Are you considering investing in real estate? Not just buying your own house, but investing your money in properties to earn long-term returns. This book provides an in-depth discussion of various types of real estate investments, using as examples the author’s real-life experiences. A comprehensive method to analyze investments is presented, which includes the proper recording of revenues, expenses, and taxes that will determine the investment’s cash flow.
Six real estate investment strategies are discussed in detail. Each chapter shows how to evaluate the investment with a financial model that incorporates all aspects of the deal. Examples are given from the author’s investment history.
Are you considering investing in real estate? Not just buying your own house, but investing your money in properties to earn long-term returns. This book provides an in-depth discussion of various types of real estate investments, using as examples the author’s real-life experiences. A comprehensive method to analyze investments is presented, which includes the proper recording of revenues, expenses, and taxes that will determine the investment’s cash flow.
Six real estate investment strategies are discussed in detail. Each chapter shows how to evaluate the investment with a financial model that incorporates all aspects of the deal. Examples are given from the author’s investment history.
Chapter 1 :Â Â Â Â Â Introduction
Years ago in California, I bought a condo for “no money down,” a mantra popular then in real estate investment circles. I assumed the owner’s mortgage on a run-down condo in a suburb north of Los Angeles. I rented it to the first person that inquired, a single mother with a child and no job. She moved in and never paid a cent of rent. l soon learned that it is very hard to evict a tenant in California. After I spent six months pleading for rent, my company transferred me to Egypt. I mailed the deed in lieu of foreclosure to the mortgage company, then went to Egypt and licked my wounds.
As my wife and I were packing up, my agent suggested I buy a coastal house in Ventura for $280,000, as an investment to rent. I said no. The house is worth more than $1 million today. Moral of the story: I was a young, clueless real estate investor. I had no idea what I was doing and chose the wrong property to invest in.
In the following years, I read books and studied real estate investment. I was able to save money on my overseas assignments, where my housing and expenses were subsidized. Back in Dallas, Texas, I took a suite of courses and graduated from Champion’s School of Real Estate. Sylvanna also studied and then became a licensed real estate agent. Together, we began the second phase of our real estate investment career.
We had money to invest and wanted to try different strategies. Do a real-world experiment in investing and see what worked best. Along the way, we visited and viewed different properties, some in foreign countries, met builders and tenants, learned how to fix up houses, dealt with lenders, and lived a full and satisfying life. This book will try to convey some of what we learned as we explored different real estate investment strategies.
To evaluate real estate investments, one must use numbers. The investment analysis does not just consist of the sales price minus the initial purchase price. There are closing costs to consider, on both the buy side and the sell side. There is rental income and there are expenses when you own a rental property. There are tax benefits to owning real estate, including the depreciation of a rental property. These must all be considered in the final analysis of the investment. I share the spreadsheet analysis of each investment in this book and try to explain simply how the numbers work, in order to compare and scrutinize different types of investments.
We begin with a discussion of real estate principles, including the terms encountered when buying and selling real estate. The chapters that follow discuss the basics, like how to work with agents to locate properties, how to get a mortgage, and how real estate taxes work. The final chapters delve into six real estate investment strategies, their pros and cons, and how they might work. I hope you enjoy the book and find it useful.
Now, I am the first to admit that I am a novice to investing, but I intend to become a pro in the future. I wanted to read this book because I am particularly interested in real estate investing. In Six Strategies for Investing in Real Estate, Tom Phillips provides an in-depth discussion of different types of real estate investment. Buckle up and come along for the ride that can lead you to millions if done the right way.
Six Strategies for Investing in Real Estate is ideal for both the novice and experienced real estate investor. So, thankfully I did not have to roll my eyes and groan my way through the text because of expressions that went way over my head. The author has a sense of humor (dry though it may be), and I love that. I found something to smile about in the very first paragraph and believe me I empathize. Tom Phillips' approach is down to earth and straightforward and this will resonate with the reader. His candidness will be appreciated by most persons.
Phillips begins at the very beginning but he does not sugar coat what needs to be done. There is emphasis on strategic planning, thorough research, and risk management before you dive in head first. I guess he learned his lesson from renting to someone without a job (I just had to put that in, LOL). The author discusses six important strategies that any well thinking real estate investor will consider. Each of the strategies has a dedicated chapter and includes wholesaling, real estate investment trusts, vacation rentals, commercial real estate, rental properties, and fix and flip projects.
There are fifteen chapters in Six Strategies for Investing in Real Estate and they are well organized and offer insight into each of the strategies. The author provides real life examples from his investment history that will help the reader. Tom Phillips has done an excellent job of explaining complex topics in a way that both the novice and experienced investor can understand and he should be commended for that. Phillips also addresses common misconceptions in real estate that can sometimes derail the best of plans. This is a must read for potential real estate investors!