Adam Torres and Adiel Gorel discuss real estate investing.
Subscribe: iTunes / Spotify
Apply to be a guest on our podcast here
Show Notes:
Everyone in the US knows that the 30-year mortgage exists, even Warren Buffet talks about it, why is this so special? In this episode, Adam Torres and Adiel Gorel, Founder & CEO at International Capital Group (ICG), explore ICG and the community of tens of thousands of investors.
About Adiel Gorel
Adiel Gorel is the CEO of ICG, a prominent real estate investment firm located in the San Francisco Bay Area. Since 1983, he has successfully assisted thousands of investors with purchasing U.S. properties.
Through ICG, he has personally invested in hundreds of properties for his own portfolio and facilitated the purchase of over 10,000 properties for ICG’s investors in Phoenix, Las Vegas, Orlando, Tampa, Jacksonville, Miami, Dallas, Houston, Austin, San Antonio, Atlanta, Nashville, Huntsville, Boise, Oklahoma City, Tulsa, Salt Lake City—to name just a few.
Mr. Gorel holds a master’s degree from Stanford University. His professional experience includes management and director positions at firms that include Hewlett-Packard, Excel Telecommunications, and biotechnology firms.
About International Capital Group (ICG)
ICG assists investors in acquiring single-family home investments in prime locations across the best U.S. markets. With as little as 20% down, qualified investors can start building substantial, long-term wealth that can last for generations.
The properties financed through ICG come with fixed-rate loans, ensuring that loan payments remain unchanged despite fluctuations in the cost of living. This strategic combination of leverage and fixed-rate financing allows investors to grow their estates more quickly and securely.
Full Unedited Transcript
Hey, I’d like to welcome you to another episode of Mission Matters. My name is Adam Torres, and if you’d like to apply to be a guest on the show, just head on over to missionmatters. com and click on Be Our Guest to Apply. All right, so today I have on the show Adiel Gorel, who is founder and CEO over at International Capital Group, also known as ICG.
Adiel, welcome to the show. Thanks for having me, Adam. It’s a pleasure. All right, Adia. So I’m excited about today’s topic. We don’t talk about this. I believe often enough. So we’re going to talk about the miracle investment gift and strategy of the 30 year fixed rate loan and also what it looks like to invest in single family homes.
And as we get into that, I like to start this episode the way that we start them all with what we like to call our mission matters minute. So, Adiel, at Mission Matters, our aim and our goal is to amplify stories for entrepreneurs like yourself, for business owners, for experts. That’s what we do. Adiel, what mission matters to you?
To get the word out about exactly the topic that you just mentioned, the miracle gift given only in the United States, to the best of my knowledge, called the 30 Year Dream. It’s a fixed rate loan, which nobody’s hardly anyone sees. And I want to put the word out because it is a life changer and I’ll explain why.
And it’s a great, great way to tee up this topic. And you know, everybody, at least in the United States, I mean, we’ve all heard of this, right? The 30 year mortgage exists. I mean, Warren Buffett talks about it. A lot of the financial geniuses have mentioned this over time. But why is this so, special and why are you so passionate about this topic?
Well, most Americans have been born into this as a fact. They think it’s normal. That’s the reason I’m not retired, by the way. I could have retired over 20 years ago, but I need to put, I feel like I need to put the word out, because this is a life changer. So when I speak in Europe, as an example, I tell the Europeans, my Americans can get a loan called 30 years fixed.
And they say, well, what does that mean? I say, well, Like the name implies, the monthly payment, principal and interest, never ever changes, it’s fixed. And also the loan balance, how much you owe, also never changes, except to go down with your principal payments, but it doesn’t keep up with the cost of living.
The Europeans treat me like dirt. No way. You don’t know what you’re talking about. That’s impossible. I can’t believe I drove a hundred kilometers to hear you speak. It’s complete rubbish. It’s not possible. And we are going to prove to you that it’s not possible and that you don’t know what you’re talking about by logic.
You have inflation in the US, right? Right. Sometimes it’s low, sometimes it’s high, but it’s always there, right? Right. 40, 40 years ago, you went to the movies in San Francisco for two bucks. Now it’s 15 bucks. Yeah. 40 years ago, you bought a postage stamp for four cents. Now it’s 72 cents. If you go to Whole Foods and you buy a beautiful, organic avocado, it’s gonna be three bucks.
You know, we know, everybody knows, in 10 years, likely to be six bucks. Right? So far, yet. How is it possible that in this environment, where the price of everything goes up All the time, because the dollar gets eroded by inflation, and you need more and more of them to buy all goods. Someone will be, someone will be insane enough to give you this crazy thing, where your payment and balance will never ever keep up with inflation.
If that were true, it would be the biggest financial gift in the world. Inflation would be your best friend, because it will constantly Erode the real value of your debt, and they’re absolutely right when they find out that we do have this craziness in the United States. The next question is always the same.
Why don’t the Americans drop everything they’re doing and run and get as many of those gifts as they can? Yeah. My answer is always the same. I don’t know, but I sure did. So actually, most Americans that I speak to. Basically, so do you everybody wants to know once I explained like I just did they get the only American that I was being in touch with that got it from the get go is indeed Warren Buffett.
I was in touch with him in 2012 and he got it. He gets it, but he’s already very wealthy and quite a. You know, advancing, you know, age, but I can tell you that 95 percent of all people that I talk to don’t get what it means. And now I can tell you, I can give you one example out of many, many thousands of what it really looks like.
Yeah, one of the things I like about him too, by the way, Warren Buffett is his thought process of how he thinks in compound interest. I remember studying him when I, my, finance days years ago, and he’d be thinking about, and he did the math on. Why he drove his same old car and all these other things.
And he’s like, because he’s making decisions based on his, whatever his expected rate of return is 25 percent or whatever it is for him and his mental game. Right. He’s like, he’s like, I don’t want to spend my math is going to be off on this, but he’s like, I don’t want to spend 1 million on a car. Why?
I don’t need, I’m like, Oh, when he did, when he did all the compound interest of it, I’m like, Oh man, continue. I just had to throw that out. I’m a big Warren Buffett fan, but please continue. Yeah. Yeah. I mean, so, I mean, a, there was an article actually, you know, in entrepreneur magazine a couple of years ago about my interaction with Warren Buffett and how we talked about the 30 year fixed rate loan.
And you’re absolutely right, Adam. Warren Buffett from time to time praises that loan. In the media, but absolutely almost no one else gets it. Now this loan is miracle, which makes inflation become your best friend is only available when you buy one to four residential units in typically duplexes and four plexes, depending on where they’re located are not necessarily located in the best parts of town.
So we talking single family homes, mostly. Unless so single family homes. And so I discovered this a little over 40 years ago and I said, my God, I gotta get as many of those as I could. And I did. Mm-hmm . And, and so pretty soon my, I, you know, I’m a tech guy by background. I used to teach at the university. I was living in Palo Alto in then when I.
Got my first job. They paid me a lot more than Stanford, but I can see it’s not going to get me to a place of strength unless I build, unless I build an empire, so to speak. So I started buying single family homes and pretty soon my friends in Silicon Valley said, We like what you’re doing. Can you help us do?
I never thought about this, but I eventually dropped my high tech life, a company and for my own investments, since, you know, I invest all over the country in places that are growing yet affordable, I had to set up. I had to set up an infrastructure. So in every market where I bought my homes, I interviewed and I yeah.
Made a local property manager that would manage my properties and a local broker that would find me homes. It’s the same now. My investors in the past 40 years or so bought more than 10, 000 homes. Wow. And in about 30 markets. But the principle is the same in every market. Me and my team set up an infrastructure of local property managers, local brokers.
And I’m still our biggest investor. So, you know, I could have been retired, but the message is too strong. So this is what it looks like with a 30 year fixed rate loan. And by the way, the name is slightly misleading. Because you don’t have to wait for 30 years for you to change your life completely. And here is an example.
This is one example out of a thousand. I get a call from one of my investors, and he says, Remember me? I started buying homes with you in my early 40s. I bought just one home to start with because I was very busy. In my job, I didn’t have time to fix toilets. I had to make sure the property managers locally where the home was, we really take care of the heavy lifting.
So I heard your message. She says, I understood about the 30 year fixed rate loan. I put a small down payment to maximize my gifts, my loan, and I bought one home. Then the home rented and became stable and boring as I wanted it to be. So I bought another one. And another one. And another one. Since I had a good job and I was putting very small down payments, the minimum I could, I ended up buying 19 homes.
By the way, it’s not as impressive as it’s not. When he bought the 19 homes, he was buying brand new homes in the suburbs of large metropolitan areas for about 150, 000 back in the day. And putting a small down payment for somebody with a good job, that was not hard. He said, last year I turned 55. I looked at my 19 homes and all of them still had 17 years left on their mortgages, not even halfway of the 30 year term.
But even though I put a very small down payment and my loan started out very high as a percentage of the value of the home, I saw that after 13 years, in this case, my loans were all roughly. A quarter of the value of the home. That’s what inflation does to fix straight loans. Then everything goes up in value, the rent, the shoes, the avocados, the tomatoes, everything except your loan.
So in this case, when he was 55, he says, I see all my loans are just one quarter of the homes. know, the value of the home. Number one, he said, I was super, super happy because I had millions of dollars in equity. Number two, I took four of my 19 homes and I sold them. I didn’t do anything fancy, no tack, no.
No tax deferred exchanges, nothing. I sold four homes and paid my tax. Mm-hmm . And I used the proceeds to pay off the remaining small 15 loans. And now with 15 free and clear homes. I retired for my well paid jobs. Thank you. Thank you, thank you. And he proceeded to say the one sentence that everyone says in the future, everyone, I should have bought more.
Yeah. Everyone says, even I say, and I bought really a lot. Everyone says, I should have bought more. So, so that’s where, this is an example of how the 30 year fixed rate loan basically paid off his loans effectively, close to pay off. In this case, in 13 years, and I found between 12 and 14 years, really, is when your loans are so tiny that you can do stuff like this and you retire, or you send your kids to college, or you become wealthy, or, I mean, some people would say, wow, I can’t buy 90, buy one.
I have people who bought one and say, wow, what a difference it makes in my monthly budget. There’s a lady who bought three, now she’s retired in another country, and the three homes that are free and clear, of course, by now, thanks to inflation too, are the corners to, I mean, it doesn’t, is not enough, buy 60.
I have people who bought 100, it doesn’t matter. It’s a building block. I mean, you’ve been doing this for a long time. I correct me if I’m wrong for decades, for, you know, nearly 40 years. Right. I mean, by now, this is my 41st year. Oh man. That’s amazing. First off. And you’ve helped, I mean, you’re talk about your community, the size of the community, ICG in general, and also like, like what it, what it entails.
So again, this, all, this whole thing started with my own needs. Yeah. So I bought lots and lots of home. I, I never stopped. And then first, because I was in Silicon Valley, started with my Silicon Valley friend and I was helping them mm-hmm . Then they told their friends and many of the Silicon Valley people are from other countries.
So people from other countries wanted to buy. Mm-hmm . And then one, one thing that I love is I like to buy these homes in a. So I don’t just work and have worked with the Silicon Valley people. We work with teachers, nurses, truck drivers that can really change a person’s future. Absolutely. So now when we are in the market and I bought a home and you, bought a home.
And then many investors came and they bought, and so you liked your home, you bought another one, I bought another one, whatever. And let’s say that all together, you know, over 20 years, we gave the local managers more than a thousand homes to manage. It’s very common for us. So now imagine the property manager.
They would be good anyway, but when they know that even one investor who comes in and buy one home, even though it’s their home, the biting, their name belongs only to them. They know that if they’re not happy, they will complain to me. And when I’m not happy. Well, I may move the whole thing to another management company, you know, that can use a thousand homes plus many hundreds we can buy in the future.
So we basically get the clout or the power from large scale. I’m not saying it solves all the problems in the universe. We still like to buy brand new homes in good areas, but it’s good to have this kind of power. Hmm. Yeah, I see that. And you’ve, I mean, tens of thousands of like, well, how many people have been through your programs or like when we work with it in the years?
I mean, if you can, if you could name, cause I know you just been doing this a long time, but you’ve gotten results. I always like to give a difference between people that have been doing this for a long time. People that are just starting. So I like to bring that up. Yeah, well, I’m going to say from the hip design, I’m going to need to, I would say probably a more than 10, 000 homes, maybe close to 11, 000 by now, by an average of about five or 6, 000 people.
I have many people who bought one home. Yeah, three, five, 20, 30, and I bought a couple of hundred. Why do you think you’ve been so successful in this space? . what do you think? Because a lot of people, maybe some people have tried, but like, what do you think made you so successful?
Simplicity, the subject for a poll, today is the unbelievable gift given only in the U S to my knowledge, at least called the 30 year fixed rate loan. It’s basically On the 30 year fixed rate loan, the minute you buy a home, inflation goes to work and it never sleeps, eroding the real value of your debt, and the tenant is paying it off, as they say, in the cliche, but it’s true, and then I simplify it.
We like to buy brand new homes. In the suburbs of large metropolitan areas in the sun built states, because I’ve been a student of the demographics of the US for decades, and it’s clear, even from the census, that the demographic flow goes to the south. So states like Nevada, Arizona, Texas, Oklahoma, Louisiana, Alabama, Georgia, Florida.
I don’t buy in the Midwest, not in the North, affordable cities that are growing and then it’s easy to do and it’s simple. It’s single family homes. We are carrying a huge shortage of homes to live in, in this country, especially since 2008. And so people need the place to live. It’s simple. It’s not that, why did we succeed?
It’s that we kept it simple and we leveraged the. Unbelievable gift called the 30 year fixed rate loan in the face of inflation. Well Adiel, I mean, this has been a lot of fun having you on the show and you’re just a wealth of knowledge. I know that some of our audience are gonna want to follow up and connect.
How do people connect? And also, if you have any events or conferences coming up or anything else like that, websites or whatever else you want to plug, happy to have you share that with our audience. Well, number one, I mean, I was invited nearly a couple of years ago to do a TEDx talk. It’s only 11 and a half minutes, but I explain it there.
You can find it on YouTube. Just put my name, you know, in TEDx. And we have an event once a quarter for nearly the entire of 40 plus years. And I Bring in the market teams to show us their properties and talk about their markets and the economy. I bring experts, lawyers, and CPAs, and I take hundreds of questions and everything.
We used to have a live event, but since COVID we moved it to zoom and we shortened it. And so the next event, the next quarterly event is on March the 1st, which is in a few weeks, everyone’s invited. It’s free. Our website is how you can reach us, which is www dot. I see g r e dot com. And you can register to the event under events.
in addition, by having decided not to retire, I need to find balance in my life. So I make music in my home studio. By the way, you can find that everywhere. Cool. I have a health and wellness podcast actually, out of all things, just as a hobby, but I dedicate more than half my time to meetings and I will meet with any one of your listeners one on one.
I love it. I feel like I’m helping people change their lives and this message of the greatest gift is burning in my bones. I want to show you. Amazing. Adiel, this has been a lot of fun having you on the show. For everybody listening, just so you know, I went to the website, super easy to find the ICGRE. com.
Click on it and then you click on the event section and you can see the current event. You can also see some previous events. So definitely go check that out and connect with Adiel and his team. And speaking of the audience, if this is your first time with Mission Matters and you haven’t done it yet, you Hit that subscribe or follow button.
This is a daily show each and every day. We’re bringing you new content, new ideas, and hopefully new inspiration to help you along the way on your journey as well. So again, hit that subscribe or follow button and idea. Thanks so much for coming on the show. Appreciate you. Thank you so much. It’s been a pleasure.