How to compound real estate investing results with a little extra effort

If I could show you a way to compound your real estate investing results by investing a little extra effort over time, would you be interested? I know it sounds too good to be true but lend me your mind for a short while and I’ll explain exactly what I mean. For the past couple of weeks I have been reading Darren Hardy’s fantastic book “The Compound Effect”. Darren is a protege of the late Jim Rohn whose teachings have had a great influence on me. (I like to think of Jim as a great mentor I … [Read more...]

What to expect when you are investing – Houston 2015 Edition

Consider the following scenario: You are a successful professional and through hard work and living beneath your means you have managed to set aside some capital. Thus far, your career has been fine but you want something more. You wonder what might be possible if you were to invest the capital you have managed to save in real estate. Would it be possible to create enough of an income stream to achieve financial independence? Or  put a different way, can this investment lead to an income stream … [Read more...]

The fascinating paradox with long term real estate investors

There is this fascinating paradox I encounter regularly in our real estate practice. The overwhelming majority of real estate investors I have the privilege to help, fall on the conservative end of the investing spectrum. They are driven by unbiased logic, need empirical evidence and have a long term focus. If you haven’t left this site yet after reading an article or two, you can probably relate. But with all that focus on logic, numbers and the “long game” they still succumb to doubts that … [Read more...]

Should you sell your investment property? A comprehensive guide

If you are a real estate investor that purchased well-located investment properties between 2008 and 2012, you are faced with somewhat of a dilemma. On one hand, you have watched the value of your property rise significantly in recent years on top of any built-in equity you may have secured at the time of purchase. Not to mention that in this market properties sell in a heartbeat for full asking with multiple offers. So you look at the current market value, then look at your mortgage balance … [Read more...]

Regret > Loss

The current strategy most Americans use to save and invest for retirement is fundamentally flawed. In order to evaluate the effectiveness of any strategy in an empirical way let’s look at the final results.  Then let’s compare them to the results you employed the strategy to achieve. We will go through that very process using two well known and often quoted studies. First, a 2007 study performed by the Employee Benefit Research institute found that the average Baby Boomer had an average … [Read more...]

Why did oil prices drop in 2014

Last year, on the morning of June 12, the market price for a barrel of West Texas Intermediate Crude Oil was $107.12. When the ball dropped to announce the arrival of 2015, the price of oil did a spot-on impression and dropped 51% (to $53.45). As I write this article, the price sits even lower at $44.80. As you read through those numbers, you are probably asking yourself two critical questions: Why did oil prices drop in 2014? How will the drop in oil prices impact the real estate … [Read more...]

How to avoid “getting married” to a rate of return and a pyramid scheme story

The year was 1997 and the country was on the brink of civil war. Just under two years prior, several “investment” firms had appeared offering a very enticing opportunity: Invest a sum of money and in 90 days receive three times the amount. People could smell that something wasn’t right but they felt drawn to the easy profit nevertheless. So they started investing small amounts: $100 at first that became $300 in three months time. And the word started to spread as more and more people decided … [Read more...]

The curious case of the Houston real estate bubble – An empirical analysis

The Houston real estate market has been on fire over the past 18 months. Since the start Q2 of 2013, we have experienced double digit increases in sales as well as rising prices and rents fueled by low inventories and high demand. The gallop has felt incessant. Just when you might expect that the market will take a breather for seasonal reasons or otherwise, it keeps sprinting forward. So, in this market climate, it's no wonder that the hypothesis of a Houston real estate bubble has arisen … [Read more...]

Observations on income taxes on your free and clear investment portfolio

Many of the articles I have written on have originated from discussions with investors like you. A few months back, Robert - a regular reader and "subscriber" to our Blueprint strategy - made the following observation. One thing I have noticed though is that the income taxes I am paying keep increasing as the properties are paid off. Typically when you have a leveraged property the cash flow is completely tax sheltered by the depreciation. When the property is free clear … [Read more...]

How to increase velocity of money to turbocharge your investment returns

Fact: Every investor I've had the privilege to help has worked extremely hard to earn and save the capital required to make long term real estate investments. So it's no wonder that as an investor you want to put in practice strategies that maximize your return on that capital. But I have a slightly different take on this matter. Because I've seen first hand how hard many of you work to create that capital, we have a duty to make that capital work as hard as possible to help achieve your … [Read more...]

The invaluable lesson a Roger Federer video taught me about long term real estate investing

Roger Federer, arguably the best tennis player in the history of the sport, visited the Google campus in Mountain View a few weeks back along with his coach Stefan Edberg (one of the game's greats in his own right). During that visit, they put on Google Glass and shot a fascinating video that showed a tennis match from the perspective of these two great players. Take a look: As I was watching that video, an interesting thought crossed my mind. As good as Edberg was in his day, he never … [Read more...]