How Real Estate Agents Build Wealth Slowly: Multifamily, Value-Add, and the Long Game

Most agents spend their careers selling the best wealth-building vehicle in America and never buy a piece of it themselves. Stuart Gethner did the opposite. He was a licensed pharmacist in Phoenix — a career that took years of schooling and paid well — and he walked away from it to buy apartment buildings. Today he operates small-to-mid multifamily, teaches 12 online classes for the National Real Estate Investor Association, and sits on the Forbes Real Estate Council.

His message on this week’s REI Agent episode isn’t the one you’ve been sold by late-night infomercials. It’s slower, less glamorous, and far more achievable: returns don’t come from timing the market or predicting rates. They come from what you buy, when you buy it, and how long you hold. This is the episode for any agent who has watched investors buy five properties in a year while their clients buy five in a lifetime, and wondered which side of that table they’d rather be on.

Why Would a Successful Pharmacist Walk Away From His Own Pharmacies?

Stuart grew up in Chicago wanting to play Major League Baseball. When that didn’t pan out, family gravity took over — his father was an optometrist and a pharmacist, his grandfather was a pharmacist, his Uncle Max was a pharmacist. He went to pharmacy school at Wash U, moved to Phoenix to escape the snow, and opened his own independent pharmacies.

The real estate idea came from television. “When I was a kid growing up, they used to have these infomercials on television. Guys like Dave Del Dotto, Carlton Sheets,” he told host Mattias Clymer. “They would say, you can buy real estate and you can surf in Hawaii all day and count your money at night. I was like, that’s for me.” Then, without missing a beat: “I can tell you, it’s not like that.”

That correction frames everything else. Stuart is direct that passive investing is oversold — that real estate is a business, not a hobby, and certainly not a hammock. What pulled him out of pharmacy wasn’t the fantasy but the arithmetic. He bought single-family homes while still filling prescriptions, then a fourplex, then an eightplex, and learned the concept “kind of like the hard way”: economies of scale.

His example is deliberately unglamorous. Buying one water heater is expensive; buying three or four drops the price dramatically. And in an eightplex, when one fails, others are close behind — so you’re buying in bulk anyway. “You actually save money by owning more and having them all under one roof.” That’s the entire thesis of small multifamily. Cross a certain unit count and you can justify an on-site manager instead of being the guy who gets the Sunday phone call. Stuart deliberately targets the tier the big REITs ignore — where independent operators can move faster and build real advantage.

Is Commercial Financing Actually Harder Than a Residential Loan?

Here Stuart pushes back on the fear that keeps most agents out of multifamily. The word “commercial” sounds like a wall. It isn’t.

With a residential loan of four units or fewer, the underwriting is about you. “You fill out the application. They want to see your tax returns. They want to see your W-2s, your savings account. It’s all about you,” Stuart said. “I joke they want to see a urine sample, a stool sample, a blood sample.” Only after you squeeze into that box does the lender bother appraising the property.

At five units or more, the order flips. “It’s no longer about you. It’s going to be about the property. It’s a lot easier to finance,” he explained. “People hear the word commercial. They think it’s going to be much more difficult. Actually, it’s easier to finance because they look at the property first and they look at the rent rolls and the leases and such. Then after that works for them, then they’ll look at you.”

The asset carries the loan. Mattias noted the parallel with DSCR loans now trickling into residential — underwriting that asks one question: does the rent cover the debt? Stuart’s shop doesn’t use them, and he raised an eyebrow at lenders writing DSCR loans below a 1.0 ratio: “I scratch my head and think, weren’t you around about 10, 15 years ago?” Under one means the rent doesn’t cover the debt and the money comes out of your pocket. Reserves aren’t optional.

What Does a Real Value-Add Deal Look Like?

Yes, Stuart runs value-add — and his definition is refreshingly modest. It means buying a property that needs TLC and spending a few bucks to turn it over. His sweet spot is a specific seller: what the industry calls “tired landlords.” “People that have owned 50, 70 properties or so over time, they’ve gotten older. As they’ve gotten older, they haven’t really done the maintenance or the updates or the upgrades that they should. They haven’t raised the rents like they should.”

He’s living the example. At recording, Stuart was buying 17 units in Phoenix from a gentleman in his late 80s who bought them 30 years ago for $8,000 to $12,000 apiece and hasn’t remodeled some in three decades. The rents are low, he said, and the properties aren’t in bad shape — “they’re just antiquated.”

The work is small-ball. “We just won’t do the traditional carpet and paint. We’ll put in the elongated toilets instead of the old round ones and maybe update the cabinets and the countertops. We’ll add value so we can start getting market rents.” No demolition, no architect — just enough to command what the market already pays.

On exit, Stuart cites Stephen Covey’s second habit: begin with the end in mind. He’s done wholesaling and fix-and-flips and concluded that “buy and hold is really where you create the long-term wealth.” Investors who don’t want a 10-year horizon get served through a cash-out refi or a sale. Either way, the plan exists before the offer does.

How Do Cap Rates and Cash-on-Cash Returns Actually Create Wealth?

Stuart’s cap rate explanation is the clearest stretch of the episode, and it starts with what the number is for: comparing a real estate return against everything else competing for the same dollar — crypto, gemstones, stocks, bonds. It assumes no debt. If you paid all cash, what would you earn? That’s apples-to-apples, because you would pay cash for those other asset classes.

“The nice thing about real estate is even though we talk about a cap rate using 100% of our money, we usually don’t use 100% of our money. We usually finance. We use leverage, which makes the investment even more attractive.” His math: $100,000 of stock requires $100,000. $100,000 of real estate might require $10,000 or $20,000.

Realistic cap rates run roughly 5% to 8% by market. “If you can find a 10% cap rate, you start to wonder what’s wrong with the property, or can I buy two of them?” Institutions accept lower caps because they’re parking money securely. “For someone like myself and others who are looking to create wealth, we’re not looking to park money. We’re looking to create wealth.”

On smaller deals he underwrites cash-on-cash instead: how much cash in, how much out in year one? Run properly, “you’d be surprised that you could be in the 20%, 30%, or even higher” — before taxes even enter the picture. On the cheap houses he started with, interest deductions plus depreciation plus cash flow returned more than half his down payment. “Gosh, if it works on something that’s $75,000, it’ll probably work on something that’s $750,000. And all you’re doing is adding a zero.” His most recent raise: roughly $3 million, structured as an LLC with A-shares and B-shares rather than a traditional syndication — B-share members earned a 12% return, with IRR bumping to 20.2% on sale.

The discipline behind all of it comes from a Sam’s Club story about his wife Stephanie insisting on a three-pack of Q-tips they didn’t need, purely because it was on sale. “They were on sale at Sam’s Club, and that’s how we want to buy real estate. We want to buy real estate when it’s on sale.”

How Does an Agent Actually Get Into Their First Deal?

Stuart is blunt about the agent’s structural advantage — and the box that prevents using it. “One of the challenges agents have is that they get stuck in the box of what they’re taught on how to sell real estate and such.” Meanwhile, “the average person who buys a home maybe buys five homes in their lifetime, seven homes in their lifetime, while most investors might buy five or seven properties a year.”

Investor clients are also easier clients. “We really have no emotion, right? I don’t have to have a cherry tree in my front yard.” No school-district anxiety, no bedroom-size negotiation. If the numbers work, they buy.

The entry point is smaller than agents assume. Stuart has watched agents take a $15,000 commission and put $3,000 or $5,000 into a deal. “They may not have tremendous an equity position, but they’re in, and they’re seeing what’s going on with how things are run, how things are being marketed, how they’re being updated.” That’s the point: “The hardest part is really your first deal, getting in.”

Mattias added the argument agents most need to hear — you already understand this asset class. You don’t really understand how the businesses in the S&P 500 make money, but you understand a fourplex. And unlike a 401(k), the cash flow and tax benefits arrive now, not at retirement age.

Why Does an Abundance Mindset Make You Wealthier — and Healthier?

The most human moment is a story about failure. After selling his pharmacies, Stuart circled every For Sale By Owner in the Sunday paper and started dialing. One woman answered. He admitted he was an investor looking for property; she replied that she was an investor too. So he tried the move that always worked in pharmacy: can I take you to lunch? Her answer: “Why would I want to go to lunch with you and teach you what I know? I’ll just have another competitor in the business.”

“And I thought to myself, you can really corner the market on real estate investing? And you can’t. So there’s enough for everybody.” That contrast defined his approach for decades — and it’s why he credits a mentor named Summers, introduced through a patient who wrote Bank on Yourself, with compressing his learning curve: “You never get hit by the bus you see coming. And so someone that’s done it before, they’ve seen the buses.”

Mattias offered the practical counterpart: when you approach a mentor, bring something. Offer to run a top agent’s flyers. Create value first instead of arriving as a burden. Stuart’s own resolution is worth writing down: “In order for me to have more does not mean someone else has to have less.”

He ties health to the same ledger. At Walgreens out of pharmacy school, earning a weekend off meant working Friday noon to close, a 12-hour Saturday, an 8- or 10-hour Sunday, and Monday until noon. Now he plays pickleball three times a week and still hits the gym — and credits the portfolio for it. “As long as I have my laptop, I can be here at my office or I can be in the Bahamas.” Enough income to replace a job doesn’t just buy money. It buys the schedule.

The Golden Nugget: Get Rich Slow

Asked for takeaways, Stuart quoted Henry Ford — “if you think you can’t, you’re right. If you think you can, you’re right” — then landed the line that captures the whole conversation:

“This isn’t get rich quick. It’s just not. But it is get rich slow. So if we’re willing to put in the time and do the due diligence and follow the plan, it’s not hard.” — Stuart Gethner

The rest follows. You make your money when you buy — “you don’t want to bet in the come. Oh, the market’s going to go up. Oh, interest rates are going to go down.” You can’t control inflation or rates. You can control how, what, and when you buy. Find a great deal: “There’s a lot of good deals out there. I want you to find a great deal.” And “I ain’t got no money” is an excuse, because capital finds great deals through partnerships and joint ventures where everybody wins.

His book picks: The Adventures of a Reluctant Messiah (a mindset book, not a religious one), The Four Agreements, and Let Them by Mel Robbins, a gift from his daughter. Find him at StuartGethner.com — and true to the abundance theme: “I bet if you called, I bet I would probably answer the phone.”

The full conversation goes deeper on financing mechanics, deal structure, and the mindset shifts that separate agents who sell wealth from agents who own it. Listen wherever you get your podcasts, and subscribe so you don’t miss next week’s guest.

Ready to go further than an episode? REI Agent Advisor is built for exactly the agent Stuart describes — the one who knows real estate is the vehicle but wants a plan instead of a guess. And at REIAgent.com you can sign up for the weekly newsletter summarizing each week’s guests.

Because as Stuart heard once and never forgot: there were two great times to invest in real estate. The first was 20 years ago. The second is today.

All content in this show is not investment advice or mental health therapy. It is intended for entertainment purposes only.

Full transcript: read the complete episode transcript on the episode page.