let’s talk : Real Estate GURU Workshops
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This past weekend I took a 3-day Real Estate Investment Workshop, and I have to tell you, going into it I was SUPER skeptical. You see these “guru” workshops advertised all over the place, and more often than not it turns out to be a scam to get you to pay more $$$ for the next level of learning. To tell you the truth there was a little bit of that this weekend, BUT the amount of value I got out of the non-salesy stuff was SO WORTH IT.
While I won’t call out the name of the workshop on here, I want to tell you a little about what I learned. If you’re interested in taking the class yourself, feel free to email me for the information (& no I am absolutely not paid to do that – just want to help spread the wealth!).
SO, as we do, let’s talk real estate, let’s talk REAL ESTATE “GURU” WORKSHOPS…
I am of the mindset, you can ALWAYS learn something new- you never know what you don’t know. So, I went into this class with an open mind. Over just 3 days we covered ALL of the following topics and honestly in great detail;
- How to set up your business
- Asset protection
- How to reduce your taxes
- Deal analysis
- Commercial real estate
- Rental income
- Screening tenants
- Tenant incentive programs
- Self-directed retirement accounts
- Raising private money
- Tax reform
- How to find the best deals
- Rehabbing properties
- Saving money on renovations
While we did learn about ALL of the above, I want to leave with you the three things that really stuck with me most this weekend;
FLIP to INVEST
- Use OTHER people’s money to flip (@ 8%-10% interest) & take that profit to invest in your own rental income (@12%+ return).
- Plenty of investors want to flip AND invest – and I am one of those! But I had NO idea how to do both. Unfortunately, I do NOT have a million dollars just sitting in the bank (or anywhere for that matter) that I can use to invest in my projects, so I was SO happy to learn how others are doing it.
- Raise private money to fund your flip – typically, private money lenders are more than happy with an 8-10% return here, especially because there are no fees involved with private money lending AND they have great collateral to mitigate their risk -a house!
- Now, let’s say after all is said & done YOU MADE A PROFIT – woo! You can use your profit to invest in a rental property and create passive income for yourself. When looking for rental properties, look for those that will provide you a 12%+ return.
- So, now I am sure you are thinking; if people know they will “only make” 8-10% lending you the money, but can make a 12+% return by investing in a rental – why wouldn’t they just go out and invest in a cash flowing property themselves? They DON’T WANT TO DEAL WITH IT! Maybe they don’t want to be a landlord, or they don’t know how to find a deal, or they don’t want a mortgage, or the headache of bad tenants, or maybe they are just truly looking for PASSIVE income. There are PLENTY of reasons why people do not want to own a rental property, and whatever the reason may be – that is okay, we all have different passions & goals! One thing I do know though, that brings almost all of us together, is that most everyone likes to make money, and that there are PLENTY of people out there who are more than happy with the passive returns that come from private money lending. So take it! That leaves more business for you flippers to do in the market.
INCENTIVIZE YOUR TENANTS
- A GOOD TENANT IS AN ASSET. Without a tenant, your property has little value, ESPECIALLY if it is a commercial property (commercial properties are valued based on the income they bring in).
- In the past, the only tenant incentive program I knew of was referring a friend or colleague to your apartment building and in return you could get some $$ off one month’s rent. But you guys, if you have a good tenant, that pays on time, that keeps the noise down, that keeps the house in place- YOU WANT TO KEEP THEM. So, why not reward them for being a good tenant? It may cost you some dough, however the risk of losing the good tenant could cost you SO much more.
- Okay so, HOW DO WE INCENTIVIZE OUR GOOD TENANTS?
- Discount a month’s rent, or give a free house cleaning, or even a gift card at the end of the year. Something to acknowledge that you like to do business with them. People like to be acknowledged.
- The D.P. Program: Down Payment Program & Debt Payment Program. Now this is a program I learned about from my teacher this weekend- for all I know he may be the only doing it as of now! While I do not have the capital to do this today, this is something I 100% aspire to be able to do and is truly a personal INVESTOR GOAL. These two programs allow you to help your tenants buy their own home one day by either helping them put money aside to save for their down payment OR helping them pay down student debt. Now as an investor, why would you want to do this? Well, aside from the gratitude that comes along with giving back, these programs ALSO come along with tax write-offs (if you are a business owner), with home sales (if you are a realtor), with rehab opportunities (if you are a flipper), and it helps more of the population become home owners. The more people that can afford homes >> the more competition there is out there for inventory>> the more competition there is for inventory, the more the property values increase >> the more the property values increase, the more YOUR property value increases. I definitely want to write an entire post on these two programs, discussing how they work, why they work, and the benefits for both you and your tenants so, be on the lookout!
PUT PEOPLE FIRST
- You guys, I am about to get a bit sappy, so let me preface this by saying I am not the Dalai Lama nor am I the worst person in the world either (in my opinion)- I am just a normal human being. You’re probably thinking “that’s dumb, obviously we should be good people, that’s easy”, BUT there are seriously so many bad landlords, or sneaky business owners out there who put profits first. If you work with integrity, it may cost you a bit more cash money in the beginning, but you’ll get THAT much more business in the end, when people want to repeatedly work with you, or refer you to their friends & family.
Over these next few months, as I do my own further research, I will touch on many more of the topics I learned about this weekend, so STAY TUNED!
Again, thank you so much for being a part of this and please know that I am open to any and all feedback on how this is structured, content, writing style, etc. As we go forward, I hope to make this more analytical, factual, and even just helpful as we all work to build our real estate portfolios.
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Data Sources for today’s content:
Notes from the workshop