (30m 23s):

That's a really good question, but like, I'm gonna go on a side tangent really quickly because I found this funny, I saw this this morning, it was a quote in Forbes that I actually saved a long time ago. And it had something like to understand the path of an entrepreneur, you have to look at a juvenile delinquent. They both look at something say this isn't working and screw it, I'm gonna do it my own way. Which kind of goes along with what we're saying. So yeah, the paths were pretty similar in some ways. So in both I felt like, I think there was a little bit of a feeling where I didn't feel like I could reach my true potential. So within the tennis world around, I retired in 2009 and I had my best year today in 2008 and I was doing really well, but I didn't have any money, I didn't have any family connections.

Sunitha Rao (31m 16s):

I was just like scraping by driving two hours to go hit with someone and trying to call that practice like it was like such like a journeyman kind of approach. And I never really should have gotten ranked as high as I did with this, with that like paperclip approach, you know, just like gluing, we're gluing stuff together, trying to make it work. I knew I needed money to invest in like real coaching, like better physical training. A therapist put my body back together after like all the long matches and like abuse. Like it took all the, all the beating and it was 2008 like the recession was taking place, like company sponsor athletes. But that's done on discretionary income and companies were struggling, like no one's gonna sponsor an athlete at that time.

Sunitha Rao (32m 0s):

And So I realized like, okay, I have a couple options here. I can stick with playing with sport and keep doing what I'm doing, but I'm not gonna reach my potential. Which in my mind was mediocrity, you know? And I, I knew I was destined for more, I wasn't gonna settle for less than that. And So I was like, if I can't reach my potential, like I'm not gonna be here and stick with it because I'm afraid. Like that is to me is that is something I would regret and to admit to myself that that's what I was doing would just be like humiliating, you know? And I was like, I know I can do better so I'm gonna go somewhere else and actually try like to live up to my potential. And so like that was the thought process that had me leaving the sport and then within corporate, like I talked about that moment where I kind of felt trapped, you know?

Sunitha Rao (32m 45s):

And even before that, life was good. Life was easy. Like for the first year or so after I graduated college, it was like the first time in my life that I wasn't like working around the clock or holding three different jobs, you know, because when I was training and playing, I was, I was on the clock all the time. Every decision I made had to be in pursuits of excellences in my sport. And then after I quit, I didn't have money. So I was bartending nights into the early morning, waking up early morning teaching tennis, going to like community college, then going to like a different school, just like working all the time. And so it was nice, it was good. I finally gotta like have friends and have a social life and be like, all right Wednesday sure let's go get drinks at the bar.

Sunitha Rao (33m 25s):

Why not? That was so new to me, but at the same time it was like, I don't know man, like I'm leaving this nine to five and I'm like, I guess today was a good day. Did I do good things today? I don't sure, you know like, but I just had like this feeling that there was like something more like I could do more but it just like, it just wasn't fitting in the corporate world. And then I had that conversation with my manager and yeah, it wasn't until like I got stretched by real estate and like pushed and like forced to come up with new solutions and constantly being challenged. I really started feeling like, oh this is interesting, this is fulfilling for me. And also fulfilling because you get the opportunity to do good in the world.

Sunitha Rao (34m 5s):

Like you control people's housing. And so being a good landlord, like it is so gratifying to be able to help people. You know there's like, I've had tenants who've been with me for like seven years or at this point or six years and they haven't always made rent on time. Like during Covid, one was a waitress with a small kid and she got covid and she's like, well I to isolate for two weeks and then hopefully I'm okay I can go back to work that if I can't work for past a month that means I can't make rent. And I was like, like I hope you're not screwing with me like but let's find a way to like make this work. You know? And like she got back on her feet and then another one lost her father and then fell into a deep depression after that and lost her job.

Sunitha Rao (34m 48s):

And she had, she also had a child to take care of and that took like a solid two years where like I changed the dates on like the lease and she was almost always late and I was like trying to walk the line between being understanding but also like don't take advantage of me. You know? And so sometimes waiv fees, sometimes not, not just to be like I'm trying to help it like this needs to be taken care of. And so with all of them, like I work things out, like life happens to everyone. And so it's just, it was really, it was really gratifying to be able to help them through some of the situations where I know like other people and it was hard for me like how am I gonna pay the mortgage? You know like it's a little bit hard to come up with multiple mortgages when the business model is bent on it on getting the rent.

Sunitha Rao (35m 35s):

So yeah, that's fulfilling.

Etinosa Agbonlahor (35m 37s):

I agree. I was thinking when you were talking, I was thinking about the very first time I went into the first property I had bought and at that stage you had been occupied for about two years by the same set of tenants that I had never seen it in person 'cause I bought it like long distance. So this was the first time I was finally able to like travel down and see it and you know when you buy a an investment property, you're buying like dollars and cents and like you know some planks on a roof. It's like in your mind it's like what is the number? It's all about the numbers, it's all about that spreadsheet. And then you go into the house and like you see that people have made it into a home. There's like family, he had built his son a bed, there was like toys all over the place, she was having another baby.

Etinosa Agbonlahor (36m 17s):

It's like whoa, there's an actual family living here and this is their actual house. Like

Sunitha Rao (36m 21s):

This is their life, this is their memory, this is everything.

Etinosa Agbonlahor (36m 25s):

Yeah, it's amazing. Like to you, to me it's like oh those numbers on the spreadsheet to them it's like this is home, a beautiful family here. And that just like to your point, it was incredibly fulfilling and it just kind of really drove home like wow this is more than just the investment side of things. Like this is powerful. You're change, you could be changing generational narratives here, what you're doing.

Sunitha Rao (36m 49s):

Yeah a hundred percent. Like if sometimes like you're not understanding that someone has fallen on hard times and they will get it back together. Like what do you do? You put them through eviction court then they can't get housing anywhere else, et cetera, et cetera. Like you can completely change things for the worst for them. So it's like really important to, to do the right thing and to help people out as much as you possibly can.

Etinosa Agbonlahor (37m 13s):

So going back to this process of making hard decisions, if we were to like codify that process, if somebody comes to you and is like, I've been a tailor of my life, I'm thinking about doing something different, I wanna go back to school, what would you say to them? Like walk them through that process of like, here's how you decide if this makes sense to do or not.

Sunitha Rao (37m 32s):

God that is so hard. I think the first thing, I think the first thing that I would keep at the forefront of my mind is to stay humble and to stay hungry. You know everybody, there's a point time where almost everybody has to start over in some way, whether it's at a new job or what have you. And you have to be eager and hungry, whatever it is to like get ahead in that area, you know? And you have to be humble like you are starting over. There are gonna be things that are, you're gonna be like should, this is beneath me or whatever. But nothing can be beneath you. Like you just, and the other thing is like If, you think like that If, you aren't hungry or you aren't humble.

Sunitha Rao (38m 14s):

It makes a situation you're in when you're starting over a lot more difficult and then you end up wasting emotional energy on that and trying to figure it out. Like like oh I shouldn't be here. And some of that's normal, some of that's gonna happen but you made the decision because the other alternative didn't work. And it's also beginning, even coming, beginning with the end in mind, right? Like If you, if the current path isn't working, why isn't it working and what does the new path look like? And you just need to stay focused on that end. Like what does that end look like and what do I need to do to get there?

Etinosa Agbonlahor (38m 52s):

I love that. That was very helpful.

Sunitha Rao (38m 54s):

Oh good, thank you.

Etinosa Agbonlahor (38m 56s):

So moving back to real estate, I was looking at the stats you have of your properties on your website and I love the transparency that you have on those stats 'cause not a lot of people do that. So in one property you sold for $102,000 profit with 56 k invested into it with another one you sold for 12 k profit with 16 K invested into it. Now there's a difference between $102,000 and thousand dollars, but people often think that like real estate is just paycheck after paycheck. They don't understand that like the fe of farming like nature of it. But what I'm curious about is what does a good deal look like for you at this stage?

Sunitha Rao (39m 33s):

Yeah, so there are different ways that an investment can affect your bank account and So I try to hit as many of those different ways as possible.

Etinosa Agbonlahor (39m 45s):

Hey quick reminder, all the content you hear on the podcast and in the fireplace community are all for your entertainment and education only. It is not financial advice. Please get advice from a competent financial professional, especially If, you need expert help for your very specific situation. Okay, onto the episode.

Sunitha Rao (40m 7s):

So one of the big things that's talked about that I wanna get outta the way, like right away, depreciation, you get that on every property. So like let's not get bogged down by talking about like the tax benefits et cetera. Like that's just a thing. Obviously cash flow So, I want it to cash flow. If my rent is basically like the lowest rent in the area, because I mean who knows what could happen down the road, but I can always get a tenant if my rent is low enough. And so if I do need to drop it down to that rent because the inflation's crazy high people can't afford stuff, it's winter, it's December, no one's moving in December. Like if I need to drop the rent at that time to get someone in, I can do that and I can still make money. And then there, we talked about this a little bit before, there's different forms of appreciation.

Sunitha Rao (40m 50s):

So like there's forced appreciation. I wanna know that there are specific renovations and updates I can make that will increase the property value significantly more than the money I put to make those renovations. I want to know that the area's improving so that over time market appreciation will take over. And I'm just not reliant on like it being a good neighborhood. There are other factors at play that will draw people to the area over time. And I think the last thing is just built in equity. So making sure that I buy the property for less than it's worth. So that let's say I get into rehab and I discover that the sewer line needs to be late, like relayed out or whatever, you know, and that's gonna be like $50,000, which isn't totally out of the realm of possibility.

Sunitha Rao (41m 37s):

Then I can still sell it at a profit and it'll be okay So I, just wanna make sure that no matter what happens, I am limiting my downside and that there is an upside.

Etinosa Agbonlahor (41m 47s):

So you're looking at all of the different elements that make up a real estate kind of deal, right? Depreciation ability to drive force, depreciation, the cashflow potential, and then also buying it under market so that you can sell it at a profit. Are all of those things equally important to you or, or are there some things where you're like, if it doesn't have this big thing to the deal, I'm walking away.

Sunitha Rao (42m 8s):

That's a really good question. I'll not sacrifice cash flow and I'll not sacrifice built in equity. I also also not sacrifice forced appreciation. It needs to be worth more. I guess if I had to, I could sacrifice a little bit of the market appreciation if I had all the other pieces because at least like I still know it'll be worth more then it was when I got it. And my net worth is positively impacted by the work that I've done.

Etinosa Agbonlahor (42m 31s):

Okay. So as long as you know that you can put the work into the house, sell it at a profit and you're getting it a little bit under market, you're

Sunitha Rao (42m 39s):

Yeah.

Etinosa Agbonlahor (42m 40s):

Okay. So at the stage you own about 12 doors, is that That's right. Right? Yep. You own 12 doors. And of that portfolio, what is a property that you are most excited about?

Sunitha Rao (42m 52s):

So that would be the last house pack that I did. I really love that home. It meant a lot to me because it was the first duplex that I house packed and it was the first time in my adult life that I could live in an area that I wanted to live in and I could afford to live there for that. I made a lot of decisions to save money and to make my life a little bit financially easier. And then I also house packed a single family home, which had a pretty like rough journey and So I was really excited to get into this area where I could have that I could also live on my own and still have like my mortgage mostly taken care of. And it was like a mile from like a paved running trail and it was two miles from like two of my really good friends.

Sunitha Rao (43m 38s):

And so like I could run and see them at any given time, you know? And it was like super close to downtown. It just, and it was like this adorable house, like it was super old but it was like entirely brick. It's original hardwoods we built in that just had so much character and the area was improving. So there was that too. And So I moved into one side, fixed it up, rented it out, moved into the other side, fixed it up too. And then in the process of fixing it up, like there was, it's just like this really big house. And so when I was originally walking it, I was like, oh, there's so much opportunity here. Like the attic is massive on each side, the basement is massive on each side. And I was just idly like talking through things my, wouldn't it be cool, I could like turn the upstairs into a living unit, like the attic.

Sunitha Rao (44m 24s):

I could do the same thing with the basement and it turns out like not all of that is feasible, but what I did do was I did finish the basement on one side and it turned it into an Airbnb and that like I essentially was the GC for that project, which was a huge project and a massive learning experience and it turned like it's a place that I'm really proud of. And then because of the fact that the bottom was an Airbnb, I really needed to turn the top into an Airbnb of how like sound leaks and they shared an HVAC unit, So I have to control the temperature in order to make sure everyone's happy and that sort of thing.

Etinosa Agbonlahor (44m 58s):

So was it that you couldn't have long-term tenants in the top unit and have people come in and going from the bottom unit?

Sunitha Rao (45m 4s):

Yeah, or I can't really have a long-term tenant in the bottom unit. They're not gonna be happy long term, you know, because there's just too much sound that comes through and if someone is a, a long-term tenant up top, they're not gonna be happy with me being like, I control the temperature, you know? But like short term both work. So that was how I rationalized that. And then there's so many large Airbnbs in the area with people turning their homes and whatever into Airbnbs. I was like, what is my competitive advantage? I wanted to do something like really interesting and unique and So I turned the upstairs into a themed Airbnb and I call it Burton bungalow. It's entirely nightmare before Christmas themed, including a six foot, more than six foot tall Jack Skelton in, in one corner of the living room.

Sunitha Rao (45m 51s):

And there's like Christmas lights hung from the ceiling and there's multiple Christmas trees and every night there's a light show and it's just like so ridiculous and over the top, but it's like so magnificent at the same time. And so that's been like my baby. And so it's been a tough year with the Airbnb market 2023, you know, there's a lot of supply coming on the market, so it was a little bit tough. And it was like my first time with a big Airbnb, I had like two smaller units, So I, like knew the pricing, the strategy, but with a big unit it was a different, like entirely different ballgame. It took me a little bit of time to like kind of figure it out. But yeah, like it's been, that's what I'm like really excited to see about, to see more people come through there. Like people who book there end up really loving it, you know, because they're there for like the experience and it's so fun.

Sunitha Rao (46m 36s):

So I'm just excited to like continue to grow that and share that with more people.

Etinosa Agbonlahor (46m 40s):

That's awesome. And what is it, is it like three bedrooms, two bedrooms? What is, what is the kind

Sunitha Rao (46m 45s):

It's three bedrooms, two bathrooms. It's like 15 to 1700 square feet. So it's like pretty big. Yeah, like all stainless steel appliances in the kitchen. Like, it's like the kitchen's black and white, like shades of gray. It's just, yeah, I love that home.

Etinosa Agbonlahor (47m 2s):

It sounds amazing. That

Sunitha Rao (47m 3s):

Was another part of the investing journey because I really loved living there, but I just had a bigger dream for the place and something that I wanted to do creatively and to fulfill me. So it was like a little bit sad to move on and to not live there anymore, but like, oh no, I think that's also some part of the journey that like you had, sometimes you do get attached to properties and you just have to learn to like make those decisions.

Etinosa Agbonlahor (47m 24s):

I was also reflected on, you said you moved into one side and then you renovated the unit that you were living in living and then you moved into the other side and did the same thing.

Sunitha Rao (47m 33s):

Yeah. Which

Etinosa Agbonlahor (47m 34s):

Is interesting because I feel like most people would move into one side, renovate the other side and then move out and renovate the one they just ated.

Sunitha Rao (47m 41s):

Yeah, well I didn't have money to do that. Like I couldn't, like I needed, I was lucky in that it was mostly cosmetics. Initially So, I could get in and I could paint and I could learn to tile the kitchen and do stuff like that and swap out like fixtures. Wow. Yeah, I mean I didn't do, I ended up adding a bathroom and doing some technical work and for that I hired out. But like cosmetics, yeah, I did all of that and yeah, I had to owner occupy it. Like I had to occupy it and both sides were tenanted when I bought it. And So, I had to have, I paid one side to move out and they needed, they wanted a king's ransom, which is fair, very smart on their, on their part.

Sunitha Rao (48m 21s):

But yeah, so in with one side moving out, I couldn't afford afford to renovate the side. That was unoccupied.

Etinosa Agbonlahor (48m 28s):

So my final question is in a quote that you had in one of your other interviews, you talked about not feeling like you had a purpose. You left tennis and I'm, I'm reading this doctrine to Philip's book, it's called The Garden Within. And she talks about purpose as like this connection to like service every day. Like, you know, today she helps her kids with the homework and that's a purpose tomorrow she goes like, please do stuff in her garden. That's a purpose. It's the idea that like it's every day looks a little bit different and there might not be like this big grand purpose that everybody has. But I was wondering for you, how do you think about your purpose these days?

Sunitha Rao (49m 4s):

I find a lot of fulfillment with the real estate. You know, like I get to build a life that is challenging and interesting and unique and helps me financially sometimes know it does help me a lot. But then, like I said before, like I get to give good housing to people, I get to help them. And then with Airbnbs I get to give people a fun experience. You know, like people like to take vacations and you want, you want them to have a good experience. So that's like really fulfilling to me and like combining that also with my day job, afford anything like that was a big brand that I liked a lot long before I joined the company. And so like I find purpose in, in like this dual kind of path of improving my life, building more autonomy into my life so that when, when the time comes, like I can be work optional or cut back if I want to, you know, when I have a family and stuff.

Sunitha Rao (49m 56s):

But then also do good in the world as I'm doing that.

Etinosa Agbonlahor (49m 60s):

I really like the term work optional. I haven't heard that before. That's a really good way to describe it.

Sunitha Rao (50m 4s):

I think there's like freedom that comes from that. You know, like you, you, you get to do it. You do because you wanna, not because you have to.

Etinosa Agbonlahor (50m 10s):

Yeah. I'll say I know a lot of real estate investors who hit their like financial freedom number a long time ago and they're all still investing in real estate.

Sunitha Rao (50m 18s):

Oh, absolutely. Yeah. I don't, I don't think it's, it's been an addiction.

Etinosa Agbonlahor (50m 22s):

Hundred percent addiction. Yes. All right, thank you so much. Sun. Where can people find you

Sunitha Rao (50m 28s):

Mostly on Instagram these days? So my handle, my personal handle is Sunni S ui ao. I check Burton's Bungalow, Burton Bungalow is the IG handle for my Airbnb, so that's B-U-R-T-O-N-S, Burton. And then Bungalow as you would spell it. I probably check that more often than my personal. And then I do have a website for property Group com.

Etinosa Agbonlahor (50m 55s):

Awesome. Thank you so much.

Sunitha Rao (50m 57s):

Thank you for having me. This is fun.

Etinosa Agbonlahor (51m 1s):

Thank you for listening to today's episode. Remember to check us out on Her First House dot org and join the community for access to bimonthly calls with me and everyone else in the group, as well as loads of cool resources. Also, like share this episode with two people and tell me what you liked or learned from the episode by tagging me on Instagram at realestate with etti. That's real estate with ETI. We'll see you in the community and on the next episode.