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Mechanic using tablet on car
A guy pulls into an auto repair shop.  He is frantic because his car door will not shut and he is late for work. He tells the mechanic that he needs to get to work and cannot drive because his door will not shut.  The mechanic looks at it and says that he can fix it quick and it will be $100.  The guy agrees.  The mechanic goes into his shop, picks up a hammer, and goes to the car.  After looking at it for about a minute, he carefully takes his hammer and hits one small specific area – like magic, the door opens and shuts perfectly!  The mechanic says that the charge is $100 and the guy is pissed.  It only took a minute and one swing of the hammer, how could he charge $100.  The mechanic replied that the labor was only $5, but knowing where to…
rant
There are lessons to be learned from new situations that arise. This just happened and I am pissed off!  It is a cautionary tale which I hope you can learn from.      The normal process works this way… Julian and I find every property for sale in the area – this requires contact with every broker in the area at least every week.  Julian pulls rent comps, analyzes the rent roll and financials, then utilizes my Quick Analysis from to give the first glance at a property for sale – this process takes 1-2 hours per property.  I review the information and numbers – another 30 minutes.  We then contact the broker, ask more questions, and refine the numbers again.  Our next step is to arrange a property tour on the property – again to verify our numbers and further refine our business plan for the investment.  This includes…
income-properties
If we use the definition of an asset by Robert Kiyosaki in his book Rich Dad, Poor Dad, an asset is something that makes you money.  Conversely, a liability is something that costs you money.  Therefore, an investment in a real estate asset is something that makes you money. If you are buying something that makes you money, how do you come up with a price you are willing to pay for that investment?    In today’s current state of the market, prices are going up very fast.  Why? In my opinion a few different forces are at work.  Our real estate market crashed in 2008.  This caused most people to distrust many investments, including real estate.  The resulting crash also wiped out many individuals’ savings and any equity they may have in their real estate assets.  The government and the Fed created a stimulus by injecting billions of dollars into the…
real-estate-syndication
Syndication is a way for people to pool their financial and intellectual resources together to purchase properties much bigger than they could afford or manage on their own. The person who puts together a group to purchase a property is called a Syndicator, Promoter, or Lead Investor.  The syndicator usually brings the intellectual resources needed to identify, analyze, contract for, inspect, finance, fund, close, manage, refinance, and dispose of a property in a manner that provides a financial return to his investor/partners.  The investor/partners leverage their financial resources into the transactions as passive investors while continuing their current occupation. This creates a symbiotic relationship, as well as a fiduciary responsibility to each other.  The syndicator is the responsible party that actively manages the project.  The syndicator uses his market knowledge and experience to create value for his investor/partners by increasing the value of the property and provide cash flow. The…
Handing Over the Keys
The title may sound counterintuitive. However, as real estate investors we invest, we do NOT speculate. We know when we go into a transaction what the business plan is, what we will spend, and what value we will be creating.  Real estate is a beautiful tool for being able to accomplish that task – probably one of the only investments that has that ability.     You make money when you buy real estate, and you capture that profit when you sell. It is similar to finding that antique worth thousands that you find at a garage sale for hundreds. You know you will make money on it, therefore, you must buy it. You now have an asset worth much more than you paid for it. You then capture the profit when you sell it!     Real estate is a little more involved, which is where the business plan…
love-real-estate-blog-header
I Love Real Estate! There are so many things to love about real estate and real estate investing. One acronym used to describe the benefits of real estate is that it is the I.D.E.A.L. Investment. Your receive Income. You get the benefits of Depreciation which lowers your tax bill. You create and grow Equity by purchasing below market value, and/or increasing market value, and in paying down loan principal. Property values Appreciate. You can utilize Leverage. While each of these benefits is compelling, there are numerous other benefits that – in my mind – make real estate the ideal investment. A few of my favorites include: Creativity – you can be creative in the use, design, or investment. Some examples include… updating an old warehouse into cool lofts, converting unused spaces into amenities or even additional rentable space, or even structuring deals to meet different investment goals. It is tangible.…

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