Category: Blog

How to Travel and NOT Be Broke

https://youtu.be/lFg9ohH6EZ4

Just by leveraging the loyalty programs that are set by credit card companies or airline companies or hotel companies try to rent them out and for anybody who’s not familiar with travel hacking at all, it’s a way that you can get free travel or a lot of cashback if you want. Just by leveraging the loyalty programs that are set by credit card companies or airline companies or hotel companies. And if you’re not aware, there are dozens of different credit card options and different loyalty programs out there.

And it’s all about how to strategically approach the game so that you can meet the travel goals that you want. You can get the travel that you want for almost free, very close to next to no cost while just learning to play the game and plan strategically. Which I think a lot of people in your audience obviously do as they’re researching different real estate and different passive income opportunities.

Yeah and I think that people listening, they’re like myself optimizers and this whole travel hacking thing, you’re literally collecting points and then you have to figure out where that cash in those points at the highest value. It’s like a video game! It really is addicting. It can be a time suck. Maybe let’s start off with do you have a list here of some highest or biggest bang for your buck type of tactics? What’s at the top of your list?

It’s not just a game for how to use the points, but also even how to bring in those points and so my number one advice to people is I have a few. The first is the best travel hack is finding friends who can show you even more travel hacks, because so many people do it the very unoptimized way of I’m going to watch 14 hours of YouTube videos and read blogs.

But really if you just join a community, whether it’s on Instagram or a Facebook group or something, I host different Hangouts. If you just find somebody who’s already into this kind of thing, like you went to the frequent traveler university conference.

It speeds it up so much. If you can just ask your questions there. Secondly, if you’re like, I really just don’t want to interact with people. How do I do this quickly on my own? My advice is to work backwards. So some people will make the mistake of researching different cards and saying, I’m going to go get a Chase card and then an Amex card, and then a Citi card, a Hilton card, a Marriott card or United card.

And then I’m going to figure out what to do with all of those and that’s a really inefficient way to go about it. Instead, I would recommend start with the goal that you have in mind for free travel and work backwards from there. If you’re telling yourself, okay, I want a free trip to New York city and I currently live in Hawaii.

Here are the airlines that fly from Hawaii to New York city. I want to stay in this area of Manhattan. Here are the different hotels that are servicing in that area. Here’s how many points I would need to get that free flight and to get however many nights in the hotel for free. And then here are the credit cards that can earn me kinds of points that can actually be transferred correctly to that airline or that hotel.

Then it really narrows down how many things you actually have to research and figure out and how many points you need to get in the exact currency that you needed in, rather than just shooting all over the place in the dark. Makes some travel hacking friends and also work backwards to get to your goal faster.

This website offers very general information concerning real estate for investment purposes, every investor situation. Always seek the services of licensed third party appraisers inspectors, to verify the value and condition of any property you intend to purchase. Use the services of professional title and escrow companies and licensed tax investment and or legal advisor before relying on any information contained here in information does not guarantee as in every investment there is.

The content found here is just my opinion and things change. And I reserve the right to change my mind above all else. Do your own analysis and think for yourself because in the end, you’re the only person who is going to look out for your best in.

For Beginners: Get To Know Your Credit Cards

https://youtu.be/uv2iOi6T4N8

Who are in this hobby are really frugal and they’re just like savers by nature. And they don’t like to go out and spend the points, but it’s not like money. You don’t save these points until retirement or something. You want to earn the points, know how you’re going to use them and then know how to get more points.

try to rent them out and

If you are a very beginner, like this is the first you’ve ever heard about this, the most popular beginner card these days is the Chase Sapphire Preferred and as ofyesterday or two days ago, March 21st, they just increase the sign up bonus to 80,000 points instead of 60,000 points that’s worth more than a thousand dollars in travel credit.

So Chase Sapphire Preferred is one of the most popular ones for beginners these days. We always recommend start with your Chase cards instead of starting with American express or another family like that, because of something called the5/24 rule, which says that if you have already opened five or more accounts with any carriers in the last five years, Chase’s just gonna reject you if you apply with the chase card. So it’s good to get the chase cards out of the way first.

And then you can move on to American express that doesn’t have this rule. You can move on to Citi cards, bank of America something else like that.

Good advice. I have a love & hate relationship with Chase . I do the tradeline hacking thing where I kind of piggyback authorized users of my cards. People want to learn more about it. Go to my simplepassivecashflow.com/trade and I had a little e-course on that. But chase cancel all my cards. So I’m not in the phenomenal rewards, credit cards. Great place to start there.

Why did they cut off all of your lines, too many authorized users?

Yeah, it was getting a little ridiculous. I was turning people a lot quicker than I do these days and I have flagged on about it. It’s good that you see a company actually has checks, so it make sure that there’s no weird activity such as mine so I think it’s good business. It sucks for me , but I applaud Chase for doing it,shows that they have their S together.

How many points did you lose when they shut you down?

I think at the time, I think I lost myself west point 200,000 points. Goes to show, right? Savers are losers, just like people with all this equity in their house or the bank.

There is a strategy called churn and burn where earn and burn where you’re earning points really quickly and then you want to use them quickly as well. You don’t just want a whole bunch of points sitting there in your account not being used because a lot of airlines will de-value their awards programs. And so if you just have hundreds of thousands of points sitting there and you’re thinking, okay, it’s like around the world trip or something is going to cost 200,000 points and then the next year they’re like, oh, now it cost 250,000 points. And your points were just sitting there and never used.

This website offers very general information concerning real estate for investment purposes. Every investor situation is unique. Always seek the services of licensed third party appraisers inspectors to verify the value and condition of any property you intend to purchase. Use the services of professional title and escrow companies and licensed tax investment and or legal advisor before relying on any information contained here in information is not guarantee as in every investment there is.

The content found here is just my opinion and things change. And I reserve the right to change my mind above all else. Do your own analysis and think for yourself because in the end, you’re the only person who is going to look out for your best in.

BIG MISTAKE in Managing Real Estate Property

https://youtu.be/3tRnTjDXY2s

What are any lessons learned to open up the spending money stuff? Because I think you’re a big inspiration and building your portfolio but I think people here they’re already doing that. They know it works but how do you take it and get from scarcity to abundance mindset.

Yeah. I think part of it is there’s two ways to go about something. You can try to figure something out on your own, and certainly you can do it. There’s a lot of free resources out there but you’re probably gonna make costly mistakes. It’s going to take you a lot longer. And this is a lesson I’ve had to learn. There is such a thing as being too cheap and too frugal. And if you’re not willing to invest in yourself or invest in a way that can help you grow and get ahead or just invest in the right things and not be cheap, then you’re really going to be holding yourself back.

A perfect example of this is when I first wanted to hire a property manager. I was trying to look for ways that I could do it frugally and not give up so much of our rent money. And we had these two people that have been working for us really hard workers. They did a lot of the cleaning and the maintenance at our properties.

They seemed really intelligent, always went above and beyond, and we decided to hire them as employees of our company and train them on how to be our property managers. Everything started out great but then six months in my husband went to the rentals to collect rent one day from the lockboxes. And he realized there was a lot missing and it wasn’t just the normal tenant paying late.

It was a significant amount. So we come to find out that the property managers stole $6,000 in rent that month and run away. We still don’t know where they are to this day. And we found out they’d been squatting in vacant rooms and units in our properties for almost a year. That was awful like such a violation of trust.

The huge moral of the story is there are certain places where you don’t be cheap. It doesn’t make sense to cut corners because being cheap can end up costing you a lot more in the long run. And we definitely should have hired a reputable, licensed, bonded insured property management company and then that wouldn’t have happened.

Yeah. I call it CFE cheap easy free. Anytime you try and do that, you get burn. And I started to adopt this maybe four years ago, maybe I think five or six years I was doing. I had a dozen rentals at lease. I don’t know what the hell I was doing, but like I was doing the dog sitting thing. I was watching other people’s dogs because I like dog.

But this one dog attacked me and I was like, what the hell am I trying to do? Trying to make a few hundred bucks every other week. And I have this scar on my leg that helped me understand that yeah,don’t be cheap, easy and free. And also, I think you’re seeing like the syndication world, like a lot of this building networks or other peer passive accredited investors. Accredited investors can smell cheapos from a mile away. They know for sure.

For sure. I think a big difference between non-accredited and accredited investors is that there’s different goals. I think when you’re first starting out, you don’t have any money, but you do have more time and you’re willing to hustle and work harder and maybe self-manage and do things that you wouldn’t be willing to do later.

But then when you get further into your realistic, investment journey it flips the other way. Where suddenly you have a lot more money and you don’t have a lot of time. That’s why we’re actually selling some of our rental properties right now and transitioning all of that money into syndications because I’m sick of dealing with him.

I’m sick of the liability. I’m sick of having tenants. I would rather make a little bit less money. You still make great money in syndications. I’d rather make a little bit less money and literally not have to do a thing. What we found is that investing in syndications aligns so much better with our passive income goals.

Another thing that accredited investors realize is relationships are the currency of the wealthy, but the right relationships with also abundance mindset at people and if you want to call it accredited investors too. Non accredited investors, not saying they’re bad people, but they just don’t have money and they run on a different operating system.

Yeah, and I used to be one and I totally see now how my mindset has changed over time. And it’s really fascinating. I just had different values and goals then, and definitely was more in this scarcity mindset. Now I’ve totally flipped in the opposite direction, but surroundingyourself with people you’re absolutely right.

Is the most important thing. And that’s another thing I’ve had to be okay with investing in is especially with growing my business with my books and my courses. I definitely hit a wall because I’ve been trying to figure it out all on my own. I was like, what do I do now? And I ended up investing into a mastermind that really helped me strategize and be clear on where to go.

In my opinion, I want to be the dumbest person in the room. I want to surround myself with people who are already five or 10 steps ahead of me so that I can mimic everything that they’re doing.

December 2021 Monthly Market Update

https://youtu.be/JHE1Mpe408Y

It’s December, 2021. Welcome everybody. This is the monthly market update. Here we go!

Easter eggs for you guys starting out. If you guys are checking this on the podcasts go on over to simplepassivecashflow .com/ 2022 retreat. The retreat is on, in-person not virtual like we’ve done last year, but in-person in Waikiki. Check us out the full itinerary, January 14th to the 17th. Again, simplepassivecashflow.com/2022 retreat.

 

If you guys are tired of kicking tires of the bunch of broke guys at the local real estate club or the free online forms out there, you got to check out our group. Everyone’s vetted before they come. This is not going to be a bunch of randos meeting up in Hawaii. Only people who are coming are people I know and it’s a good group of folks we have about 75 people signed up nearing the head count, soon. You checking this out on the YouTube channel. We’ve got a lot of different slides and graphics going to be going through a bunch of articles and I’m an engineer so I like charts.

A bit of my background. I’m no longer an engineer, no longer doing the project engineer stuff bought my first rental in 2009 and over 6,000 units now. We just closed the deal on Phoenix yesterday. I think 6 or 7,000 units at this point. If you guys haven’t heard of me before, check out simplepassivecashflow.com, which is my blog and check out the simple passive cashflow podcast on iTunes, Google play.

And if you guys are listening to this live, feel free to drop a comment below or question we’ll try and get to it as we go along. All right so first teaching point here, inflation is upon us if you haven’t noticed. All these things going up beef 24%, gasoline 51% hotels and motels all the stuff for the rich folks, right?

Because if rich folks aren’t really impacted by the old recession call it what you want. To me it’s a little sad. But again, it’s the rich get rich and the poor getting poorer. A lot of these energy commodity is going up for 49%, used cars and trucks going up 26%. I just sold a car. Sold my car a couple of weeks ago, I bought it for 53,000.

I sold it for 60. Used cars going up and it’s hard to get a hold of new cars. Here’s another graphic here showing some of the increases in poultry on the slide is what was up 44% since two years ago, fruits and vegetables up 18%. Inflation is coming to get you. Maybe it’s only going to get your mom and dad who are just sitting on their home equity, paid off houses.

That’s the people that it’s coming after, or the poor people, who don’t buy assets and the reason why you want to buy assets is because it goes up with the pace of inflation. In my opinion, you don’t want to buy gold because it doesn’t really do much does, has no utility and it doesn’t cashflow make income.

It said buy real estate, which is the best of both worlds, goes up with the pace of inflation and it produces cashflow. All right so let’s get into it. Some of the reports here, Blackstone the big company that we’d like to follow because they’re the people who are smart with money they just bought Bloomberg entertainment for about $3 billion.

Now, if you haven’t been noticing, Netflix kind of started with the streaming service, but apple TV, disney plus all these streaming services where you control the channel and you control your audience essentially control your platform, right? Facebook did. Now, Amazon is doing with ads.

If you control where people go, you can somehow monetize it today. Gone are the days of NBC, Fox, CBS, and channels and you want to control the media channel or in terms of streaming services and, Blackstone sees playing that said Moonbug entertainment. This is one of those news where it just like sucks for the small guy, because folks like us, we’re not able to play at these types of institutional assets.

We like to play in apartments, which is somewhat attainable to the average million dollar $5 million Joab. But it’s not like y’all can buy an entertainment company, but just for food for thought here. CVS health plans to close 900 stores and focus more on their digital strategy.

I think we’ve talked about this on earlier investor reports, which you can get all the past investor reports go to simplepassivecashflow.com/investorletter. We’ve been talking about how Amazon was trying to get into the pharmacy business. CVS has a stranglehold on there but as business think of Kodak or MP3s, if you don’t change your business, you’ll get steamrolled.

And CVS is closing brick and mortar stores to focus more on their digital strategy. ULI forecasts the transaction volumes posed to bounce back to pre pandemic levels. US GDP strength 3.4% in 2020 as expected the first economic contraction since 2009. Recovery from the pandemic is expected to occur dramatically faster than what transpired following the great recession of 2008 according to Washington DC group. You guys are probably thinking captain obvious, but they’re expecting a bounce-back and growth of 5.7% expected at 2021 with the continued growth of 4% in 2022.

The outlook is optimistic for most sectors of commercial real estate. The hospitality industry is still showing signs of struggle. Hotel revenue per available room, which we call is RevPAR saw one of the starkest numbers in ULI’s presentation following a 47.4% decline. RE business online reports the American Liberty hospitality opens a 300 room dual branded hotel in Houston.

So the bite we just mentioned with some hospitality, struggling big companies are opening up these hotels 64 Alameda road, that’s supposed to be a combined Hilton garden Inn and a hotel, two suites by Hilton, 300 room.

Now there’s a reliability of small multifamily tenant base fuels recovery from Arbor, which is a big commercial lender so we have a lot of good neutral information. Sometimes you got the news from multifamily housing news, which is more of a pro industry type of news, where the lenders, they show things how it is for the most part.

But they’re showing here how the year-over-year change been leveled off since 2014, which is consistent. However, the origination VAT value, a year of your change has been going up and up steadily. Analysis of work from home trends finds that small multi family properties may be less affected than larger properties because fewer tenants can work remotely.

Smaller multi-family cap rates filled at 5.2% in the third quarter effect the unchanged for the last quarter. Asset prices rose 2.9% from a year earlier at 7.7% over the pre endemic levels. One complaint I hear a lot the cap rates are compressing. Yeah man, that’s been happening since 2008 and it’ll continue to do that.

But the whole point as an investor is you’re doing value add, and you’re making money off of the spread between the cap rates and interest rates and as cap rates go up, so as interest rates go up. Sophisticated investors don’t really care because again, they make money off of the Delta and they value add to transcend what’s happening in the market.

 

Yardi Matrix reports that gateway markets rebound and when we’re talking about gateway markets, we’re talking about those California markets got a beat down at the recession. Demand for rentals of the United States has been extraordinary this year. With over half a million apartments being absorbed, which already topples 2018 single year high of 370,000.

So over a hundred thousand units than the last previous high, which makes sense. 2020 was a year of a lot of traction projects, halted projects that were just completed, might have been paused to lease up and everybody just stayed in place, but now you’re seeing a lot of this train slack come back. Moving on to the more residential side article for Redfin saying home sale prices up 13% from 2020 they’re outlaying 2019, 2020, 2021 on this nice little graph.

It takes up the seasonality of the thing. The thing that you could see, especially at 2021 is after February, March, April, when the vaccine started to roll up, you really started to see that built up demand come through. Median home price increased 13%. Like I said, this is up 30% from the same period in 2019, two years ago, asking prices on newly listed homes are up 11% and on average, 4.9% of homes for each week had a price drop.

Now, this is coming from a real page, going back to the commercial apartments, luxury apartment rents premiums going up once again. So this answers the question what’s better with class A, B or C. If you look at the graph, class C rents have been very slow linear growth or class B and A rents

you’ve seen a nice little tick up the last half of the year. The difference in effective rents between the two products segments went up just over $300 in 2010 to a whopping $500 in 2020. So that gap is growing as it should. It’s you know, this is if you’re always going to have higher rents, classA, B to C that makes sense that gap is going to be growing.

The difference in rent then slipped by just under $400 by the end of 2020, but steady pricing power in the most upscale properties in 2021 as push a difference back to $449. The class C average rent price is 1189 now $358 under the class B. Again, this goes back to the unfortunate reality, which is the class A renters and class A folks are typically peachy in the aftermath of the recession, or it’s a class C people that have the most difficulty paying rents.

I would probably extrapolate at class A people can work from home, class C people are more of the service sector. Maybe they had shut down, some close business sectors.

Rent still rising but growth slowed significantly from apartment lists. The slightly significant slowdown rent growth has continued to exceed its pre pandemic trend. To make more clear. The chart below thoughts are national median rent estimate against a projection of pre pandemic. The national rent rose to 1312 this month, which is $107 greater where we projected it would be if the rent growth over the last year and half had been in line with the growth rates, we saw 2018, 2019.

I think we can safely say that I wouldn’t say it’s slowing down, whereas it’s going backwards. Look at some of these rents going up, I go back a couple slides. The rents are just going up too high for a short period of time. It’s cooling off now a little bit, but it’s definitely not declining.

Here’s a chart of 10 of the top rent growth market. Tampa, Florida, Gilbert, Arizona, Glendale, Arizona, Mesa, Arizona, Chandler, Arizona, and all those four Phoenix right there. Boise, Idaho, Henderson, Nevada, which is Las Vegas, north Las Vegas, Nevada, and St. Petersburg, Florida. All those 10 have gone up 32% to 36% since March of 2020.

Absolutely crazy. Normally, when you’re doing your normal conservative projections, you’re assuming that the rents are going to go up to 4 or 5% at extreme levels in the past since March of 2020 you’re talking 30%. That’s pretty crazy. The markets remain extremely tight.

We’re now seeing the first signals that pressure is beginning to ease.

It’s also important to know that 35 of the nation’s hundred largest cities have seen rents jumps by more than 20% since the start of the pandemic. Even if the rent is finally cooling, this year’s rent boom has already added significant housing affordability for American renters. But hey, they’re just pumping in a whole bunch of fake money in anyway with all these stimulus plans.

What is the buy back America or infrastructure 1, 2, 3, 4, 5? Rent data tech cities are back in the country’s major tech centers. Rents are making up for lost time with record growth. Again, the same thing we talked about, the last one. This is from realtor.com. This one’s looking at more from a national taking into account all markets. They’re putting a retro thing from 11 to 13% year over year.

And what they say is the rise of remote work filled this migration continued declining for rental housing i n urban areas, particularly in heavy tech markets like San Francisco and New York. However, the rising vaccination rates of many major company signaling a returned the office, the demand for urban housing has been recovering quickly in just the past two months.

Rent growth has surge in tech centers around the country. I’ve had a lot of investor calls from you guys lately and one of the sentiments I’ve been hearing is ” dammit, they’re making me come back to work screw that. I quit!” Just kidding, you guys get paid too much because they’re going to just suck it up and it worked for a few more years more, but yeah, it’s tough to take back that freedom when you’ve been given it that long.

Just reading, going down this list. We won’t go down that list, not that important. Inclusion and incentives zone in 6 New England States. We’ve talked about in the past, how you’ve got zoning restriction and tax restrictions in California. You’re starting to see some of this in the new England states where they’re breaking down the not in my backyard type of restrictions, where there’s so much pressure in all these markets for cheaper housing, more affordable housing for regular people, not just rich people.

Where they’re bringing people to live in those types of areas where more the old school mentality, the last 20 or so years, 10 years was they try and segregate people and rich people. Obviously that creates a bunch of projects for the bad areas. Maybe if you’re a rich out there, you probably liked it.

Cause you don’t want poor people nearby. If you’re trying to run a city or a nation in m y opinion it’s not the best thing. You need a little bit of mix. So you don’t have all these Banana Republics and these ghettos all around the place. But whatever, I don’t care. I spend my time not on politics but investments that will make me money and folks like yourselves. But this is just one article showing that how this stuff is popping up so something to be aware of.

Pricewater Cooper. They came up with a report where they mentioned climate change is hitting the property sector where they surveyed a bunch of folks, the top cities: Nashville, Raleigh, Phoenix, Austin, Tampa, Charlotte, Dallas, or Atlanta, Seattle, Boston are kind of places people are moving to they say.

The impact from the pandemic was less than the real estate industry expected at this point last year. Now that the industry should use its good fortune towards both preparations and continued uncertainty and making strides towards ESG improvements.

Yeah. Sometimes you’ve got to scratch your head on that, those high-end accountant’s reports. Especially if you’re investing in workforce housing, you sometimes you got to take that stuff with a grain of salt. That said, here from glowbest.com, why invest in lower middle class housing to hint is that the hedge in case of a recession, but also to capitalize a current momentum. Now, in most recessions everybody’s impacted the rich people are impacted. They lose their jobs. They moved down to the Bs. They move down to Bs and Cs different thing that happened in this pandemic where the A’s are pretty much unimpacted, the Bs and Cs are more impacted. I still believe that in most cases and economic recession, I think it’s prudent to not stay with the luxury type of stuff.

For the majority or your portfolio so they’re saying here, despite the uncertainty within the market class C properties are being taught as the best position property for an economic slowdown by experts in the market during a panel discussion at the national globe street multi-family conference here in Los Angeles. Panels discuss the gap between rent rates for A and class C properties and viewed some of the current trends within class C properties.

ATTOM reports that seller profits increase across US in third quarter as national median home prices reached another record.

Worldpropertyjournal.com reports 30% of us markets to experience double digit rent increases in 2022. Again, a lot of what we said here, just a little bit different graphs. If you guys check this up on YouTube channel. That way, you know I’m not making this stuff up. It’s multiple people saying the same thing.

12 month absorption of apartments. The top are Dallas Fortworth, Houston, New York, Los Angeles, Washington, DC, Atlanta, Chicago, Austin, Seattle, Phoenix.

Dallas business journal reports that rents in Dallas-Fort rocket 15.5% in a year, even with the increases, Dallas is still more affordable than most comparable cities across the country. And like Dallas, many US cities shall start increases. Phoenix was up 27% year over year in September, New York rolls 18.3% and Nashville jumped 17.5%.

And just to speak about a real world example, comparing Phoenix and Dallas. Phoenix, you’re buying maybe class B assets for about 200,000 to mid $250,000 call it that. For the same price, you’re buying more A-class assets in Dallas. Maybe it’s just too many Californians moving to Phoenix.

They needed more to Texas Dallas, but that’s where the pricing is. If you want to buy a class C property in Hawaii, you’ll probably pay 300 to $350,000. And that is Investing 101. Does that make sense for that income stream?

REBUSINESS online reports, demographic economic trends, like they sustain build for rent sectors for growth. A lot of people it’s going to be coming more of our renters nation and it doesn’t make sense to do build for rent. I’m not a huge fan of it. I like more mature neighborhoods. I don’t like all these like new houses all in one area because when a recession comes, that’s the first place where the water retreats from.

I think we saw it a lot in the great recession. If you can remember that old movie, The Big Short, the big tracks of homes in Florida, right? Like the build to rent type of stuff makes sense in theory, just like hotels do. But in recessions, I don’t feel like, I’m not super comfortable doing that type of stuff.

National multifamily housing council reports, how will President Biden build back better framework impact the multifamily industry? They’re saying the plan is to offset by tax increases on corporations, wealthy American. Including changes to like kind exchanges increases the ordinary income taxes at general 20% capital gains tax rate that carry interests for sponsors, 20% pass-through deduction and taxation unrealized capital gains at decks.

A lot of these things didn’t come through permission. They didn’t touch them. Everybody got up in arms about changing the self-directed IRAs but a lot of it didn’t really change. We got to see how it goes through the Senate at this point but maybe it’s on a chopping block later.

At this point in time nothing super huge in my opinion. We keep it simple. You don’t care about stuff. You invest good stuff that cashflows grows your money and gives you like passive activity losses to lower your passive income, that’s what you got to do. That’s the low hanging fruit right there.

And then you don’t have a high income. The only people having high incomes are people still working their active jobs and that’s what you got to try and get away from.

Also expanding on how the $1.2 trillion infrastructure bill impacts multi-family. The infrastructure bill will repair and upgrade the nation’s roads, bridges, mass transit, high speed rail broadband, power grid, water pipes, electrical vehicle charging stations on for critical infrastructure. We have a breakdown on the YouTube channel here of all of this. But to me, it’s just basically a way to just dump a whole bunch of money into the system, paying ourselves basically.

Commercial property executive identifies three trending demands in commercial real estate, which is the evolving hybrid workplace, post pandemic office. We don’t know exactly how that’s going to be, but definitely we’re not going to be going back to the office a hundred percent as Adam and Eve had eaten the apple and have proven that they can eat the apple and work from home, potentially.

I am still a doubter, I think, especially in the coastal areas where you have a lot of tech markets and more independent white collar workers, I definitely do think that they can handle themselves and manage themselves appropriately where your sub hundred pay workers. I still think they got to get to the office and be managed and supervised.

Another trend is supporting employee wellbeing, being thoughtful design real estate can incentivize employees to return to the office. So what you’re seeing the new builds or the office stuff is a bunch of other services that attracts people to them. The incentive to get on the bus, get on the train, get in your car, to come to work for the socialization, other facilities and the demand for warehouse continues to increase.

Commercial real estate applauds $1.5 trillion infrastructure plan. The big thing here is infrastructure and housing are intrinsically linked and this is our president investment in our nation and will help lift communities industries throughout the nations. The president of the NAA and CEO.

Four ways Phoenix benefits from the infrastructure bill, climate protections, the infrastructure investment jobs act will accelerate Phoenix efforts to complete transportation projects along with many of the city infrastructure priorities. These projects will call to create high paying jobs and connect with more families with economic opportunities. Transit south central extension and downtown hub will connect with the current light rail system in downtown Phoenix and operates south. Roads Phoenix adopted the ‘co-payments system which will apply reflective coating to the neighborhood streets, the lower the extreme surface temperatures around the city.

Other initiatives include cool corridors, which is the plant and Jade trees into the neighborhood and along with city streets. And jobs, the nation’s growth is set to increase 0.4% compared to Arizona, which is showcasing it analyzed growth of 1.6%, about three times, at least three times more.

And the other thing I’m personally following, not on this list is a TSMC and Intel building a whole bunch of apps to make all the chips that are in shortage. We don’t want Taiwan to make all the chips because those Chinese guys are always flying airplanes around their space or supposedly near their space. Not violating any international laws of course, I think what 80% or so of all the smart ships, the really good ones, not the dumb ones that go in your kids toys, but the smart ones that go on your iPhone pros are made at Taiwan and the ideas that want to repatronize some of that back to American. Places it’s going is Phoenix.

Inflation’s influence on multi-family home buyers this is from multi-housing news. Higher spending rising energy prices reduced rising housing prices, low inventory across multiple inputs.

Higher wages need to be kept and filling employee shortage, shipping delays, and other factors are issues we face today. Despite all that effective breath growth growing 11.2% nationally in 2021 quarter 3 so cheers to all the landlords. Boo, to all the tenants up there, they don’t like that. You don’t want to pay more rent, they want it for free.

ATTOM they report the U S foreclosure activity continues to increase nationwide. Now this kind of makes sense. After all of the rent moratoriums going away or the foreclosure moratoriums going away nationwide one in every 6,600 units. States with the highest foreclosure rates are Illinois, then Florida, New Jersey, Nevada and Ohio among the 220 MSA out there.

Those with the highest foreclosure rates in October, 2021 were St. Louis, Missouri, Trenton, New Jersey, Miami, Florida, Chicago, Illinois, and Cleveland Ohio.

How the pandemic has impacted the movie theater property values. The cinemas emerge far behind the pack of other businesses in a race to resume normal operations. Cinemas were already difficult to value because they’re unique. A uni Tasker, right? This big building, the only people who want to buy that building was Toys R Us and they went out of business. Just joking there, but it might be true.

And the lack of comparable transaction data across the country makes it hard so the ticket sales give appraisers and taxes are the big hurdle in valuing these movie theaters. So if you guys think of a good idea, what to do with these big movie theaters, other than that Toys R Us, let us know.

Join the Facebook group, join the community, create a discussion, or just buy rental properties and afar the other day. Because a lot of these other ideas that I bring up like industrial storage, buying movie theaters what’s the other one big office complex it’s out of the reach of the average Joe under $5 million. A lot of this is institutional type of money that has access to it.

Dallas business journal reports at San Francisco and Los Angeles among regions, losing workers to Dallas-Fort Worth. San Francisco bay area took the number four spot last week. Last month, the region wasn’t even in a top 10 prior to the pandemic.

The numbers were another sign of a growing number of companies and workers moving their home bases from places such as California and New York, to Texas. Lower costs and taxes for businesses, as well as those that employ are driving the shifts. One thing I would mention, like the people will talk about like taxes.

Just because a state has no income tax , like Texas doesn’t mean that’s a good place to invest guys. Like that’s say I don’t know. That’s just not a good way to invest because yeah, sure. That’s one of the many factors of picking a good market to invest in, but really what you should be looking at the property to look at these one-off types of things that may choose to investor from time.

ALN apartment data construction times have continued to climb, but for the first time in more than five years, average lease up duration has decrease. So what that means is that the average time that it takes to lease up one of these things is deficient because more demand for apartments for renters.

Rent cafe says that millennial home buyers feel the rise of lifestyle renting in 2021. Yeah. sucks to be a millenial. Sucks to always be the new guy, right? The top 10 largest city for millennials over $50,000 versus Indianapolis, Las Vegas, Phoenix, Oklahoma city, Memphis Nashville, Charlotte Columbus, San Antonio, Texas,

Louisiana, Kentucky doesn’t necessarily mean that they’re good investment areas just saying that these are where the percent change in applicants among millennials making a 50 grand. That brings us to the Easter egg, which is if you guys want to get access to my free book r eleasing this month, we had to delay it a month.

We got busy because we press go on the retreat and I got busy with that so we delayed it a month, but go to simplepassivecashflow.com/book. The free audio book is on there folks and if you guys like it, you guys like the book, please shoot me an email and I’m looking for people to help me out and write some reviews for me so that we can get some more eyes, ears on the good work of simple passive cashflow the journey to that on Amazon when it finally releases.

Shoot me an email at Lane@simplepassivecashflow.com if you’d like to help out. If you guys are tired of hanging out with a bunch of broke guys and you guys want to talk to other pure passive accredited investors, go to simplepassivecashflow.com/journey.

Check out the family office Ohana mastermind, really no other group out there like it. We gotta change it, there’s about 80 members in here now and then every year the price goes up.

 

Now I’m going to be going into some of my personal stuff. Again, if you guys have any questions, type it into the chat, but I was defined six ways to for my own personal development.

So in terms of growth, we hired the chief operating officer. He starts today is December 1st and more staff is being hired in the coming months. Some of you guys have applied some of y’all, I know you just don’t like your jobs, but we got you on the list. Should an opening come up and this is going to help, allow me to travel and join other groups, get around other circles and find and source the best practices, how do you build wealth pass the five, $10 million stage.

As far as contribution back to the world, that’s what simple passive cashflow is for me, right? If you guys haven’t seen the mision, check it out. It’s simplepassivecashflow.com/mission, but it’s all about bringing like-minded people together. The first conference I went to was way back when in 2016, And I was like, whoa, this is crazy. People are buying.

At the time I was buying little rental properties, turnkeys. I was like, wow people buying properties, site unseen for cashflow 2000 miles away like me, this is crazy. Then I realized there’s a lot of other people doing this. There are a lot of people like yourselves out there, especially accredited investors during this buying, going into syndications with a bunch of seemingly random strangers.

But if you want to make the world a little bit smaller, associate the names of face, get to know me a little bit more on a personal level, and more importantly, you meet other passive accredited investors. Come on to retreats or simplepassivecashflow.com/2022retreat . We’ve got about 75 people signed up at this point. We do have a strict cap due to strict COVID measures here on the islands.

As far as significance, keep closing more deals , more value add stabilize apartments. I haven’t updated this matrix that I did for myself. There’s gotta be three or four slots missing here, but this is how I visualize my investing.

I try and scatter it from class A to class C buildings, maybe a little bit less class C these days. And that’s a lot of this cluster here is how a lot of the first deals where we start. But you also spread it around from the yield place to heavier repositions at develop. And some of you guys, I don’t want to put the cat’s out of the bag, but we’ve got a lot of sales coming in early quarter 1 2022. Time to cash that money.

As far as uncertainty though, h ow do I counteract that? I’m doing a second infinite banking policy and I’m wondering where do I put my money when I’ve maxed up my infinite banking policy? I get a lot of liquidity anxiety when I money’s sitting around, especially large sums of money sitting around not doing anything.

So I’m pondering doing some crypto staking, maybe a hundred, $200,000 to start. But this is where I rely on my family office Ohana mastermind. Some of you guys will email me asking what I’m doing. You guys got to join the family office group. That’s where you’re going to find the good stuff. If you got a hundred thousand dollars and instead of making 0%, you make 10%.

You do the math, that’s a thousand bucks right there that you missed out almost every month, times 12 that’s 12 grand, maybe 15 grand, just only on a hundred thousand dollars. It is silly to just do it on your own and how do I get some certainty? Close a deal recently, and we are looking to sell 3 Texas apartments and another development for more than preforma so that’s cool.

And love and connection, I’m super excited. Super, super excited that y’all are coming to Hawaii, January 14th until 17. Cause it’s not free check it out at simplepassivecashflow.com/2022retreat. But if it was free, you probably wouldn’t want to go in any way because it probably be just another bro fest at the local Reia with a bunch of people who think real estate is the way to get rich.

Just for fun some doodads that I’ve been buying. I’ve been using this whole foods a lot to not waste my time grocery shopping. It also helps me control my spending, buying things I shouldn’t be buying. You guys have seen these bone conductivity headsets. It allows you to hear what’s going on around you so you don’t get hit by the proverbial bus.

As we all joke about a lot and then you get paid out through your infinite banking policy hopefully if you have that all set up. If you don’t know what we’re talking about, check out the infinite banking e-course simplepassivecashflow.com/banking.

You gotta put in your email to sign up for that free course. Of course, I have to have my mic because I’m on the phone all the time. Hopefully, this will prevent me from getting hit by the bus when I do not go golf shoe shopping or outside of the house, I’m a little worried that my wife will now know that she has access to me at all times, even when I’m on the phone.

And I cannot use the fact that I have my apple AirPods pros in my ear, filtering out outside noise. For you golfers out there. I’m not a big golfer, it’s a waste of time. But when I do, I hit Titleist Pro V1 the best ball that you can get your money on, get your hands on. I feel like $4.50 cents per ball’s a little expensive

so my little hack here is I go on Amazon. I used to do this on eBay, but E-bay is a little strange these days. I like Amazon better so I can buy used golf balls but there’s a grading system, I guess there’s single A, AA, AAA, all the five A. Go look it up guys every golf ball provider of these used balls has a different grading system, but you can pick up these semi nicked up balls for about half the price of it.

And when you’re like myself and you just lose them half the time, it takes a little sting out of the whole thing. But when you hit a good one, there’s nothing more pure than hitting a Titleist Pro V1 and getting those extra 20 yards bonus roll off the thing.

That’s it. Thanks for listening folks and we will see you on the next report.

 

Takeaways from Recent Family Office Meeting

https://youtu.be/6iE7Fi3C8Lw

On today’s podcast, I’m going to be going over some family office concepts that I picked up from a recent family office workshop I attended. 

So in this a workshop,  they had a keynote speaker, Tony Robbins, which is cool. He’s been getting involved with cross-promoting with guys like Peter Mallouk. For those of you guys who have read his previous book. I don’t think he works with them anymore. I think he works at the sky agent cooped up, but all these guys advise high net worth, a hundred million dollar families and above. 

Here at simple passive cashflow, myself and my other folks in my family office group, we are folks getting from 1 million to $10 million plus. There’s not really any groups for that so I decided to create it. If you guys want to learn more, go to simplepassivecashflow.com/journey. 

So a lot of the stuff I’ve been talking about today are geared for those hundred million dollar net worth families and above. So you take it with a grain of salt and I’ll try and add in some color what really applies to the broke guys under $5 to $10 million net worth.  For those of you guys checking out the  YouTube version of this. This is just a part of the e-course. The ultimate e-course, which I’m going to add in the notes in here later on. If you guys haven’t checked out all the e-courses we have, including the free infinite banking one, you can check that out at simplepassivecashflow.com/banking  and check out all the e-courses. If you go to the top, I think there’s a section for e-courses.

But here’s the first lesson that I learned. To get rich, you need to  really concentrate what you do first. Now a lot of you  listening, you guys are just salary guys. I paid salary guys. A lot of you guys make a hundred, 200, $300,000 a year plus per person. But the concept that they talked a lot about is, if they looked at the people who got up to the Forbes 40 lists. Your top billionaires and then you take a look at the people that left that list. I think you’ll find some very similarities where the people who got up though this, they were very concentrated. And the people who left the lists lost a lot of net worth . They did that  because they weren’t diversified and what got them there was ultimately what got him kicked off the list. . 

A great example, if you guys are familiar with Forever 21, it was like this Korean couple. They went all in on retail and just expanded like crazy. Some bad luck. Which of 2008 recession happened and the  rise of e-commerce. But, what they should have done is they should have found a way that diversify maybe in the same industry to leverage their networks,  current infrastructure but perhaps they should have diversified. I think they lost well over half of their net worth.  They got a billion bucks  I’m sure. But I think the bad way of taking this advice as being like I gotta be diversified. I don’t want to lose my money. But if you’re under like 10 million, a hundred million dollars net worth, I still think you’re in the “hey  concentrate how you’re making your money” and you’ll got to that point where you really can diversify. Just important to keep in the back of your mind. Once you hit your end game number and for a lot of us in our family office group, the end game numbers, we’d be up $5 million. 

Oh, so what does this mean for us? Since a lot of you guys are just salary workers or  entrepreneurs, business folks focus on how do you trade time for money at the best, which is likely at your day job? But invest on the side to get you up to that certain point.  Build up a  portfolio of concentrated real estate was all a lot of the people on this top Forbes list got their money and they diversified it. 

So another point I had here. I don’t have a BlockFi account. I have a BlockFi account but I don’t really invest more than a couple of grand in it. For me, it’s a waste of time, right? My time is better spent finding real estate deals.  If you guys are working pretty simple, 40 to 50 hour a day job you’ve probably got some time on your hands. But no offense. Your time might be better spent, learning a little bit about Coinbase, BlockFis, D5 platforms playing a little bit of money on there than to deal with a bunch of turnkey rentals or something like that. If you guys make over a couple of hundred thousand dollars, $200,000 a year, I would say perhaps, unless you’re really ambitious and you don’t have kids, you’ve got some free time on your hand. You’ve got a little bit extra bandwidth and you find it fun. If all those things line up. Then yeah, knock yourself out. Learn the Lord bill bought it. I like  the world of crypto was going, but for me, I’ve made the conscious decision as an operator of apartments that I need to focus on that and stay in my lane. 

Another thing that they talked about was this concept of avoiding locker room talk or the common guy. What’s a common guy starts to talk about, deals or ” Hey, there’s this great startup company or tech company that’s coming up my friend knows them, he trusts them” or the taxi cab driver talking about some kind of deal, whether it’s real estate or tech or just some business. And you start to hear these wordings of ” we’re going to go eight to 12 X in the next few years but you got to get in now this is the last week”. It’s just a sign of a sucker deal  and that’s what’s really hard. When you’re just some average guy, I still put myself in this category, you’re not getting access to  good deals. You’re just getting access to these sucker deals. If there were not great deals, you and I probably wouldn’t really get access to them. 

 Whenever there’s like that false sense of scarcity, right? You got to get in now, man, there’s this crypto thing is going to blow up. That’s a sure fire way to know it’s a scam, multilevel marketing type of thing. We’ve talked about that the past and the investor letters where, groups will pump up one garbage coin and it just becomes like a Ponzi scheme where the first people who were in, they got out  and then  everything tanked as everybody’s in that kind of investing  period. 

Another idea they talked about was if somebody came up to shark tank, And with Mark Cuban, Mr. Wonderful and they use that same conversation line that we’re going to eight to 12 X in the next few years, but you got to get it now. You get laughed off the set in that situation. 

For a hundred million dollar net worth families. Again, you take it for what it’s worth. The goal is to have eight to 12 non-correlated asset. In your portfolio. First question, what’s a non-correlated asset,? Non-correlated assets are like things that  are not correlated with the economy. Now there are different varying degrees of this, but I probably put real estate. Commercial real estate in this bucket to some extent. Other pure non-correlated categories are life settlements. It’s a morbid thing, but you can bet on people dying as you buy out their life insurance and you get paid up when the person passes away. It’s nothing more sure than death and taxes. 

Other non-correlated things are this is what the life insurance companies they invest in right. Large institutional class A assets, primate markets. Really nothing’s more certain let lower return than  that type of stuff. 8 to 12 kind of seems like a lot, I think what they’re talking about is multiple deals. Spreading your net worth out and having each of those to be non-correlated or to like hedging each other within  there. 

Me personally, most of my worth is in multi-family apartments, which I feel like is pretty safe. The need for lower middle-class housing. I don’t think that need is going to be going away. In fact, I think that demand is stronger and stronger every day as our population in our country and the wealth cap increases. But, I’m nowhere near a hundred million dollars net worth, but I need to be thinking, all right, how am I going to start to take, maybe I don’t want the best returns, but I just want certainty. I looking for those non-correlated assets in the future. Some of this might be crypto, so it might be gold. I don’t do that stuff quite yet, but it’s something I’m thinking about in the back of my head. The other thing that they said is Cassius trash, and this is coming from the high net worth folks. Inflation is a lot higher than you think. Somebody mentioned that 40 years bull market in bonds in the last year, guys. Where now $128 trillion is globally looking for parking right now and you guessed it, it’s going into real estate. As you’ve seen, Blackstone and just picking up little rental properties, I think they’ll fail. They did this back in 2008 when the big institutions just aren’t really good at managing assets, especially small little ones when they’re all separate around. What they really want to be in is large multi-family apartments. Where they could buy them within big dozens sets. 

Another point was don’t chase what is running. So crypto and tech are two things that are running in this point right now.  We talk a lot about emerging markets buying in places where the population is growing because of some economic growth and that’s more from a geographic standpoint. But what they’re not talking about is more from the assets sector approach. 

Real estate is another place where it’s always been even kill. People think, look, real estate is getting really expensive, but on all the highs and lows are pretty much smooth it up. Compare to tech bubbles and the crypto market. Try and look around what is the things that people aren’t doing? Something that I was looking at was maybe a development deal in New York. I’m not going to do that but like just thinking outside the box, right? Where is it that the unsophisticated money is not going into or is definitely afraid of. Maybe now is the time to go into shopping malls. No, I don’t really believe that I’m just joking there.  That’s traditionally been beat up over the last several years, perhaps now’s the time to go into it. Getting outside the real estate world, what is something that people, the rush has got passed and gone. 

Another thing we mentioned that the bond market is flipping. If the bonds can’t get the yield we want. Where do we go? So what are the high net worth families doing is they’re buying businesses or alternatives investments, the outer world.  That’s essentially the world that I tell a lot of people to get into. Get off of the retail main street or wall street investments where you’re getting killed by all these hidden fees and carried interest. 

Get into more alternative investments where you’re directly investing with the sponsors, cut out all the middlemen and get into more non-correlated assets because the problem with all the retirement funds and 401ks and all these mutual funds is you’re in this  heavily correlated to the economy types of assets. It doesn’t take a genius to make money.  In Tesla, when the stock market is going like crazy, like how it is because of all the quantitative easing and fake money.  It’s always going to make a run. The point is you don’t know when it’s going to drop so smart families, what they do is they diversify and like you said, non-correlated assets. 

One thing, bonds are a way to get cashflow and for people in our group,  once we hit around three to $5 million net worth, our mindsets starts to  to change. $5 million for most folks is enough money to just safely cashflow it. Maybe you’re not going to get 12, 15% plus, but you can save the cash from maybe eight to 10%. Take something like AHP, for example, you’re not going to load up your whole entire portfolio with non-performing note fund like that, but it’s going to be a small piece of your portfolio so you can get diversification and it operates like a bond. In a way where it’s just meant for cashflow and security. 

But with the bond market going away and where do you go? The high net worth families, they buy businesses. Not really for the growth potential, but the business is producing that cashflow every single month for them.  Take it for what it is! Some of you guys are probably taking like that I need to go buy a laundromat or I need to buy a carwash on those drive through car washes. Some of you guys, me personally, that’s what tells me is I’m going to go buy an apartment building or jumped into a syndication where I don’t have to do anything and I can get all the tax benefits without all the headaches. 

 Maybe some of you guys you’re a little bit more ambitious out there. Maybe you go buy franchises. From another perspective. What you want to be doing is getting away from ordinary  income. That’s what you get from your day job, your 1099, as you guys contractors out there, you guys want to move from that spectrum to the passive income side so you can use these passive losses to possibly offset your income on  that side. 

Ajay Gupta, the guy that Tony Robbins kinds of self promotes with. I think there’s probably some kind of partnership there with referrals. All of these gurus, they’re just marketing referrals to other people in the space. I think Tony Robins used work with that Peter Mallouk guy, but there was some kind of scandal or something you guys can look up that type of stuff if you’re interested. 

They asked Ajay Gupta what’s your asset allocation model and we’ll do this in our family office group. You know where it’s more applicable, right. People between one to $10 million net worth. If you guys join up that we’re not going to show you what people in our private group are doing. 

But what I’m going to outline here is what Ajay said, what high net worth   hundred million dollar families are doing I’m not saying it’s right or wrong. But when I go through this again, make sure that you’re taking it with a grain of salt. Y’all are a hundred million dollars net worth. You guys are barely even five or 10 minute dollars network. Don’t emulate what they do, but kinda take some things and maybe if you can emulate what the high net worth are doing. 

First of all, he said 50% of his stuff isn’t real estate and of that the 40% which is the 80% of the 50% is in cashflowing  multi-family self storage, like bonds, we were talking about earlier for cashflow. The other remaining 10% of the 50% or the minority port is 50% of his real estate portfolio is in  land, which the purpose of that is to preserve  value. 

This is exactly what I’ve been preaching to you guys all the newbies, they buy land and I’m like that doesn’t cashflow. That’s what you do when you get to be five, $10 million plus, or what Ajay is saying here is a hundred million dollar net worth families. They don’t need the cashflow. They’ve got $40 million in cashflowing, multifamily and stuff like that. That they can afford to have some money just sitting in a land bank, not doing anything. This is what they do. This is probably not what you guys should be doing. 20% of their total portfolio are equities. Now this is the stocks. Probably on their own and mutual funds and stuff like that they’ve probably got private managers to  do it. 

But this is what the high net worth family is. The very small portion of their money. 20% is in stocks. It’s just, it should be shocking, right? Like, why is it that the average American is like 80 to a hundred percent, this stuff? This is where success leaves clues. Do what the high net worth families do and they are very small minority in equities. Probably because it’s just convenient, easy for them and they’ve got 50% in real estate cash flowing like crazy for them. 

The next thing that they have is private equity. So this is approximately 20% of their total portfolio and private equity is seen as businesses, but not necessary the LP  part. Now,  when you’re a hundred million dollar net worth family and above, you can push your weight around and there’s a reason why you got to that point in the first place. So there’s some kind of operational value that you bring in that you can contribute in some substantial way to the general partnership. 

 This is where the rich are getting richer. These families will go into the general partnership, not saying it’s real estate. But more like operating business is where the family has built up at the network and the synergies and experience to add value in that system. 

So for example, say you are a guy doing a pizza franchise and you make dozens of these things. You’ve got your net worth to 50, to a hundred million dollars. Something that I’m just making this up on the fly. Something that might make sense to you is going and buying similar franchises that supplement either it’s very similar business model to the pizza franchises, or it is a supplement or adds on and augments the returns of the featured  franchises. 

Maybe you go buy a bunch of breweries, I don’t know, and combine the two. So these are seen as more asymmetric returns. So this kind of counteracts the cashflowing assets the 10% of their luggage sitting in lazy equity and land. This is the asymmetric part of the portfolio where the private equity is somewhat speculative, depending what kind of business you’re getting into. 

It’s not really like cash flowing  apartments or anything like that. These are more like businesses. It could just fall. But these are the opportunity for them to grow their net worth even more. And but it’s also heads from the other side and in this thing called what they call this tailrace. Or you could think of this as insurance. So this was a new term that I caught on a little bit. So what they said is, Any bet that you’re making maybe take two to 3% of that bet and put it in something that hedges your investments. So that should your investment go bad. That two to 3% greatly increases to offset your loss. I’m not, maybe in the stocks, maybe it’s like kind of buying I don’t know what it’s called. Maybe like a call position or put position and something that does the complete opposite. Or. Maybe buying a business that kind of supplements. Or it’s the opposite when one does well, the other does well. So for maybe if you have a short term. Rental, maybe you have some long-term rentals. So again, this is the concept of tail risk. This is what high net worth families do, right? When you have a hundred million dollars net worth and above. When you’re less than $10 million net worth. I don’t know if you, if a TRS is really that appropriate. I don’t know if putting money in land, is that appropriate? But it’s just something to think about, right? When you go into a deal, what is some way, where are you putting some money? So if the deal doesn’t go as well because of the economy, because it’s correlated with the economy. That piece can burrow and make the hurt a lot less. Just some side notes here. And they said maybe they like two to 3% in crypto. If not real estate. Where do you go for storage of wealth now, real estate just checks all the box off this stuff. It’s a hard asset. But the reason why you would want to do maybe just a little bit of crypto is because maybe you don’t have the ability to operate real estate. Then you get into syndication. But then again, the question is what if you don’t have the ability to find good, honest people to work with? And for those people. You’ve got to look elsewhere. There, there are other groups out there that, they’ll teach people all about index funds all day long because their assumption is that you guys out there are unable to build relationships with people. If you guys have been listened to this podcast for quite some time, and we haven’t talked, you haven’t joined our investor group and sign up for our lists. What are you guys waiting for? That’s probably the majority you guys. I’ve probably have maybe two calls a day with you guys and we’ll continue to do so until it becomes too much. But if you guys are one of those people out there that listing for several years now, and if never really engaged with me, Yeah, like real estate, probably. Ain’t your thing. You’re just not a good people person. And that’s cool. You’re really losing out. But then, yeah, that’s, if you’re unable to play nice with others and build. Real relationships because for high network people, your network is your net worth. Then that’s what you get. You get the scraps go after your index funds and go off of that. 

They say two to 3% crypto, if not real estate, where do you get the storage of wealth? Maybe they’re saying gold and silver, which is alternative to crypto. It suffice for the same thing, which is just a storage apart assets. And this is a big mistake I see for people that are under $5 million net worth. They load up on a large amount, maybe like five, 10% plus of their net worth in gold. And this is what I was saying. My first point was just because the high net worth people are doing this stuff doesn’t mean that you should be very careful. The people that you see, the gurus that you see on the internet, a lot of the time ask yourself, how are they making money? A lot of these guys will just be pushing out as affiliate marketers for gold and silver. And just trying to, scare the heck out of UC Bowen to gold and you buy from them that they make their three to 5%. So I don’t have any gold. If I were to, if I really wanted to hedge myself for currency and I wanted to. Just store wealth, which I don’t know if it’s very prudent. If your net worth is under $10 million. I’ll be do crypto. But I don’t trust myself to hold those cold storage wallets. So I’ll be doing it in an index fund, which sure. I’ll pay an expense ratio of 1%. There might even be some carried interest. There’s a lot of good ones out there. There aren’t really that many ETFs really yet. But very soon, I’m sure you’ll be able to get into this stuff where you don’t have to run around with a plate of engrave, You’re garbled means have your password and have to worry about that type of stuff. To me. That’s where I, I’ll pay for that convenience. And at least that I’m not the single point of failure to forget my password. Another important thing that these guys preach was reshuffling your asset allocation. Now this is, I tell a lot of people on our group write every year, take a look at your investments. Maybe 20% off that are your losers that don’t have the good return on equity. I’m going to say what’s return on equity. What if you have debt equity sitting in your homes or rentals? Get that out. Check out thePage@simplepassivecastle.com slash Roe for that worksheet there. But yeah. Reshuffling your asset allocation, figuring out what is your. Your most pain in the butt properties too. And then always be pruning it right. Selling off those assets, putting it into new stuff, keeping it fresh. Same thing that the high net worth do and something that they said that really stuck with me is. Do this, when things are good. Because selling the good ones. Is hard. Because essentially what you’re doing is you’re increasing the losers, right? But when things are bad. You’re going to be really wishing that you did this. Some of you guys might have, you started with, very crude at 5% of your net worth that the crypto. I still think that’s a lot, but now it’s 30 and 40% in crypto and you’re still riding that. But what happens when you lose half of it overnight? You’re going to be wishing you, what you put 25% of your net worth into real estate. Where yeah, you weren’t, you’re not going to make off potentially high return. But in that next. Reshuffle, which will always happen. You have it there. And part of this is just like mindset. If you’ve made a bunch of money in crypto or some other elsewhere or your business. What into somewhere where you can reliably make good cashflow and it’s a good store wealth. I don’t think anything is better than real estate. I doing this. And of course diversify it out over multiple assets. But, it’s kinda like this thing where it’s A lot of the stuff we talked about here from these family offices, maybe don’t apply to listeners here today. You still have to grow your network to me. Until you get up to $10 million net worth. Now maybe $5 million, you should have number, that’s where you’ve personally hit zero gravity or escape velocity. At that point, now start to change your portfolio to more the bond model. you’re going after more cash line businesses for cash flow, you’re going into asymmetric risks or limiting your aims to metric risk types of deals. Going into insurance, oh, yeah. I forgot to mention that. 5% of these guys’ network is in life insurance. That type of stuff. Infinite banking, right? That’s exact stuff we’re talking about. Simple, passive castle.com/banking to read all about that and get the free e-course by signing up there. 

They also mentioned there was some follow-up questions too, but like NTS, that’s the big rage right now. And, they said They were very like, timeless about how they gave us advice. Because I think right now you have a lot of YouTube videos everybody’s into NTS is the thing that talk about. Other than AOC stress or write text or rich type of stuff. But they say collectibles have always got up and down and in waves. And, the NTS is just more of a virtual thing, but, collectibles, like art. Wine. Maybe not baseball cards. But the time these are timeless. Rare valuables that always come up in waves. And it’s important to understand when it’s high, when it’s low and now it’s high. So don’t be the. PETA sophisticated investing do not buy now. And they always, they said the same it’s always been a very timeless piece of advice to buy two cases of rare wine. Save one, but drink the other. 

And they also close things out. And this is what we talk a lot about in our family office group is, more of the legacy creation teaching the next generation about wealth. All too often, I think what typically happens for first-generation wealth people is that. We spend all this time. Maybe we do it the wrong way. The 401ks mutual funds buying a house to live in right out of college, that type of stuff. Or as soon as we get money, ultimately it just we do this the wrong way where it doesn’t, it takes. Maybe to your fifties, sixties to get finally get financially free for most people. And in that time your kids have gone there. The. Once they hit 15, 16 years old, you’ve lost that opportunity to model the next generation. And that next generation. Sure. You’re going to pay for every means to go to that. To get college educated. But I think the problem is where you lose impact of the next generation on born generations, the grandchildren, because all their parents, all your kids are going to be able to teach them is how they went to college. And that may or may not be their thing. And we all know that what. Where they’re going to be putting their money, investing their money is going to be at the wrong places. They’re not going to learn how to make money. This is why, for a lot of people. That have joined our groups. I tell them, Hey. Give them that incubator investor e-course to your kids have them learn about this baseline level of stuff. They’re not a credit investors. Yeah. They don’t, they shouldn’t be going to syndications yet, but haven’t learned about the basics now to learn what’s inside the black box so that when they are passed on the wealth, They know about how rental property works. They just know basic business skills. And how the world works. And of course the last thing here is, health as well. The difference between somebody with a hundred dreams and only one is. In the, so the difference between someone with a hundred dreams and only one is their health. If you think about it, 

Right now, a lot of you guys are healthy. But if somebody told you in the next few months, you’re going to die because you have some terminal illness. You only have one thing in mind, which is your. It’s just surviving. Unfortunately, most people make changes. In life until they’re forced to. 

This can be said for a lot of things. Might them something. I’m thinking about lately is, the choice to quit my day job. And do this stuff full time. So people learn about real estate and get into deals. No, that was a big choice for me. 

But once I made that choice. My destiny was formed and I moved along this path. 

I, in that case, I made the decision. It wasn’t like a situation where things just got so busy and I was forced to do it. Maybe if you guys are thinking in the back of your head or something that you guys need to make a big change on, be proactive. Don’t be somebody who lets destiny force you into making that change. Make it yourself and control and all that. So that’s all we got for today, guys. If you guys like if you guys want me to share more stuff like this, let me know. And we talk a lot about this stuff every couple of weeks in our family office group. Which we don’t have any a hundred million dollar net worth families and above and nor I don’t think you would want to. 

I think if you guys are somewhere between a million, 3million dollars net worth, that’s pretty much where the average in our folks are at. Everybody’s still working. Everybody’s really busy. It’s meant to be a side financial club onto already what busy plate you guys are working on. Every group out there they’re trying to teach broke guys how to get rich, doing big deals. There’s really no other group than our family office group where  we’re teaching you guys how they just keep doing what you’re doing in terms of your highest and best use at your jobs, your salaries, your businesses. But how do you invest the right way and what deals to go into, who to stay away from. We help cultivate best practices for tax, legal then we connect you with the right professionals to make that happen. 

But the biggest benefit is the network and as you start to create your own family office, start to emulate what the hundred million dollar families are doing and above you’re going to meet  up to your group, the people that are on the same trajectory and on the same path as you. People you trust that you can rely on. More information on that, visit simplepassivecashflow.com/journey and I will see you guys next time. Bye. 

Tax Benefits for Married Couples

Changing your relationship status from being single to married has additional benefits besides being with the one you love. This includes going on a journey in life together, dealing with your in-laws, adopting the family name of your husband as well as a change in tax filing which could mean some tax savings! 

Once you get married, you will have an option for tax filing if you want to do it together or separately. Once you decide to file jointly, you are affected by your spouse’s income, tax credits, and deductions (e.g. from real estate). 

single to married

However, if you prefer to file separately you cannot declare the standard deduction and you cannot take tax credits (like a child and dependent care credit).

Benefits of Filing Jointly as a Married Couple

Lower Tax Bracket

This has been a problem for some married couples before due to the marriage penalty. The marriage penalty used to happen when both earn almost similar salaries if combined, which drives their tax bracket to a higher level compared to when they were single. Luckily, Congress took action and reduced the penalty. If the spouses have significantly different salaries, the one who has a lower salary can pull down the other (with a higher salary) into a lower bracket. Thus reducing their overall taxes. Off the top of my head, this helps those single pilots who are plentiful in our investor club who make a great salary but are getting killed with taxes.

Securing the Estate 

When you are married, you have the advantage to protect the assets of your spouse when they leave behind. Because under Federal Tax Laws, you can leave an amount of money to your spouse without the need to pay an estate tax. This privilege can protect the deceased’s estate from taxation. 

https://www.youtube.com/watch?v=0d5CAh682VI

Is your spouse still skeptic about real estate investing?

   👈Watch this! 

Save Time 

This especially applies to the wealthy since for them time is gold. Of course, it will save a bunch of time in accomplishing the paperwork when filed jointly. 

Implementing Real Estate Professional Status

If you are able to implement a Real Estate Professional status tax strategy (REP) you can use passive losses from syndication deals to lower your ordinary W2 income. If not (i.e. two full-time working spouses) your only other option is going into land conservation deals, solar deals, or oil and gas deals – all of which have some risks.

Note:

1) There is ordinary/W2/active income on one side. Let’s call that the 😔 side.

2) And there is the ☺️ side! Coming from passive income (syndications, passive partnerships i.e. medical/dentist offices) and passive losses (depreciation, bonus depreciation via cost segregations common in syndications).

You can use passive losses to neutralize/eliminate passive income. That’s the good side and why passive losses are called PALs too (Passive Activity Losses).

From spouse about investing

There is a barrier between 1) Active Income and 2) Passive Income above.

You cannot offset passive losses (PALs) for active income UNLESS you are a real estate professional for tax designation purposes and able to create a “grouping/active participation”.

We work with our FOOM folks to help them craft their individual plans if REP status is possible for them.

It’s frustrating because most people:

a) Don’t stick with this and try to learn it. (Trust me it’s easier than first year college physics) It will take a few times before you get it as well as after networking with real people doing this 

OR

b) Say it’s risky and listen to their lazy/ignorant CPA. Who by the way has been stuck in they same occupation for 20-30 years.

Why would you want to take financial advice from someone who is not financially free? If you come to our Bubble/Masterminds or meet a few sophisticated investors in our community you would likely fire your current tax professional.

Listen

When a deal is successful and sold (full cycle) what happens then?

All investors will have to pay back the depreciation recapture (losses taken throughout the hold) and capital gain (the big payout on the end which is sale minus cost basis).

But don’t despair because although this is the case when you look at it myopically, in reality most investors go into multiple deals accumulating 100s of thousands of passive activity losses in their first few years investing. Those losses do not go away, but they become suspended to be used to offset future passive income and sales/capital events like this in the future.

When you exit a deal, what normally ends up happening (like Tom Brady keep winning more Super Bowls) is that you go into two more deals (with now double the amount of capital) and you will likely find that with those new K1s you could result in you having way more passive losses you began with.

If you can see where this is going… Yes, experienced investors with a lot of capital deployed might have 500k-1M+ suspended passive losses and have not paid taxes in years and do not appear to pay taxes for years!

Note: You can find how much suspended passive losses you currently have on your IRS Form 8582 – which your CPA is likely not giving to you and in that case you should get a new one.

Reasons to File Tax Separately

Your Spouse still has Unpaid Student Loan

Most student loans are not being paid much attention after graduation and at times it is being neglected.

Separate tax filing

This can cause problems since federal student loans are on an income-driven plan which means the amount that you pay for your loan (each month) is based on your salary. If this is the case then it is better to file it separately. 

Unsure with your Spouse

If for any reason you are having doubts or trust issues with your spouse then it is better to file separately to avoid being liable with your spouse’s taxes on their income. This will benefit you if you’re considering divorce in the future.

Remember:

  • When investing with a spouse, it’s important to have a plan when managing finances and investing. 
  • Every couple is different.
  • Discuss different strategies on how to talk finances with your significant other.
  • Recap of Breakouts. 

 

‼️Very Important‼️Communicate with your spouse.

https://www.youtube.com/watch?v=65knagQEczg

In essence, proceed with the tax filing process where you would benefit most. Also, seek expert advice (from CPA) which is the key to understanding the whole process and you can maximize your tax benefits.

Check out this page with some tips on communicating these new ideas to your spouse.

More semi-useful info to be 1% better every-other everyday.

 

Why Investors Must Consider Real Estate in Huntsville Alabama

As of today, half of the year 2021 has passed. Though there is presence of COVID- 19 vaccine in the market, uncertainty in what things may come and in the real estate industry still never left. While we cannot eliminate the presence of uncertainty in our lives and what lies ahead, these two indicators drive real estate investors’ confidence: market history of real estate and how our country’s economy is slowly gaining its momentum back.

Can opportunity still exist in real estate with uncertainty at hand?

A big YES!

Real estate investing in Huntsville

Imagine we just started with less than a hundred apartment units in 2018 in Huntsville, Alabama.

As in any other state where we diversify our real estate portfolio, let us appreciate and get to know more about Huntsville, Alabama.

Why Huntsville, Alabama? 

Huntsville is located in the southeastern state of US, Alabama. Its population is approximately more than 450,000, almost grew by 12% and is one of the most heavily populated cities in Alabama. This growth is brought about by the growth in information technology, aerospace, and advanced manufacturing industries.

Years back, Huntsville was heavily acknowledged for its agricultural industry but now they are home for the NASA Marshall Space Flight Center, US Army Redstone Arsenal and big manufacturing industries such as Toyota and Boeing. 

Aerospace

A switch from agriculture to industrial is the fundamental change causing their booming economy.

Main Qualities Leading Huntsville Real Estate Market

Huntsville Economic Framework

Who knew that Bama… of all places would house this aerospace and defense Mecca. We previously referenced NASA’s Marshall Space Flight Center and the U.S. Armed force Aviation and Missile Command and they are just two of the significant businesses in the city which blaze the trail for countless of other ancillary tech and hardware companies – more than 300 aviation, protection, and government workers for hire notwithstanding the many, numerous different organizations in the area. 

A large number of these workers for hire have practical experience in IT and designing. Government contracts are normal. Redstone Arsenal (the U.S. government) is the top business in Huntsville for 37,000+ workers in the area. NASA comes in third spot with 6,500 representatives, surpassed by the Huntsville Hospital with 9,352 workers. 

IT

Moreover, Huntsville is a city with solid aviation, designing, and protection areas. Supporting these businesses in significant manners are data innovation, bioscience, progressed assembling, and medical services areas. Likewise, retail assumes an important part in Huntsville. 

The strength of Huntsville’s monetary spine is plainly exhibited in the insights. In September 2019, Huntsville boasted a joblessness rate of 2.8 percent.

Job Opportunities

Occupation development hits 3.6 percent (2018-2019), showing a pattern that drives specialists to foresee future occupation development of 40%. Obviously, COVID-19 introduced critical difficulties as far as occupation development and work. In spite of this, the Huntsville region has kept on demonstrating itself to be hugely strong to a difficult, remarkable year. Across our 600+ units in the region we saw occupancy increase and rents go up even in 2020… and even more in 2021.

Notwithstanding a 8.3 percent drop in work among March and April 2020, Huntsville stayed well in front of public insights. Specialists anticipate that the economic recovery should require two years and three years for the GDP and vocations rates to get back to pre-pandemic levels, separately. 

In the prior phases of the pandemic, generally March through June, Huntsville saw a year-over-year distinction of 7.5 percent in business – contrasted with the national drop of 13%. 

https://www.youtube.com/watch?v=PgF9o3aekak

Consistently, from 2000 to 2020, we see that, all things considered, Huntsville experienced work development twice that of the United States all in all.

Living Wage

In addition to the fact that Huntsville stands out from the rest as far as joblessness rates.

Huntsville is home to altogether more workers with a yearly compensation of $75k – 200k+ than the remainder of the territory of Alabama. 40% of the populace in the Huntsville metro acquires in this reach, though just 29.6 percent of all Alabama occupants fall into this class. In other words, the workforce is highly skilled compared with most US cities.

Local Amenities & Conveniences 

Here in Huntsville, Alabama, we appreciate and focus on open air spaces especially due to the  COVID-19 pandemic. Let’s admit it, Huntsville isn’t simply home to a hotter, more lovely environment, yet it is home to numerous city conveniences and administrations that advance outside amusement. 

Huntsville is home to various recreational areas , scenic routes, and trails. 

As investors we can breath a sigh of relief that we don’t have to worry much about Hurricanes coming anywhere past Birmingham which is a couple hours south of Huntsville.

Huntsville trail

Obviously, there are business impetuses. The economy normally assumes a significant part in the strength of the housing market. Huntsville gives different motivators to draw in a developing, various economy. Given its achievement in work and pay development, it is protected to say these motivators are getting the job done!

Culture and Population

Like in any other area in Alabama, the real estate market in Huntsville is impacted by the economy, culture and population. The most recent U.S. Registration shows that Huntsville is en route to turning into the biggest city in Alabama which is not surprising at all. Additionally, they have had a development in population of a few thousand every year. In fact, individuals realize the region’s peculiarity is due to steady employment, great schools, a perfect local area, and delightful open country.

Why Huntsville Alabama Real Estate Market?

Link to chart

Let me guess, you might be wondering why we are “pushing” the Huntsville real estate market well in fact there are other regions such as Birmingham or Montgomery. 

https://www.youtube.com/watch?v=MymYO40wx9s&t=3s

Believe it or not, Huntsville unmistakably has a strong establishment as a housing market. With its consistent development in population and a different yet specific economy, it just draws in more land interest as time passes. On the off chance that you plan to put resources into the Huntsville housing market, nonetheless, you need to know explicit land measurements alongside the remainder of the city’s economy and segment setting.

Factors Contributing to Huntsville Real Estate Market

Real Estate Statistics

What contributes to a solid housing market? There are many elements we could name, in any case, two are at the core of long haul wellbeing: solidness and reasonableness . Huntsville possesses all the necessary qualities. Studies show that Huntsville flaunts the best housing market in the entirety of Alabama. SmartAsset gave the city a 88.41 rating on the Healthiest Markets Index, which depends on four variables: reasonableness, dependability, smoothness, and hazard of misfortune.

On their rundown, Huntsville positioned 26th in the country. Despite the fact that Huntsville is a more well-off (and expensive) city than most other Alabama markets, homes just expense a normal of 17.2 percent of family pay. This is well inside the edges of reasonableness. 

Renovation

Likewise, Huntsville was remembered for the U.S. News and World Report ‘s rundown of best places to live in 2020. Lucrative positions joined with a minimal expense of living and an exceptionally instructed populace added to its positioning, among different components.

Value and Demand of Property

Huntsville is a moderate market by numerous different norms in the country, it isn’t pretty much as reasonable as it used to be. As indicated by Redfin, the middle deals cost in Huntsville was $270,000 in December 2020. Only four years prior, the middle deals cost was $199,000. And with this, 30.2 percent of homes are sold above list cost. This is more moderate compared with the public middle – $335,519 in 2020 contrasted with $254,093 in 2016. 

There’s no question that the Huntsville market is appreciating. Twenty years prior, the middle home cost in Huntsville was an insignificant $98,000. Moreover, home estimations are on the ascent.

Note, in any case, that this development has been, over all things, stable. Once more, when we take a gander at the numbers, we see market flexibility in this information alone. Huntsville middle home costs scarcely recoiled through the 2008 Great Recession. With few special cases, the patterns in Huntsville have been consistent or up for as long as twenty years. All markers highlight this pattern proceeding later on, especially when we think about the splendid monetary viewpoint for the metro region.

Evidently, Huntsville has seen speeding up land interest for quite a while at this point. It appears to be like the COVID-19 blast just advanced this continuous pattern! Like in January until November 2020, Huntsville saw an aggregate of 8,223 home deals (748 deals each month). 

House construction

Deals alone don’t disclose to us a full image of market interest. We should contrast these numbers and the quantity of properties recorded available. In contrast to different business sectors in the country, Huntsville didn’t encounter a critical stock in Spring 2020. Consistently, the Huntsville market has kept up approximately within the range of 1 and 1.8 long periods of supply without huge change in the quantity of properties recorded. 

Month’s inventory is demonstrative of the connection amongst market interest in land. The fewer months (or long periods) of supply shows more grounded market interest, while additional time available (more long periods of supply) demonstrates lower interest. A lower number discloses to us that there are a bigger number of purchasers than merchants and in this way, there is greater action and contest inside the market. 

In December 2020, Huntsville homes saw a middle of 44 days available as per Redfin. That is down almost 12% from a similar time last year. Multiple offers are genuinely normal, as are homes sold above list cost.

https://www.youtube.com/watch?v=gZoqxo9VH3w

Be that as it may, most homes sell for list cost inside just shy of two months.

Real Estate Rentals in Huntsville

Based on studies, 45% of Huntsville’s populace lease their homes, dominating the 32% Alabama state portion of rental occupants. By far most of the properties in Huntsville are single-family homes (64%) with three-to-four room homes being the standard. Rental occupants had a middle move-in year of 2015, where property holders moved in at the middle of 2006. 

Thus, this focuses toward longer rental periods (subsequently, inhabitant maintenance), as the middle number of rental occupants have been leasing their homes for a middle of five years. 

https://www.youtube.com/watch?v=nqln54QS5Ss&t=17s

Huntsville additionally experienced lower opening rates (at 4.49%) than that of Alabama (9.69%) and the United States (5.97%) overall in 2019. This has not generally been the situation, yet opening rates in Huntsville have forcefully dropped in the course of recent years. 

Yet, shouldn’t something be said about the expense of leasing?

Rental Cost

Multifamily homes and single-family rentals comprise the real estate investment scene in Huntsville. Like the lease costs for multifamily units in Huntsville have been consistently on the ascent. Truth be told, consider that they have one of the quickest developing rates in the country. This measurement probably will not identify with our particular properties, it shows rental patterns that are important. With the developing Huntsville populace and tight home stock, rentals are popular. 

Simultaneously, single-family rentals are more copious (and alluring) in Huntsville. This exhibits the excellent chance to put resources into Huntsville SFRs. 

Yet, shouldn’t something be said about the expense? 

Clearly, multifamily properties don’t lease for similar numbers as SFRs – they have a higher month to month lease installment and hold occupants for longer periods. So, a benefit as far as inhabitant maintenance can be found in the middle lease cost.

While in midtown Huntsville lease expenses can undoubtedly hit $1,200, the middle lease is at $858 – $866. This is higher than Alabama overall however lower than the United States middle and normal. This is a 9% year-over-year cost increment. 

Rent payments takes an average tenant 15.33% percent of occupant pay – contrasted with 18% in Alabama and 20% across the country. This shows a degree of reasonableness that is empowering to purchase and-hold financial backers. 

Presently, these numbers are not characteristic of our particular venture properties but signals that the overall market of renters can pay more!

About real estate

Why Invest in Huntsville Real Estate?

Huntsville gives so many of the key pointers that make for an advantageous value market. We have seen consistent property appreciation for the past twenty years. Indeed, even after the Great Recession, we see a market that is still developing and amazingly versatile. With dependable government work (FBI headquarters coming in now) assuming a significant part in the area and financial development, financial backers can anticipate a consistently developing monetary base, low joblessness, and generally safe of an economy-based land slump.

Factors to consider in real estate investing (Huntsville, Alabama)

Continuous Growth in Population

Family

Population brings rental interest. 

Modest Housing

Even if lodging costs here are higher than in the remainder of Alabama, a more wealthy local area implies that these expanded costs just take a moderate level of pay, both as far as purchasing property and homeownership. Obviously, the costs here are as yet moderate comparative with other comparative business sectors in the United States. In a country experiencing where rents and costs have skyrocketed, Huntsville gives relief to proprietors and rental occupants. 

Occupation Growth and Security

To sum up, Huntsville, alongside numerous other southern business sectors. This creates an ideal climate for rental occupants.

In a post-COVID world, we’re seeing needs moving to support reasonableness, open air spaces, and positive environments. Huntsville possesses all the necessary qualities. 

Glad to share with you all Huntsville details… we have been here since 2018!

Father and son

Why Invest in Houston Texas

Houston, Texas is one of the hottest real estate markets in the country right now, luring droves of newcomers from California, the northeast, and other pricier real estate markets. 

From 2017 to 2018, the Houston area saw an average of 250 people moving to the region every day, a trend that has stayed mostly on track since then. There is no shortage of reasons to move to Houston. The city boasts major league sports, popular theater and museum districts, world-class dining, and is located fifty miles from the Gulf of Mexico, offering plenty of outdoor recreation. 

https://youtu.be/wCOPdZedPKY

On top of all that, Houston has a thriving job market. If Houston were its own country, it would rank as the world’s 27th largest economy. The city has more Fortune 500 headquarters than anywhere in the United States, second only to New York City.

Investing

Houston is known as the energy capital of the world, with 4600 energy-related companies in the city. Other major employers include Texas Medical Center, the Port of Houston, and NASA. In fact, NASA is such an important presence that Houston has been nicknamed “Space City.” Houston is a magnet for younger professionals especially, with the average age of Houstonians being 33 years old, making it one of the youngest cities in the US.

Along with its booming population, Houston has seen a booming real estate market. The Houston Association of Realtors reported a 24.4 percent jump in single-family sales last month, compared to the same time in 2020.

As Houston real estate agent Tiffany LaRose told Houston’s ABC 13, “We’re seeing things we’ve never seen before, multiple offers within an hour or two of properties being listed. People are waiving their rights to appraisals. They’re going 30, 40, $50,000 over the asking price and still losing out on those houses. It’s competitive out there.”

While that level of demand might dim prospective homeowners’ hopes, there’s an important silver lining: compared to the 20 most populous metro areas in the country, housing costs in Houston are 36.6 percent below average.

So while you’ll be competing with a lot of other potential buyers, the cost of buying in is far less than you’d see in other big cities.

Deal

From an investment standpoint, buying in Houston offers an opportunity to reap the rewards of rapid appreciation. Since 2012, the middle-priced tier of Houston’s homes has appreciated on average from $117,000 to $199,976, an increase of 71 percent, according to Zillow’s Home Value Index. Last year saw the eighth consecutive year of home price gains, and over the past year alone, prices rose by 5.2%. Zillow also projects a similar rise in home values over the next twelve months for Houston.

real estate investing

There are a couple of caveats to this robust market. Houston can be brutally hot and humid in the summer, and the region is vulnerable to hurricanes and flooding. Investors should mitigate this by checking the FEMA flood maps as well as getting adequate insurance. Of course, these drawbacks are offset by the opportunities Houston offers. In addition to the job market, affordability, and area attractions, Texans do not pay any state income tax. On top of that, the percentage of homeowners in Houston is only 42 percent, so investors will be able to tap into a huge market of renters. 

So, if you can brave the hot summers and the hot competition, Houston is one of the best markets in the country to invest in right now.

Best Way to Define Infinite Banking

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I best define infinite banking is it’s really our process. In creating private vault for you to use as your bank. And overall it’s a process, the vehicle that it uses his whole life insurance and its dividend paying whole life insurance is the product of choice on that. I specifically like from our multiple reasons that we’ll go over, but that policy then is you overfund it.

And in that way, it has a cash value that you can access your cash at any time via policy. That’s the overall concept. And as you pull that out, the money still continues to work in your vault or in that, in your account. And you’re able to deploy that elsewhere and pretty much have your money work in two places at once.

The way I personally use it, when I had a policy, when I first started to do $50,000 a year after a couple of years, two, three years, they had at least a hundred thousand dollars of cash value built up in there. I always try and keep my liquidity low in my bank. You never want to have too much cash making nothing, but that’s why the next money is in your infinite banking policy to cash value, where it’s making a nice little tax-free yield.

That the first component of why we like infinite banking so much when the money is in, I call this the government in pull, but it’s just for some strange reason. Yeah. Life insurance, your yields, there are tax free. That’s a place to store my liquidity. And then when I need to go into a dealer too, and I need to drain that liquidity, I have it, but at least it’s not sitting in my normal checking account savings account, not doing any teeth growth, the use of whole life insurance.

It has a guaranteed aspect of it. Current gross rate of that is, 4% that is about to change, but the policies are ranging from three, three, 3% to three and a half percent uncorrelated not tied to the stock market directly on some policies you may have. And you can be in control of that, of how much funds are correlated.

But one of the main benefits for investors that this is not correlated to the stock market protection, but it is a product. So there is a life death benefit portion of it. But in addition to that in states, it varies, but there’s also some liability. And bankruptcy protection with the cash value or the death benefit over policies.

Some of our doctor clients, what they like to do is they stuff a lot of cash in here mainly for this protection aspect, right? There’s all these different asset protection strategies out there. There’s not one that’s going to get you to trying to build your castle with multiple layers of protection and diversifying.

So by putting some money into life insurance policies, Think that one part of your portfolio. Yeah. And liquidity, that’s one of the main appeals for investors where your funds are not tied up. You have access to that and it, you would have access to it in the forms of policy loans. And that’s what keeps it also, tax-free where you have access to the growth and all of your policy.