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When most people hear “inflation,” they think of rising prices, shrinking paychecks, and economic pain. But for smart real estate investors? Inflation is a secret weapon.
On this episode of The Next Level Income Show, I sat down with my good friend Josh Mettle — seasoned real estate investor, mortgage strategist, and entrepreneur. Josh broke down how he’s used inflation, 1031 exchanges, refinancing, and return-on-equity analysis to turn $150K into over $2.5 million.
If you’re serious about building long-term wealth through real estate, keep reading.
💥 Inflation Isn’t the Enemy. It’s the Advantage.
Josh said it best:
“Inflation destroys debt and makes intelligent investors rich.”
Here’s why. Josh shared how his very first 8-plex, purchased in 2000, had rents of $315/month. Today? Those same units rent for $1,800+.
That’s a 500% increase in rental income — while the mortgage stayed the same, or even decreased through refinancing. Meanwhile, inflation reduced the real value of the debt.
When you hold real estate long-term with fixed-rate debt, inflation works for you. It boosts rent income and erodes the real cost of your loan.
🧠 Time in the Market > Timing the Market
Josh’s biggest wins came from one thing: holding high-quality real estate for the long haul.
Over 25 years, he built a portfolio of 176+ units, including apartments, medical office buildings, and industrial flex. Many of these properties were held for decades, with rents increasing steadily while debt service stayed flat.
Even in downturns, positive cash flow is your safety net. If the market dips and your equity shrinks, who cares—as long as the property still prints cash.
“Turns out, if you hold real estate for 25 years, you’re a flipping genius.”
📊 Don’t Just Track ROI — Track ROE
A standout lesson from Josh was the importance of tracking Return on Equity (ROE) — not just return on investment.
Josh had two small buildings (a 7-plex and an 8-plex) with a combined $2.5M in equity, but only earning $5,000/month net.
That’s a 4% return on equity. You could beat that with a Treasury bond.
So what did he do? He sold them using a 1031 exchange and rolled the equity into a $6.3M medical office building, which now generates $19K/month cash flow, plus $53K/year in debt paydown.
“Look at the properties in your portfolio with high equity and low cash flow. That’s where your opportunity lives.”
🔁 1031 Exchange: The Wealth Multiplier
Josh and I both love using 1031 exchanges. Why? Because they let you defer taxes and roll your gains into bigger, better assets.
Josh originally bought those two buildings for under $1M, put around $150K down, and after 20+ years exchanged them into a $6.3M building — tax-free.
The result? Higher income, higher depreciation, and no capital gains tax.
“You either invest in real estate, or you pay taxes. You don’t have to do both.”
📉 Is Now the Time to Invest?
Many investors are waiting for the “perfect” market. But Josh and I agree — you don’t need perfect timing. You need a long-term plan.
Rates have come down from their peak. Sellers are more flexible. Cap rates are adjusting. And value is coming back into the market.
Josh currently has more property under contract now than ever before in his career. I’m seeing the same.
“This is a phenomenal market to make money right now. Sellers are more realistic. There are great deals out there.”
🧠 Key Takeaways
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Inflation helps real estate investors by boosting rent and eroding debt value.
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Hold for the long term and don’t panic over market dips.
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Refinance or 1031 when your return on equity gets too low.
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Use your equity strategically to scale your cash flow.
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Get in the game — perfection is the enemy of progress.
“So many people analyze to the point of paralysis. Just get started.”
🚀 Ready to Level Up?
🎯 Use Josh’s free investment calculator: investmentanalyzer.com
📘 Get a free copy of my book: nextlevelincome.com
💼 Join our coaching community to get help analyzing deals and building your plan.
If you’ve ever wondered how to use inflation to your advantage — or how to turn lazy equity into wealth — this episode is a blueprint.
I hope it gave you the confidence to take action and invest smarter.
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Christopher Larsen is the founder and Managing Partner of Next-Level Income. Since “retiring” after 18 years in the medical device industry he dedicates his time to helping others become financially independent through education and investment opportunities. Chris has been investing in and managing real estate for over 20 years.
While completing his degree in Biomechanical Engineering and M.B.A. in Finance at Virginia Tech, he bought his first single-family rental at age 21. Chris expanded into development, private-lending, buying distressed debt as well as commercial office, and ultimately syndicating multifamily properties. He began syndicating deals in 2016 and has been actively involved in over $500M of real estate acquisitions.
In addition to real estate, Chris has invested in equities, oil & gas, and small business lending, as well as being active in Venture South, one of the nation’s Top 10 Angel Investing groups. Chris lives with his wife and two boys (and Viszla, Lucy!) in Asheville, NC where he loves spending time with them in the outdoors and enjoying the food and culture that the region has to offer.
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