We’ve all heard that you should diversify and that you should put all your eggs in one basket. But how do you diversify? There are four basic ways. When done well, your wealth will grow faster. Plus you won’t have to endure the stress of......
It’s been said that the size of your network is the size of your net worth. While it’s not a perfect correlation, let’s take a deeper dive on the key relationships a landlord needs. 1.) Realtor. Sure, you can find a deal on your own.......
The Invest and Transform YouTube channel has new videos every week. Check it out and subscribe. Go to https://www.youtube.com/@investandtransform Here are a few videos:...
A first-time house flipper spent 46 weeks renovating a house. He listed it for sale and soon received a strong offer from a buyer. The flipper was stunned when I said that he would have to pay taxes on his profit. I told him three......
The tax codes are generous to landlords, if you use what the IRS allows. These are the top rental property deductions that my wife Amira and I enjoy. Some landlords play great offense by charging market rents and minimizing vacancy. Some landlords play great defense......
How do you know if a particular property is a good deal? What analysis should you conduct? Anyone looking to build wealth through rental properties – whether they are single family homes, apartment complexes, or commercial buildings – needs to know how to calculate and......
What are economists saying about the real estate market for the coming year? We share the major takeaways here, and we included links to a number of predictions for residential and commercial properties. Zillow Zillow predicts residential housing prices will decline 0.2% nationally in 2024.......
I’ve been a full-time real estate investor for two decades, and I’ve heard this from so many people through the years: “The market’s too tough. You can’t find a deal.” Is the market too tough? Or are you not pivoting, adapting, and making enough offers?......
In 2008, I bought this brick 5-bedroom, 1-bathroom end-rowhouse with a tiny kitchen for $76,000 via a short sale. I borrowed $100,000 from a private investor. I had a few things fixed, put in new carpet, and had the interior painted. I thought I could......
In the over 1,000 real estate transactions I’ve been a part of, I’ve seen some doozies. I want you to learn from the mistakes of others (including mine!) without having to pay the price that others paid. I bought my first investment property sight unseen......
For aspiring homeowners and real estate investors, purchasing a multi-unit property has just become more accessible. Fannie Mae, one of the government-sponsored enterprises (GSEs) that plays a significant role in the U.S. housing market, has recently announced an exciting change in its lending polic...
In many cases, yes! Here is what you need to know. Lenders often expect a borrower to have at least six months’ worth of payments in reserve, just in case it stays vacant or becomes vacant later. If you have enough savings to cover a......
Almost everyone in real estate is talking about high interest rates. Interest rates are certainly higher than where they were two to three years ago. Are they high going back decades? The average mortgage rate going back to 1972 is 6.8%, so at 7.5% today,......
You’re an experienced house flipper. People see your success. Many want to flip houses like you do, yet they don’t do any deals on their own. Maybe they don’t feel they have the knowledge or the knack for finding deals. Perhaps they don’t have the......
Today on my 48th birthday, I wrote down a set of principles that run through my head on a daily basis. This is my gift to you. Love. Ask. Apologize. Forgive. Pray. Smile. Tai DeSa is a graduate of The Wharton School of the University......
It seems like the answer should automatically be, “Yes, give me my deposit back and terminate the contract for this money pit!” If your gut tells you to back out during the inspection contingency period, then do so…after doing a little more research on the......
Some people like the idea of buying a foreclosure but don’t actually enjoy the experience of buying one. A lot of investors and bargain-hunting homebuyers tell me that they want to buy a foreclosure. I ask, “Why do you want a foreclosure?” A common response......
Over two decades, I’ve consulted hundreds of people who were looking to buy real estate. Some were novice real estate investors, while others were looking to purchase a home to live in. Some people were just too afraid to buy a house. I recognize that......
Price only becomes an issue when value is not demonstrated. As a landlord, if you provide value to your tenants, they will pay for it. What are some ways a landlord can add value and increase revenue? When you offer more, you can charge more.......
Whether you’re an investor or a move-in homebuyer using mortgage financing, you’re probably wondering if you should buy now or wait for rates to go down. In mid-July 2023, the Mortgage Bankers Association reported that the average contract on a 30-year owner-occupied residential loan was...
It’s possible to find a real estate deal at an auction. It’s also possible to buy a bad deal. I bought my first investment property – a 5-unit apartment building in inner-city Philadelphia – sight unseen at an auction. The next day I bought a......
When I began investing in rentals in 2004, I remember multiple books and speakers stating that the minimum amount of monthly cash flow per unit should be $100. If you have a rental house and you’re bringing in $100 in free cash flow (rental income......
If you’re ambitious, there’s a gap between where you are and where you want to be. How can you close that gap as fast as possible? A lot of people make New Year’s Resolutions, yet most have given up by mid-January. Success is not really......
Maybe you’re a novice investor looking to snag your first deal. Perhaps you’re a house flipper who needs more properties to keep your crew busy. Or it could be that you’re looking to buy a 50+ unit apartment building in a new market to diversify......
Across the country, real estate values in most areas have gone up at least 40 percent since 2019. For those who had the foresight, resources, courage, and gumption to buy and hold real estate prior to 2022 – congratulations! You probably have a lot of......
Wealthy people plan for three generations. Poor people plan for Saturday night. The average American spends more time planning their annual vacation than they spend planning their investments. You can make a great living selling real estate. You can make a fortune owning it. Okay,......
Let’s say you’re a house flipper. You bought your fixer-upper and want to maximize your profit. Your buyer will likely need a mortgage loan and therefore an appraisal. The buyer’s lender and appraiser will need to see the value to justify the much higher sale......
There are investors who want to hold a real estate license, and there are real estate licensees who want to be investors. There are investors who don’t want to hold a real estate license, and there are licensees who don’t want to own real estate......
Depending on the type of property and perhaps the length of time you’re using it, it could count as an investment property. You’ve probably heard the phrase, “Your home is your biggest investment.” In one sense, that’s true since many people spend more money on......
So you’re thinking of selling one or more properties, and you thankfully will make a profit. How do you minimize your capital gains tax? If you’re selling your principal residence and you’ve lived there at least two out of the past five years, then the......
There used to be an unwritten rule that a landlord shouldn’t buy new construction. The belief was that you pay more for new construction, and why have tenants put wear and tear on a brand new home? Yet a housing shortage in many areas of......
Many investors start off by purchasing properties in their own name. It makes sense for a lot of reasons. Financing may have been easier. Perhaps they never envisioned they could own as many properties as they now do. Insurance may have been cheaper. Setting up......
Some amateur house flippers believe that all you have to do is buy a fixer-upper, renovate it, and then it’ll easily sell for a hefty profit. That’s not always the case. You could pay too much, get in over your head on the renovation, take......
Evaluate the cost of buying an investment property. And also evaluate the cost of not buying it. If you’re considering an investment property, it’s fairly simple to calculate the cost of buying and owning it. You can determine the approximate After Repair Value using a......
There it is: a low-priced fixer-upper with a decrepit in-ground swimming pool in the backyard. You snatch up this gem at a discount. So what do you do with the pool? Bring it back to life? Fill it in with dirt? It depends. If you’re......
Many people think in terms of price. The seller naturally wants something higher, and the buyer desires something lower. Yet to negotiate solely over price is simplistic and at times, costly. I knew a first-time investor who got into a bidding war on their very......
If you buy a 4-bedroom, 1-bathroom house, convert it into a 3-bedroom, 2-bathroom house. This principle applies regardless of whether you are a flipper or landlord. If you are a landlord, there is a larger pool of renters for a 3-bedroom unit versus a 4-bedroom......
The riches are in the niches. Find a need and fill it. Serve the underserved. A growing number of residential rentals and commercial office rentals are furnished or partially furnished. The broad appeal of Airbnb and VRBO, plus the popularity of working away from the......
The majority of landlords in America lease residential dwellings. After all, everyone needs a place to live. Some residential landlords eventually shift into mixed-use spaces, such as a building with a commercial space on the first floor and apartments above. Yet some landlords simply lease......
I did this a bunch of times in my early years as an investor. My first property was 100 miles away. I went to an auction for properties that had failed to sell when listed with Realtors. With a mix of naivete and bravado, I......
To prevent long-term high inflation, the Federal Reserve must engage in activities known as demand destruction. They must cool the economy, part of which involves slowing down the hot housing market. The housing market includes purchases of home and rentals. Current rent rates affect up......
Creative real estate investing broadly describes techniques to profit in real estate other than the traditional way of buying a property using cash or a purchase money mortgage. Creative real estate investing includes: There are even other creative real estate techniques. Putting together creative r...
I believe you should always leave a property better than the way you found it. When fixing and flipping a house, you have a golden opportunity to do that and make a profit. The key is to make a profit, and not every flipper does......
In my two decades of investing in real estate, I’ve known so many people who wanted to buy but never, ever did. You can’t win the game unless you get in the game. When you decide to buy a property that isn’t perfect, you learn.......
Yes! (Under certain conditions. I’ll explain.) With IRAs and 401ks, you could charged a 10% penalty for withdrawing money before age 59 and a half. Plus you might have to pay taxes on the amount of the early withdrawal if it comes out of a......
Leverage is a wealth multiplier for real estate investors. When you own a rental property with substantial equity that also has positive cash flow every month, you can borrow money against that property to go buy another one. Keep it up, and you can repeat......
Every week I get asked, “How would you invest in real estate if you only had $__________?” Today we’ll explore your options if you have $5,000 in savings that you’re willing to put into real estate. With only $5,000 to use, your options are limited.......
Most people overestimate what they can accomplish in one year and underestimate what they can accomplish in 10 years. It’s a new year and a chance to begin fresh. Many people make resolutions, yet data indicates that most people have given up on their resolutions......
A small percentage of real estate investors buy a home warranty. Why? Let’s examine the reasons. A home warranty is a policy that an owner pays for to cover appliances and various mechanical systems in a residence. For example, home warranties may cover the kitchen......
I’m not pointing fingers because I’ve done this in my younger days. What is it, you ask? It is assuming that just because you bought a fixer-upper means that you’re guaranteed to make money on the flip. I’ve seen so many aspiring house flippers make......
Ever talk to a dog owner who needs to find a rental? Odds are that you’ll hear that it’s hard to find a landlord who accepts pets. Immigrants who don’t speak English well can find it hard to be approved for a rental. Some may......
The holidays are upon us, and Black Friday sales can happen in real estate too. How much more of a deal can you get if you go under contract during the holidays? According to National Association of Realtors Chief Economist Lawrence Yun in this Forbes......
There are real estate investors who insist upon buying multi-unit buildings. Others say that single family homes make the best rentals. So what’s better? Let’s explore the pros and cons of each by comparing a 4-unit apartment building to four single family homes. The case......
What you focus on expands. If you believe that buying real estate now is foolish, you’ll look for reasons to support that belief. If you perceive that money and great deals are easy to find, you’ll keep looking and be pleasantly surprised at what comes......
You served your country. You want to build wealth through real estate. You don’t have a lot of money. Is there a way to invest in real estate? Yes! It is simple, yet it won’t necessarily be easy. Here is a path you can follow,......
The first house I bought was an all-brick duplex within walking distance of a university. The sellers had purchased it so their son – a student there – had a guaranteed place to live. They rented the other unit to college students so it more......
This week a house flipper backed out of their contract for a cash purchase, willingly forfeiting their hefty deposit. Another flipper ran out of money and has been laying off their full-time contractors. A real estate investor has been denied additional financing from their bank,......
Home price growth slowed by the largest amount on record in August 2022. [Nationwide price change chart courtesy of Lance Lambert of Fortune using data from Zillow.] Across the country, residential home prices are up year-over-year yet decreasing month-over-month. The S&P CoreLogic Case-Shiller ...
So you own a cash-flowing rental property with a sweet 3.3% interest rate and you have a ton of equity. You see there are opportunities to buy more real estate and want to pull cash out with a new mortgage loan, yet you think it’s......
I know landlords in their seventies with dozens of units that they still self-manage. I know landlords who never met any of their tenants. Through the years, I’ve heard all sorts of opinions from real estate investors. Statements I have heard from people who don’t......
Whole-tail is a fairly new term – a combination of “wholesale” and “retail.” It’s not the same as a wholesale deal. A wholesale deal is an A to B to C transaction. In a wholesale deal, a person called a wholesaler (person B) goes under......
Sometimes we stare so long at a door that is closing that we see too late the one that is open. – Alexander Graham Bell While the BRRRR (Buy, Renovate, Rent, Refinance, Repeat) Method has been around for decades, it really became a movement over......
Every week I get asked, “How would you invest in real estate if you only had $__________?” Today we’ll explore your options if you have $50,000 that you’re willing to put into real estate. The good news is that you have lots of options! First,......
In America, there are two tax systems: one for the informed and one for the uninformed. Both are legal. – Judge Learned Hand Many American adults spend more time planning for their vacation than planning for their wealth. The average person does not think about......
If I told you that you could have a fully rented, maintenance-free property with $50,000 of equity, $2,000 a month in rent coming in and a $1,000 mortgage payment, and all you had to do was take over the mortgage loan, would you do it?......
In your lifetime you will see every single asset class endure value drops of 30 to 70 percent. Rather than panic, you ideally want to have money available to buy assets at rock bottom prices. In the dot com bubble burst of 2000, tech stocks......
A hard money loan is a short term, non-conforming loan for investment or commercial properties that does not come from a traditional lender but rather a person or private company. The hard money lender accepts the real estate as collateral. Hard money loans are characterized......
Today on my 47th birthday, I wrote down a set of principles that run through my head on a daily basis. This is my gift to you. The #1 skill for success in today’s world is to be indistractable. Distraction erodes your ability to achieve.......
A number of experienced and novice real estate investors have approached me in the past six months to say they are waiting for interest rates to fall before they buy their next investment property. In the past year, mortgage interest rates have almost doubled. The......
In 2022, there have been heightened fears of a recession. A recession is defined as a period of temporary economic decline in which trade and industrial activity are reduced, typically identified by at least two consecutive quarters of negative Gross Domestic Product (GDP). The real......
Mae owns a house, and she has fallen behind on her mortgage payments. Her lender states that she owes $165,000, and the amount she could pay to make the loan current is $15,000. The monthly mortgage payment is $1,000. The house needs about $10,000 of......
I remember hearing Robert Kiyosaki state that an entrepreneur needs skills in sales, accounting, leadership, and investing. If an entrepreneur lacks skill in one or more of those areas, then that deficiency will harm the business over time. You do not need to be an......
It takes skill to find and negotiate a deal. It takes another type of skill to come up with the money to buy that deal. Here is a list of the types of financing available to real estate investors. Traditional purchase money mortgage loan. Also......
Investing in real estate does not have to be high-risk. One way to mitigate your risk is to calculate the After Repair Value prior to making an offer. How do you figure out the ARV when you’re sifting through numerous properties online? First, let’s examine......
Many investors believe that they need to buy a foreclosure to get a deal. Many of these investors also believe that properties listed by a Realtor are not deals. That is simplistic thinking. Sure, many foreclosures are offered at a discount to fair market value. ......
The residential real estate market, and some aspects of the commercial market, have seen incredible price appreciation in the past couple of years. The S&P Core Logic Case-Shiller U.S. National published on October 26, 2021 shows a year over year residential price increase of 19.84......
The best CEOs don’t ask themselves, “How can I do this?” The best CEOs ask, “Who can do this?” What is your time worth? Do you believe your time is worth $15 per hour? $25 per hour? $75 per hour? $125? $200? More? Just because......
I bought my first property, a 5-unit apartment building, in 2004 in an inner-city section of Philadelphia. I joined a local landlord association to learn from others. Several people there told me that they only did month-to-month leases with their rentals. I asked why. They......
Flipping a house can be a lot of fun. You go treasure hunting for a fixer upper. You put together your renovation plan, pick out the materials, transform the house inside and out, and then (hopefully) sell the house for a tidy profit. It feels......
Inflation worries abound right now. There is unprecedented liquidity in the market from all the government stimulus money and loose monetary policy from the Federal Reserve. The Fed has stated that the recent rapid consumer price increases are transitory, yet many fear that inflation will......
It depends. There are pros and cons to each. Everyone’s situation is different. Buying in your own name Pros: Financing is usually less costly due to lower interest rates and lower fees than commercial loans. Residential non-owner occupied mortgage loans are typically at fixed rates....
You may have heard some real estate investors talk about a 1031 exchange. A 1031 exchange is essentially taking the proceeds of an investment property sale and using it to buy another investment property, while deferring the capital gains taxes. A properly executed 1031 exchange......
Imagine earning an extra 67 percent of profit ($50,000 instead of $30,000) simply because you structured a flip transaction one way versus another. Some simple strokes of a pen on paper could make the difference in how much money you get to keep. Read on......
Imagine buying an investment property, getting tons of cash flow every month, creating tens of thousands of dollars of equity, and then getting all your original money back while having the privilege of still owning the investment property?! It’s like you created a money generating......
Your network is your net worth. Develop at least one new connection every single week. It could be to a handyman, a general contractor, a plumber, an electrician, or a painter. It could be a real estate agent, a landlord, a surveyor, an appraiser, a......
For many investors, the first deal is the toughest. I was consumed with fear on my first deal. There was added pressure because I had no other source of income and was operating purely on savings. I made numerous mistakes, big and small, on that......
A lot of real estate investors and agents have been asking me in recent days when there will be a wave of foreclosures caused by defaults due to the COVID-19 shutdown. The answer is, it depends. Some cities, regions, and states have been affected more......
To find solid rental properties to buy, you need to sift through a lot of potential deals. A must for a landlord is to have positive monthly cash flow once the property is stabilized. By stabilized, I mean that you have removed any bad tenants,......
Have you been using hard money to fund your investment deals? Or have you been working for years to build up enough cash to one day use the BRRRR (Buy, Renovate, Rent, Refinance, Repeat) Method to take your investing to the next level? Are you......
The big question from many short sale sellers in 2019 is, “Will I have to pay income tax on my forgiven debt now that the IRS mortgage forgiveness act is expired?” Here’s some background: Unless there is an exemption, the Internal Revenue Service has historically......
Great real estate deals don’t interrupt you. You must consistently search for them. The investors who find the best deals look daily. How can you search daily? Search for people selling their property For Sale By Owner via certain websites, like Zillow.com, Trulia.com, Realtor.com, or....
There was a time in my life when I was so broke – even though I owned some rental properties – that I couldn’t even pay for repairs over $200. So, when I did have a necessary repair to make, I would scramble to come......
When I first started in real estate investing over 15 years ago, I believed that I needed a special “investor contract” to make offers on properties. My intention was to have the perfect contract template filled with tons of clauses that were favorable to me......
When you find tired landlords, you can find solid real estate deals. When I refer to a tired landlord, I’m not talking about a sleepy landlord. I’m talking about a rental owner who is sick and tired of dealing with toilets, tenants, and termites. They......
An experienced house flipper, represented by an experienced broker, viewed a foreclosure that was listed for sale. The investor made an all cash offer of $28,000 with no inspection contingency for that bank-owned property. The offer was accepted, and the investor purchased the house.&nbs...
No. Well, maybe. Actually, yes, there are ways to buy an investment property with little to none of your own money by using a traditional mortgage loan. This is a way a lot of aspiring investors get started. So let’s say you have limited funds......
The complexity of tax brackets and tax rates can cause some people anxiety, yet it’s imperative that you know how taxes work. Knowledge about brackets, rates, deductions, and credits will help save you money come tax time. There are seven federal tax brackets created by......
Whether you own one investment property or dozens, you are the CEO of your own real estate business. As the CEO, it is your responsibility to protect your business, set a strategic vision, grow your income, and keep your expenses low. Therefore, you should have......
There are essentially three ways to find deals: prospecting, marketing, and networking. Prospecting involves searching for opportunities. It is a thorough examination of neighborhoods, pre-foreclosure and foreclosure lists, websites, and For Sale signs. Marketing is attracting the attention of poten...
“Thinking is the hardest work there is, which is probably the reason why so few people engage in it.” – Henry Ford In his book How to Become CEO, Jeffrey J. Fox writes, “Spend one hard hour every day planning, dreaming, scheming, thinking, calculating. Review......
You can invest in real estate with little to no money, or you can invest with lots of money (yours or perhaps a lender’s or partner’s money). You can conduct a quick flip where you never owned the property or owned it for as little......
Good tenants come to you not by accident, but by design. There are good tenants in every price range and in every neighborhood. A professional landlord will attract quality tenants. An unprofessional landlord will attract troublesome tenants. Below are some tips that may help you.....
Tip #1: Add a basic alarm system. The number one concern for any resident is security. If a homeowner or tenant does not feel secure, then eventually they will move elsewhere. Many security alarm providers have lucrative introductory offers for equipment and/or installation.&...
One of the greatest discoveries a man makes, one of his great surprises, is to find he can do what he was afraid he couldn’t do. – Henry Ford What are the risks in buying a short sale? Most short sales involve sellers who are......
It was supposed to be a simple transaction. Invest in a small fixer upper house, renovate it, rent it, and have the tenant pay the mortgage. The young couple had allocated $52,000 of their savings to buy a detached single family house as their first......
What is a straw party? A straw party relationship consists of a straw man (also known as a nominee or agent) and a principal (also known as a beneficial owner). A straw man has been defined to mean a mere conduit or medium for the......
Real estate transactions and interactions can be challenging. It’s not a matter of if, but when, a tough situation will rattle you emotionally, mentally, or physically. I find these quotes inspiring in good times and more importantly, in bad times. Just reading through these pear...
If you are buying, fixing, and flipping single-family houses – particularly starter homes – then you need to know about the Prohibition of Property Flipping Rule created by the Department of Housing and Urban Development (HUD) to prevent egregious predatory flips within the Federal Housing......
No. Well, maybe. Yes, if done a certain way. A loan insured by the Federal Housing Administration (FHA) is buyer-friendly, and it could be the ideal way for a relatively new investor to start their long-term path to wealth. First I’ll explain some of the......
The mistakes that experienced investors make can be different that the mistakes that novices make. Below are 12 common mistakes I see from those who own multiple units. 1. Not raising rents. I was shocked when a landlord told me that his tenant in a particular......
These are all mistakes that I have made, so I’m not pointing fingers. I urge you to learn from my mistakes. 1. Rushing to buy. In 2004, I called myself a full-time real estate investor yet I had never owned any real estate. With my hard-earned money......
I hear a number of people, from investors to agents to sellers, mix up these terms and situations. I will clarify the meanings while providing some insights on how to buy each. Definitions Short Sale (per REALTOR® Magazine): A short sale occurs when the net proceeds......
So many people ponder whether they should flip houses, or buy and rent out houses. We will examine the pros and cons of each strategy later in this article. Before deciding between those two distinct strategies, there are three questions to consider first: Why do......
The most important investment you can make is in yourself. Many people who created wealth in real estate did it through their actions during the evenings and on weekends. Below are some tips to maximize your experience at a real estate seminar. Know what you......
Flippers and landlords need to understand the four basic residential real estate cycles to tailor their investment strategy. 1.) Declining market. This is defined by increasing unemployment, a longer time on market of homes for sale, stagnant or decreasing sale pric...
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