Growing up, Dave Allred never saw himself as a millionaire. Allred grew up in a “dysfunctional” and “very low-income, blue-collar” family in Utah, where his parents never taught him about money or investing. When he was 17, he ran away from home and moved into a small house with cockroaches and a caved-in roof, where he subsisted solely on fast food and noodles. But, in the end, Allred is thankful for his childhood experiences.
His childhood motivated him to try to reset the whole standard and level up everything for his own family and legacy.
Today, at the age of 42, Allred manages an impressive real estate portfolio that includes ownership in over 1,250 units across 30 different properties in 15 states, according to documentation. It also includes how his portfolio equity has now grown to more than $30 million in total value.
Allred has never shied away from big dreams. Indeed, he attributes much of his current success as a real estate investor to setting “audacious” goals for himself and achieving them by any means necessary. Allred’s first taste of success came during a summer job selling Vivint home security systems door-to-door in Chicago, a job he was initially hesitant to take. “I knew it would be difficult and not something I wanted to do. Nothing is enticing about door-to-door sales “Allred stated. “However, I’ve always been drawn to doing difficult things.”
The job proved to be by far the most difficult challenge Allred had ever faced. He recalled “failing miserably” during the first month, and roughly 80% of his team quit before the summer was over. Allred was tempted to join until he learned from one of the owners that anyone who sold at least 100 security accounts would be eligible to become a sales manager the following year.
“Something clicked for me, and I was like, you know what? “I can become a manager, make more money, become a leader, and build something with real meaning here,” he said. “So I decided to go all in.
That summer, Allred sold over 100 accounts, earning $31,000 — the most important money he’s ever made. That was his first taste of success, and he became addicted quickly. Allred was eventually offered a full-time position with the company as a regional sales manager, which would require him to drop out of college. He decided to drop out of school just nine credits short of a business degree to work full-time for the home security company.
It was also around this time that Allred became interested in real estate after learning from his accountant that all of his wealthy clients were investing in real estate.
Around the age of 23, Allred made his first real estate purchase, a $125,000 all-cash townhome. The following year, he purchased four more townhomes for around $100,000 each, all cash from a foreclosure sale.
After the townhomes doubled in value four years later, Allred sold them all to buy four fourplexes, each worth $550,000 and requires a $200,000 down payment. Allred used a 1031 exchange to transfer his entire sale proceeds into his new properties, which meant he didn’t have to use any of his own money in the transaction.
Apart from the real estate business, Allred’s decision to drop out of school had paid off handsomely by the age of 26, he had become a millionaire solely through sales commissions. That’s when he set his next goal: to make $3 million by the time he was 30.
After four years, Allred’s four fourplexes had increased in value to around $800,000 each, so he sold them and used 1031 exchanges to double his properties once more.
“So I sell one fourplex and I have $500,000 in equity in it at the time and use that equity to buy two more fourplexes with no cash outlay. So I went from four doors to sixteen doors, and then from sixteen doors to thirty-two doors with no extra cash out of pocket simply by using the equity appreciation as a down payment “He elaborated.
Conclusion
Allred discovered his love for working with real estate funds through the syndications he was involved in because of their structure and diversification benefits, which can help investors mitigate downside risk. “You can go fast on your own; you can go far with a team,” he explained. “That’s what initially drew me to the fund model.”
In 2020, Allred decided to launch Axia Partners, an investment firm focused on recession-resistant real estate, to maximize value for more investors and assist them in navigating particularly volatile markets. The company already has two funds and is currently raising capital for its third.
Source: Insider
