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What the Houston real estate market recovery means for real estate investors

March 21, 2012 By Erion Shehaj Leave a Comment

The Houston Association of Realtors recently released the Houston real estate market statistics for February. In a nutshell, sales were up almost 16% year over year and February was the ninth consecutive month of increasing home sales. But you don’t have to read a bunch of data to know that the real estate market is very different this year compared to previous years since the 2008 recession.

Phenomena that had been all but forgotten since 2005 or so are coming back. Multiple buyers competing for the same properties causing bidding wars and driving up prices are becoming commonplace. Where listings would stay on the market six months to a year with no activity just a short time ago, now sales are happening in weeks not months. And this isn’t just an isolated local situation either: Real estate agents all across the country are gleefully reporting the same turn of the tide in their markets. Inventories keep shrinking: There used to be 7-10 months of inventory available on the market and now all of a sudden there’s 3-6.

Now, let’s be clear about one thing. During the recession in Houston, there were declining sales for over two years! Nine months of recovering numbers is a good start but that’s where it stops. We need to see if there will be continued strength in the market through the busy spring and summer seasons before we can call this a bona fide recovery. But at this point, at least in the Houston real estate market, it’s a matter of when versus if. It may take longer to reach a full bloom recovery than the numbers show at the moment but we will get there soon.

So what are the implications of a real estate market recovery on real estate investors? What do they need to look out for as they adapt from a stagnant market to a competitive one? How does the duration of low interest rates play into their overall strategy in the next 24-36 months?

Photo Credit: Peer via Compfight

More competition from owner occupants will make it harder to locate properties

If you are an investor that’s been actively pursuing properties in the first quarter of 2012, you have seen this implication with your own eyes. As more owner occupants get off the fence and start competing with investors for the same foreclosures, short sales and distressed properties, it will become even harder to be the winning bidder. Many distressed properties are government owned or administered and as such carry exclusive “first look” periods for owner occupants that eliminate a real estate investor from even competing for a set time. Besides that, owner occupants are looking for great deals as well – meaning homes priced below fair market value – but a good deal to an owner occupant doesn’t have to have as much built in equity as you need when you’re an equity investor. For example, if a home is worth $120,000 and priced at $90,000, the asking price is probably the highest price that would make sense to an investor whereas the owner occupant might be happy even at $100,000 or $105,000. So, competing under those conditions will be very difficult for real estate investors.

Cash investors seeking yield are entering the market in thousands

Not only do investors face stiff competition from more confident owner occupants, but also from fellow investors that are cash buyers and seeking strong returns on that investment. The banks and institutions that hold these properties largely prefer cash offers because they’re guaranteed to close and close quickly. There are no financing contingencies, no loans falling through, no complications. In the event that you have two equal offers – a cash and a financed one – the cash offer will always win the bidding. And cash buyers have an edge in this fight: Generally equity takes a secondary role since what they are looking for is primarily, yield.

Interest rates are only here for a limited time

Competition and the fight to acquire properties has always been a part of the game for real estate investors to some degree. Therefore the prospect of missing out on the acquisition of properties isn’t new either. Except that it’s more complicated that when you throw interest rates into the mix. A few weeks back, one of our clients locked a 4.25% interest rate on an investment property. Your rate may vary somewhat but that doesn’t obscure the fact that interest rates are a major factor in changing the fundamental numbers and the investing landscape. The problem is they’re only here to stay for a limited time. Bernanke said the FED will probably keep the rates at the same level through 2014. But that’s assuming that there won’t be an acceleration in recovery and a rise in inflation. Predicting the future isn’t part of my skills set, but I can tell you this much: The damage caused to your real estate portfolio’s returns by your inability to add quality assets to it in a favorable interest rate landscape will be much higher than the equity dollars you’re supposedly leaving on the table.

Continued strength in rental market and rising rents

While there is justified skepticism about the presence and strength of a recovery in home sales, the rental market has been bullish for the better part of three years. In the latest report from HAR, rental properties were up 21% over the same period in 2011. Meanwhile, from the trenches we can report that the average days on market in quality locations are usually under 30 with Landlords typically getting 100% of asking. In addition, properties that would rent for $1000-1100 in 2006 are renting for over $1350 every day of the week. This matters because you can choose to look at this from two different perspectives. The shortsighted view that looks at the short term metric of initial equity and nothing else. Or the birds eye view that sees increasing rents as a counterbalance that overcomes the former strategy’s returns over the long run.

Smart real estate investors have to think strategically and adapt to the coming change. Why would you choose to compete in an impossible landscape and settle for inferior left overs on purpose? It may take you 5-10 bids and the tens of hours wasted before what I’m telling you truly sinks in. And you’re more than welcome to go down that ride to see for yourself. But if you want to get about your business and add some crucial pieces to your portfolio in a favorable interest rate and rental market environment, instead of fighting the usual suspects for overpriced properties, listen up. Don’t participate and refuse to fish in the same river as everyone. Initial equity does not matter in a solid long term strategy despite what you may have been told. Quality does. Call my cell at 713-922-2702 and I will show you a different way to invest, to build wealth and retire. A way that’s based on a well thought out Blueprint and doesn’t involve fighting with newbies for overpriced inferior properties.

Why investing in condominiums does not work in the Houston market

March 19, 2012 By Erion Shehaj 10 Comments

In most real estate markets across the US, condominiums are the poster child investment property of choice. The reasons are obvious: They are small, easy to rent, usually well located and priced lower than their single family counterparts. So when our out of town clients come to Houston to view investment properties, the question never fails to arise: What about condos? What follows are three strong reasons why investing in condos in the Houston market does not make sense.

Higher operating costs hurt or eliminate cashflow

The primary reason why investing in condos does not make sense in the Houston market is their higher operating costs relative to the income they produce. Here’s what I mean in a simple example. Let’s compare two properties: The first is a single family home in a suburb of Houston and the second a Galleria condominium both priced at $135k. Let’s assume that they both rent out for $1200/mo to level the playing field. The single family home will have operating costs of about 40% of the incoming rent or $480/mo which covers property taxes, insurance, annual HOA dues etc. In comparison, the condo will have operating costs of about 60% or $720/mo. The reason: Houston condos typically have $300 per month in maintenance fees. Put a different way, a condo that costs $135k has similar costs to a $160-170k single family home. What does this mean? If you were to invest in the condo by putting 20% down, your positive cashflow would be wiped out by those higher costs and you would have a break even property at best. In contrast, if you invested in the single family home, there would be $3600-4000 annual positive cashflow – a 10-12% cash on cash return on your invested capital.

When you take cashflow off the picture, appreciation is all that’s left

So if your investment property isn’t producing positive cashflow then where will that return you hope for come from? All that’s left is appreciation. In other words, you would purchase an investment property that pays it’s own bills while waiting for its value to go up as your tenant pays your mortgage. Small problem with that plan: Houston has never been a high appreciation market. Even in the peak of the market, we were barely scraping 5% annual price growth. And besides, have you seen what happened to markets that did have that steroidal appreciation? I’ll take Florida condos for a third of the price, Alex. An investment plan that relies solely on your property appreciating in value in Houston Texas is two rungs above buying a Texas Two Step lotto ticket on the sound investment scale.

But what about location, location, location?

Condos have proven to be sound investments when they allow the real estate investor to acquire property in a sought after location and the tide of popularity of that location has made values across the board rise. Example: If you want to live in the city, chances are you can’t afford a single family home but a condo will get you all the benefits of that location at a much lower price tag. The Houston market is different in that it’s very de-centralized. Houstonians don’t mind commuting for 35-45 minutes each way if that means they can have all the space and amenities that a great home can offer. Certainly there’s a subculture of people that would never live outside of the Inner Loop, but that’s not the majority. Most people would rather live in the suburbs where schools and amenities are better and work Downtown or in the Galleria. This commuter culture results in a lack of land shortage that is a necessary ingredient for value appreciation. For instance, if you want to live in Manhattan, you have to pay the price as they’ve run out of land long ago. In contrast, in Houston you could get twice or three times the size of home if you just go out 15-20 miles. And if you don’t mind the drive, it’s a no brainer. And it’s bad news for condos as investment properties.

Bonus Reasons: Age and control issues

Some additional concerns with condo investments are the age and the lack of control in certain circumstances. Let’s tackle them one at a time. For the most part, condos priced low enough to break even on the incoming rent tend to be built in the 1980s. Age may do great things to wine but all it does to investment properties is cause the operating costs to creep upward which makes rent increases a necessity. Besides, if you are a long term investor think about the age of the property 10-15 years from now. Is it smart to own a property that when you want to sell it will be hitting the half century mark? I know some out of towner’s eyebrows might be raised right now, but you should know that in Houston, 50 year old properties are considered “historic”! Last but not least, condos present some unique control issues. What happens when a hurricane damages a condominium’s roof? Well you might be hit with an unexpected “special assessment” bill from the homeowner’s association that’s trying to offset the large deductible on their master insurance policy. Oh, and what happens to your tenant when the roof is leaking profusely but the Landlord can’t fix it right away because she has to wait for the homeowner’s association to reach an agreement with the insurance adjuster? Like the title said: pretty much out of control.

I’m a firm believer in taking what the market gives you when investing in real estate. And in Houston Texas the market gives you new (or 5 years old or less) single family homes in good neighborhoods with great schools between $125-$150k. Anything else, you’re sacrificing something you shouldn’t.

Search Houston Investment Properties

Side note: This analysis addresses condominiums as pure investments. If you’re looking into purchasing a condo as a residence, it may make sense as an investment because you have to consider the fact that you have a cost of living to contend with everywhere you go.

The answer to THE most frequently asked question by real estate investors

January 3, 2012 By Erion Shehaj 1 Comment

Today I want to start by making a statement that’s as powerful as it is obvious. The critical foundation for any long term investment strategy is incoming rent. Without it, all projections fall apart, all returns vanish. Earth shattering, I know. But obvious as it is, is it any surprise that THE most frequently asked question I get from all real estate investors without exception is: How do I know that the property will rent quickly and stay rented? This question deserves an answer that’s better than just encouragement: It deserves solid facts.

The experiment

So facts I went chasing to provide an answer that will show how the Houston rental market actually performed in 2011. I analyzed all rented properties that closed in 2011 that fit the property profile we recommend: Built after 2003, Minimum 3 bedroom 2 bath 2 car garage and at least 1600 SF zoned to the best school districts in the city for the money. The results themselves didn’t stun me as I see them in action in my business every day. Their consistency across the board however, really did. Take a look for yourself:

As you can see, the average time it took for properties in that category to get a tenant was between 33-48 days. When you consider that after closing on an investment property the first mortgage payment isn’t for at least another 30 days that ought to put a smile on your face. And when you add to it that the average days on market for the properties we listed for lease in 2001 was 24 days, that’s even more cause for comfort.

But days on market are just part of the puzzle. What if you’re getting your properties rented out quickly but you’re having to sacrifice large discounts off your asking price? That wouldn’t be good. Well, the data shows that the average sold to list price in all the school districts we analyzed was 99%! To put that in perspective, if you had an investment property and were asking $1200/mo in rent, the average discount in 2011 was $12. In our business we price the properties right from the beginning and always get our asking price or higher.

The Answer to the most FAQ

So how do you know if the investment property you acquire will get and stay rented? First and foremost you must not forget that it’s the right property that attracts the right tenants quickly. If your property selection is poor, getting the property rented and especially, keeping it rented will be more challenging. That’s why we remind our clients that numbers often lie and high returns can cloud your better judgment. Although chasing cheap properties in inferior neighborhoods with seemingly great rates of return may seem like a good way to score a great deal, those returns vanish if your turnover rates and maintenance costs are high. So, select the right property in the right neighborhood and finding and keeping tenants will be the least of your concerns. But you don’t have to believe me. The market told you so.

Do you have a real estate investing Blueprint yet?

7 Powerful Tips on investment property management

November 1, 2011 By Erion Shehaj 7 Comments Tags: Property management tips

The number one reason investors shun long term investing strategies is the perceived hassle of “landlording”. The concern is that this type of investment brings with it tenant calls at three o’clock in the morning, relentless maintenance, collecting trouble and the like. Since real estate investing success has as much to do with its return on investment as the overall investor experience, this is a valid concern that shouldn’t go unaddressed. So, I put together a list of 7 powerful tips to minimize the need for property management, eliminate hassle and increase your bottom line by saving on property management fees.

Property Management Tip 1: Buy New or Newer Properties

Most property management nightmares begin at the purchase. Seduced by “bargains” and equity, investors purchase three decade old properties with significant deferred maintenance and years of neglect. These “steals” often come with galvanized plumbing, electrical issues and air conditioning systems that have seen better days. Needless to say, these investors are setting themselves up for a bad experience that will often override any benefits brought by cash flow or captured equity. Instead, we advise our clients to purchase new or newer properties instead: Currently we don’t advise purchasing any properties built before 2005 (with some very rare exceptions). The reason behind this is that in a recently built home all major systems are also recent therefore less prone to breaking. Buy new (or newer) and avoid most issues that come with older properties.

Property Management Tip 2: Screen your Tenant well

This has to be both the simplest and most important property management tip in this list. Often in a rush to get the property occupied as soon as possible, investors will skip through the tenant screening process. Big mistake! The screening process uncovers whether or not the tenant has the financial ability or employment stability to afford the home or whether he/she has been a responsible tenant in the past. Inexperienced investors often view the tenants ability to afford the rent as the tenants problem, until it becomes their problem. In our practice we thoroughly screen tenants often rejecting several applications before accepting one that works. And that ends up being a win win for everyone: Our clients get a tenant that pays on time and takes good care of the property and the tenants get into a property they love and can comfortably afford.

Property Management Tip 3: Require Bank Deposits for rent payments

The advancement of banking technology in recent years can help real estate investors collect rent effortlessly and keep their tenants accountable faster. It used to be that tenants would mail a check which the landlord would receive and have to make another trip to the bank to deposit it. If a week passed and the rent check wasn’t there, the landlord would call and be told the check was in the mail. Ten days later, still no check and the tenants were then facing a situation where they would have to pay two months rent in quick succession so they’d skip out and rent a different property somewhere else. No more. Now we advise our clients to require that the tenant make a bank deposit or transfer straight into the landlords account. The tenant gets a deposit slip which serves double duty as a receipt and the landlord can log on to their Online Banking to make sure the deposit was made. If rents not there, it wasn’t put there and the landlord can hold the tenant accountable faster and collecting faster. Then, if the investor has their mortgage payment automatically deducted from that same account, they have a seamless system in their hands.

Property Management Tip 4: Buy and keep a home warranty policy at all times

Home warranty policies are an investor’s best friend. They work like an insurance policy: The client pays an annual premium (typically $300-400) and the home warranty company covers all major systems like the HVAC, plumbing, electrical, appliances etc. For every service call, there’s a $50-65 service charge and the rest is covered. So say the A/C stopped cooling: The tenant would call the 1-800 number for the home warranty company, they would send in a service technician next business day, the repair would be completed and all that would be owed is the minimal service charge. Having a home warranty only works seamlessly if you follow Tip #1 and buy a new or newer property. If instead your AC system was installed when Reagan was president, the home warranty company can decline coverage based on pre-existing condition. But this strategy has worked amazingly well for our clients. But what it the tenant has a knack for arranging service calls for every little thing? That issue is solved by our next tip.

Property Management Tip 5: Include a reasonable repair deductible in the lease

You want to make sure that the tenant has a vested interest in maintaining the property well. One way to do this is to always collect an appropriate security deposit. Another is the include a repair deductible clause in the lease. Typically our clients request the first $100 of repairs to be covered by the tenant (except on those repairs mandated by law to be covered by the Landlord in entirety). This ensures that the tenant doesn’t call you for very minor repairs every other day and it aligns the Landlord’s and Tenant’s interest in proper property preservation. Also, this clause when combined with Tip# 4 above, allows for repairs to be fully completed without the investor having to hear about it or pay for it as the deductible would cover the service charge for the home warranty.

Property Management Tip 6: Setup a separate phone number for repair calls

In an attempt to be helpful and accessible, investors often provide their home or mobile phone information for repair requests to their tenants. This inevitably leads to those infamous phone calls at 2am. There’s a better way. It starts with educating the Tenant on how the process should go once there’s a repair request. The investor needs to clearly communicate that the fastest way to take care of the issue is to call the home warranty company directly and setup a service call. For other concerns, the investor should setup a dedicated, separate phone number. This doesn’t need to be a physical line – instead it can be a virtual phone number through Google Voice. This service allows you to get a free local phone number with voicemail. If the the tenant calls and leaves a voice message, that message is automatically transcribed and emailed to the investor. If the issue is truly an emergency, the investor can take immediate action. If not, they can choose to address it the following day on their terms. Having a dedicated, virtual phone number puts the investor in control and minimizes hassle.

Property Management Tip 7: Use a-la carte vendors as needed

Sometimes, even after taking all the necessary precautions and doing everything right, investors often find themselves in a position where they have to deliver a notice to vacate or proceed with eviction. The process can be arduous and frustrating but the good news is the investor doesn’t need to be involved in it. In every market, there are companies that offer these services on a need to do basis. Need to deliver a notice to vacate? You can pay $59 and have it delivered for you. Need to follow through with eviction? $500 will get it done. The crucial point is that you are only paying for these services if and when you need them. Instead, if you hire a professional management company, you will pay a portion of your gross rent every month whether anything needs to be done that month or not.

Hope you found these tips as powerful as I’ve seen them to be in my practice. But in the end, self management, just like professional management isn’t for every one. That decision depends on many factors: location of investor, number of investment properties, and investor inclination.

If there any any property management concerns you would like me to address, please comment below and I will be happy to help.

Weaving real estate investing magic: Crafting a Blueprint

October 31, 2011 By Erion Shehaj 8 Comments

Last week, I wrote a “meat and potatoes” post where three Houston investment properties in premium locations were dissected and analyzed thoroughly. (Read that post if you haven’t already. I’ll wait). Their locations were stellar: excellent schools, amenities and access. The numbers were solid: Positive cashflow, cash on cash returns between 8-10% and cap rates north of 7%. But anyone who reads this blog knows where I ultimately stand on this. It’s not about the properties. Real estate investing is all about the strategy. Here’s what I mean.

Real Estate Investing Before Blueprint

Let’s assume you purchased those three properties I analyzed in that post. To make the calculations simpler, we will assume they’re purchased at the same time. Let’s look at what was accomplished. Roughly $100k was invested ($86.5 in down payments + closing costs) to acquire a portfolio worth $432.5k which yields $8,855 in positive cashflow annually. Basically, this translates to a 9% return on investment: beats the hell out of your neighborhood bank’s CD and the stock market minus its bipolar volatility. The investor’s portfolio is expected to be paid off on your Lender’s schedule in 30 years. At that time, it will consist of three paid off 35 year old homes cashflowing at about 7% of whatever the properties are worth then. In the meantime, your cashflow amounts to little more than a nice bonus/part time income that can support your latte budget, a light bill and a couple of dinners out. So one may think: This strategy doesn’t work! To which I reply: What strategy?!

Real Estate Investing After Blueprint

It all begins with addressing The Timing. Any long term real estate investor is ultimately after cash flow but the real question is When. The overwhelming majority of clients with whom I have this conversation quickly realize that they don’t need the cash flow right now but instead, are looking to build enough cashflow when they arrive at destination. If that’s the case, then what could be accomplished by putting current cashflow to work to bring the destination closer and arrive at a paid off portfolio on your schedule? Glad you asked. Take a look at this (click on the image to see full size):

Meat and Potatoes Oct 21 Blueprint — Click to see full size

What just happened? I crafted a Blueprint investment strategy with those three featured homes using painfully simple but time tested principles. Since the investor doesn’t need the cashflow at the current time, we apply it to the mortgage balance on one of the properties while making the regular payment on the other two. In addition, I advise my client to add $500 from her monthly income as additional catalyst. The goal is to pour gasoline on the fire and obliterate that mortgage as fast as possible.

The result: The first property is mortgage free in 68 months – that’s a little over 5 and half years! What follows is an imitation of what happens in an avalanche. Since the first property is now paid off, the mortgage payment on that property now gets added to the cashflow with which we attack the mortgage on the second property. Since we are hitting it with even higher principal payments, that property is paid off in just 38 months. Rinse and repeat on the third property and voila: the last property is paid of in 35 months.

Moment of Truth

Let’s examine the difference that a well crafted strategy can make. After executing the Blueprint strategy, the investor would “arrive” at a paid off portfolio of properties worth $432.5k (at a very conservative zero appreciation) in 141 months (under 12 years). At that point, the annual positive cashflow would be $30k/year if rents didn’t go up one penny in 12 years. That folks, translates to a 19% annual return on $157k invested every year thereafter. The investor was able to just about triple that $157k in those 12 years leaving appreciation completely out of the picture. Skeptical about the numbers? Email me and I will send you a spreadsheet to look over.

Flexibility

The above analysis assumes perfect execution. But circumstances aren’t always perfect. Don’t want to invest the extra $500/mo? It will extend the journey by three years but lower your capital invested by 40%. So it’s a matter of what’s most important to you, time or money? Want to hold on to the cashflow for a month to ride through a temporary vacancy? You can totally do that. Cashflow of $30k/year is nice but won’t quite cut it? We can increase the asset value from which that cashflow is drawn by acquiring one or two additional properties. This concept is so powerful that detours may change it’s variables, but if you commit to execution, you will look back and won’t be able to stop smiling.

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I can craft a Blueprint investment strategy for you, too. Give me a call at 713-922-2702 and I will get to work. Make this a great week!

How to be successful

October 19, 2011 By Erion Shehaj Leave a Comment

Success is simple. There are a handful of time tested principles that when followed consistently over long periods of time will inevitably cause you to succeed at anything. The funny thing is I’m not about to tell you anything you don’t already know. So then, why do successful people make up such a small percentage of our society? Because while these principles are painfully simple, they aren’t by any means easy.

Photo Credit: Alosh Bennett via Compfight

Success Principle #1: Figure out “why”

If you open a business because you just want to make lots of money, you usually don’t. People that just want their jeans to fit a little better don’t lose weight and keep it off in the long term. The Why is the driving force behind your actions that will push you through when you get stuck. When I meet with a real estate investor for the first time, the first question I ask is why they want to invest. Their first reply usually has to do with semantics: I want another stream of income or I want to build some wealth or I want to take advantage of this market. But when I ask them to dig deeper they find that they’re doing it because if this succeeds their daughter’s college will be taken care of or because they’ve always dreamed of traveling the world with their spouse someday or because they don’t want to end up relying on Social Insecurity (h/t Dave Ramsey) like their parents had to. There’s always a deeper purpose and if you want to be successful, stop here, figure out the why before you worry about how.

Success Principle #2: Have a Plan.

This sounds like a principle straight from the “Duh” Files but it’s amazing how many people are hopelessly pursuing something and they have no clue what. If you don’t know what your Point B looks like even Garmin can’t help you find the way! When it comes to success, vague is the enemy. Know your destination: Set goals and measure progress. Dave Ramsey says goal(s) should be specific, measurable, written, time limited and personal. You will be amazed at what you can achieve if only you sit and write down specific goals, set a deadline for achieving them and measure your progress on the way there. As a real estate investor, having a plan makes the difference between a six figure retirement and just buying a couple of houses for cashflow that couldn’t support your latte habit. That’s why The Blueprint is the cornerstone added value that we provide to our clients. Without it, you’re just making it up as you go.

Success Principle #3: Focus

The power of focus is immense. I am sure you’ve heard stories of people achieving amazing feats by focusing on their goal with intensity. The problem is we live in a society with the attention span of a chicken. We can’t do just one thing anymore. We have to be checking email, playing a silly game, updating our Facebook status and saving the world all at the same time. You don’t believe me? Go to a restaurant, any restaurant and observe how long people can go without checking their smart phones. We can’t even focus on feeding ourselves or just having a conversation, anymore. Don’t let circumstances dictate your actions and turn you reactive. Once your investing plan is in place, you focus on execution. Avoid analysis paralysis, pull the trigger and bring your plan to life. You’ll be happy you did.

Success Principle #4: Do 20% Work

Most people do work that doesn’t really matter. Pareto’s 80/20 principle says that “for many events, roughly 80% of the effects come from 20% of the causes”. Put a different way, 20% of what you do will cause 80% of your results. Do that work and avoid busywork like the plague. Kill or outsource everything else and you’ll never look back. For real estate investors, that means working with a real pro and entrusting them with providing you the data, information and analysis you need to make a decision. Your 20% work is executing your plan – the rest is just distraction.

Success Principle #5: No shortcuts

This principle is by far the most important. In the words of Beverly Sills: There are no shortcuts to anywhere worth going. Know the why, make a plan and execute it. Any attempts to short-circuit the process undermines the results every time. Human nature loves shortcuts: Diet pills to lose 100 lbs in twelve minutes, “proven” systems that will make you a zillionaire by Wednesday, you name it. The truth? You have got to work hard for results that matter and last. Want to change your life and get healthy – you have to eat less and exercise more. Want to be wealthy – you have to spend much less than you make and invest the surplus long term. Captain Obvious would roll his eyes listening to this. But remember, success is simple. You already know all you need to know to win. You just have to execute. It’s simple but not easy.