Jun 9, 2025 · 1h 23m · paul-morris
How to Tell if a Property Will Actually Make You Money
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Host Paul Morris and veteran investor Sam Raffae break down foundational real estate investing strategies, covering off-market deal sourcing, conservative underwriting, value-add development, and building long-term generational wealth.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. How this is scored →
Paul as informed peer 6.1 Guest teaching 2.6 Guest disagreement 1.3 Paul pushing back 1.1
speaking balance: gold is Paul, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 1:01:15 Raffae dismisses 1031 tax deferrals
Raffae firmly pushes back on standard investor reverence for 1031 exchanges, flatly stating it is just delaying taxes and passing liabilities to his kids.
Hardest push from Paul ▶ 14:05 Morris challenges yield figures with precise mathMorris halts the conversation to calculate whether the stated purchase and rental figures actually produce the claimed 7% return, clarifying it is only 5.7%.
Biggest teaching moment ▶ 56:15 Raffae reveals a neighbor outsmarting him on lot splittingRaffae teaches a humble lesson on value-add potential by showing how a neighboring buyer split a lot to double their return when he thought they overpaid.
Paul holds their own ▶ 26:00 Morris details his blind pricing calibration methodMorris exhibits deep investment domain knowledge by explaining his method of covering comp prices to master neighborhood valuation within 48 hours.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Paul as informed peer | Guest teaching | Guest disagreement | Paul pushing back | Why |
|---|---|---|---|---|---|---|
| Sam Raffae's Immigrant Journey and Overcoming High-Interest Debt | 3 | 2 | 1 | 0 | Paul Morris warmly introduces Sam Raffae and inquires about his background immigrating at 19 with credit card debt. Raffae explains his mindset and 10-year retirement goal in a completely cooperative, conversational rapport. | |
| First Property Deal and the Core Investment Formula | 6 | 2 | 1 | 1 | After Raffae recounts his first $32k purchase, Morris demonstrates industry expertise by deconstructing complex multifamily marketing brochures down to four core investment variables. Raffae agrees with Morris's practical framing. | |
| Target Return Yields and Purchasing Below Retail Price | 7 | 3 | 2 | 2 | Morris does real-time mental math on Raffae's rental numbers, testing whether a 10% gross target actually pencils to 5.7% net. Raffae clarifies his absolute rule against paying retail prices, emphasizing the necessity of deep discounts. | |
| Mastering Local Markets and Sourcing Absentee Property Owners | 8 | 2 | 1 | 1 | Morris delivers a detailed, expert walkthrough of his two-day Santa Monica driving exercise to master submarket pricing. Raffae elaborates on how investors can leverage title companies to source absentee owners. | |
| Partnering with Investor Agents and Swift Decision-Making | 7 | 2 | 1 | 1 | The conversation covers working with investor-focused realtors and making fast decisions. Morris recounts personal experiences complying with broker rules and handling lender stipulations to secure deals. | |
| Due Diligence Precautions and Maximizing Highest and Best Use | 6 | 4 | 1 | 2 | Morris prompts Raffae on past mistakes, leading Raffae to recall a foreclosure lien oversight. Morris highlights title insurance protections before both explore highest-and-best-use strategies like lot splits and ADUs. | |
| Evaluating Alternative Real Estate Assets and Rental Strategies | 6 | 3 | 2 | 1 | Raffae expresses skepticism toward 1031 exchanges, framing them as merely passing tax burdens to kids, while detailing his profitable storage facility purchase. Morris validates unconventional asset classes like Section 8 and seller financing. |
Statements from this episode (12)
Raffae details his first flip: bought for $32K, sold for $75K
“The first home I bought. It was a 32,000 dollar home... And I bought it for 32, fixed it up. Sold it for 75... It was 17,000 I put into it because it had major repairs.”
Morris never underwrites market appreciation into real estate deals
“When I look at a deal, I don't build in appreciation.”
Raffae: Palmdale houses cost $400k and rent for $2.5k–$3k
“So you could still buy a house for 400,000. And you could rent it for between 2500 to 3000 dollars.”
Raffae: Targets 10% gross yield to achieve 6–7% net ROI
“I, I'd like to get 10% gross. So I can end up with six to seven percent return on my investment.”
Title companies provide free owner data in exchange for future business
“The title company can give you that information, providing that if, when you buy The property use them. For the service. So, so it's a win-win.”
Raffae buys properties sight unseen based on local market familiarity
“Being familiar with the area and the neighborhood, I bought houses without even seeing them.”
Morris: Handwrite envelope addresses on direct mail to avoid the junk-mail filter
“In a mail situation, mailing situation, I would say that You know, you're not sending out thousands of these. So I would hand write the address on the envelope so that it doesn't look like junk mail.”
Morris: Find investor-friendly agents by asking dominant brokerage managers directly
“A great way to do it would be to physically walk into a brokerage in that area and ask to see the manager. And then say, Hey, I want, you know, I'm a potential buyer. I'd like five minutes of your time or 10 minutes of your time... And I would walk into that o…”
Raffae: Working with friend realtors can cost deals due to over-caution
“When you're dealing with a realtor that is a friend, right? He's extra cautious. And sometimes that extra cautiousness could cost you a property. Like it's hard for me to, for example, to tell my friend, oh, this is a great investment because in case something…”
Raffae: California zoning permits adding both an ADU and junior ADU
“In California nowadays, you can add an ADU. So if you have a, you know, large enough lot. You can add an edu to it. And then again, now that you can add a junior ad.”
Raffae: Real estate beats businesses through leverage despite lower cash flow
“I mean, businesses is another way to invest, and businesses usually gives you much more cash flow than real estate does, but the business, in 99% of the cases, you gotta pay cash for the business. Real estate, you put five, 10, 15, 20% down, and the rest is th…”
Raffae: Storage facility brokers favor established operators over new investors
“What I mean by specialty is that even the realtors that they deal with storage units. They have their own clientele of storage unit owners, and they work together. And sometimes for you to come in, they, they'd rather deal with somebody that is familiar with t…”