Elliot's Blog

Confucius Guide to Real Estate Investing!!!!!!!!!!

Elliot Caldwell, Broker (Gentry Realty) — Mon, 12 May 2008 18:07:38 -0500

Confucius Guide to Real Estate Investing

by Elliot Caldwell

Real Estate Education can be fun, simple and colorful while becoming a millionaire!

That is what investrip.com is all about. Have you ever asked yourself where do I get started in real estate or how can I keep going? If you are still trying to ask those questions look no Further, because we can help and we care! ***WARNING*** If you are not serious about making money in Real Estate don't read this article. Seriously stop now.

1^st Educated Yourself {keep it fun!}

To know is to know that you know nothing. That is the meaning of true knowledge. ~ Confucius Quotes

Many people Jump into real estate without getting educated because they want to get rich quick. Those individuals are impatient for the most part. Hey to all funny guys out there... Real Estate Investing is not a get rich quick scheme, BUT the closest thing to it is logging into investrip.com daily.

Many Investors believe they know everything there is to know about investing in real estate. I made that mistake and it cost me dearly. It would have been better for me to spend the money I lost on education. Fortunately, I did learn some important lessons in my mistakes. I would say the most import lesson I learned is to educate myself. Unfortunately, education can be boring, and most individuals teach real estate the boring way. That is why we have created investrip.com to make things fun and to shake things up in the Investment Real Estate industry!!

2^nd KISS (keep it simple stupid)

...or as my business partner Jacob Ash would say, KISS (keep it simple silly)

Life is really simple, but men insist on making it complicated. ~ Confucius Quotes

Investing is not a complicated thing, it is actually really simple, just takes some time and patience and you can learn everything there is to know. People being complex in nature tend to make things complicated. That is why many investors seek the complicated deal or the deal they think to be a secret. Please don't be the guy that says... when you have that really good buy call me up. A great deal comes along every day. Its Crazy the things I have seen people do for a deal that really wasn't a good deal at all. The goal for investrip.com is to keep things simple. Everybody is in a different point in there lives and not every investment is going to be the same for everybody. I also suggest putting together a team of experts to help guide you through investing in real estate. Where can you find the experts and knowledge you need? Of course at investrip.com, look no further were here daily to stay. Here are a few KISS definitions:

Real Estate: Land & Buildings

Cash flow: Total Annual Income - Total Annual Debt = Cash flow

Equity: Current Value - Loan Amount = Equity

Appreciation: Current Value - Original Value = Appreciation

Appreciation rate: (Current Value - Original Value) / Original Value

Capital Gains: Selling Price - Purchase Price (less improvements) = Capital Gains

Leverage: Doing more with less money. Purchase the entire property with only putting down a small percentage of money, and you borrow the rest.

3^rd Take Action

The essence of knowledge is, having it, to apply it; not having it, to confess your ignorance. ~ Confucius Quotes

A part of the learning process is actually taking action. Once you know everything there is to know, put together a team of professionals and go out and buy a property or two. There are tons of Professionals out there that want to help you make that 1^st step. On investrip.com we are going to have many different real estate specialists teach on different subjects. These will be individuals that have experience and passion about what they do.

4^th Keep Learning

Learn as though you would never be able to master it; hold it as though you would be in fear of losing it. ~ Confucius Quotes

Don't be stupid and think you know everything there is to know about real estate investing. You always need to continue learning. The real estate market is always changing and the economy is always changing. There are some principles that will always remain the same but there is always variable change. investrip.com will always bring you the latest information about the current market & Sub-Markets. I admit that no one has a crystal ball, so there is always an element of risk. No one can ever be 100% sure of what is going to happen in the market. I have personally made hundreds of thousands of dollars doing the opposite of what market experts have told me to do, so don't always rely on one source. Always, always keep learning!

Inve$trip.com {Coming soon}

Leverage Yourself!

Elliot Caldwell, Broker (Gentry Realty) — Tue, 06 May 2008 18:06:30 -0500

Word of the day: Leverage

In finance, leverage (or gearing) is using given resources in such a way that the potential positive or negative outcome is magnified. It generally refers to using borrowed funds, or debt, so as to attempt to increase the returns to equity. -Wikipedia

Leveraging is such a great tool and it enables use to do more with less money. The Great thing in real estate is that we are able to use other people's money to buy real estate. The banks love to give us there money because they know that the asset will grow/appreciate, plus if you default they have something to cover themselves with. It is hard to lend money for a business idea or a certain stock that you think will do well, but to lend money from a bank for a real estate deal is simple.

Investrip.com {coming soon} real estate investment education

Wealth!! Money!! Riches!!

Elliot Caldwell, Broker (Gentry Realty) — Mon, 05 May 2008 19:04:52 -0500

Wealth is a worthy goal for everyone to achieve. It would give a lot of people peace of mind to know that they could stop working and money would continue to flow into there bank account. Work gives us all a since of accomplishment and something to get up for each and every morning, but at the same time it would not hurt to have money to flow your way when you are on vacation or when you are sick. Ask Yourself, If I stopped working today how long could I go without having to work another day? The funny thing is most people do not know the answer to this question

Wealth - As defined by Buckminster Fuller, it is the number of days you can survive without working, while still maintaining your same standard of living

I like being in Real Estate for so many reasons. One reason is because being a real estate agent is like starting your own business where you call all the shots. You decide how much money you want to make. The other reason I like Real Estate is because you are always exposed to great real estate deals. Buying Real Estate is a great way to generate extra Cash without having to work. It's called Cash Flow.

Cash Flow - Total Income - Total Debt = Cash flow / this can be either positive or negative. This does not include appreciation (thats a bonus)

There are a lot of real estate deals out there currently where you can create cash flow opportunities. I highly advise all agents to learn investment real estate and to also buy a few investment properties in there lifetime. It will help you understand what your investor clients want and also help you create wealth/cash flow.

The List - Here is something everyone should keep in their pocket to review every day. We are all forgetful beings

Work

1-2=3

•1. Current weekly income (Had to go to work for)

•2. current weekly debt (Current spending/Current life style)

•3. current weekly profit (Cash received that can be applied to saving/investing/spending)

Money should be reviewed weekly not monthly (what are you going to do to make more money this week?)

Wealth

Not Wealth - Total money invested in (Real Estate / Stocks/ Businesses/ Etc)

Wealth - Current weekly profits/cash flow/interest/etc earned by the money invested.

Wealth is not the money that you put into your businesses/real estate/ etc. It is the money earned from those ventures. That is the measure of your wealth. So look at your weekly profits from your businesses/real estate/ stocks/etc (where you didn't have to be there to work)

That is wealth!

How wealthy are you?

investrip.com - worlds best real estate educational website

Elliot Caldwell, Broker (Gentry Realty) — Fri, 02 May 2008 13:49:26 -0500

I am a Realtor/Broker out of Mesa Arizona, and work mainly with investors. My specialty is investors and all I do all day is try to find good deals for my clients. I network with a lot of out of state agents who refer me business, and I am looking to work with more agents as time passes. If anyone out there has a client who wants to buy an investment in Arizona I can help. You can email me at elliot@gentryaz.com I also come across clients that want to buy in other states and I would love to refer them to you, where ever you might be?

Right now is a great time to buy in Arizona (depending on the area) I have actually seen some neighborhoods have a price increase, and others not so much. There are a lot of Opportunities right now and real estate is defiantly on sale! Lending at the time may be a headache, At least from what I have seen, but the interest rates are great. Many of my investors cash flow with 15% down, which makes them happy. I also have developed some special relationship with Builders/Developers which makes negotiating for my investors easy and I can get special pricing. It's funny how the builders are now my friends, where back in 2005 they were my enemyJ

One Last Thing

Right now I and another company are developing a website/blog that is for real estate investors. Its going to be a website that provides a lot of real estate knowledge, and also an occasional deal. It's going to have real estate tools for investors and instructional videos as well. We are going to cover every aspect of real estate investing, but at the same time make it fun & easy. I want to create a community of real estate investors and also a community of realtors that work with investors. We are looking for agents that know investment real estate, and we want them to be apart of our community. The website is not yet out, but it will be coming soon (3 months) it is called Investrip.com don't try to go there just yet because nothing will be there. If there is anyone out there that reads this and has some good ideas please contact me, or leave a post. Thanks

Active Rain’s Best Kept Secret!!!!!

Elliot Caldwell, Broker (Gentry Realty) — Wed, 12 Mar 2008 16:51:24 -0500

I have started a group called "Investment Intelligence" and I wanted to invite others that are interested in sharing real estate investment information. There is a huge market out there full of investors. 99.9% of my business is selling to investors and buying investment properties. I love the active rain and I want all those that are active in investing or selling to investors to share there ideas here at the Investment intelligence group.

5 Year Retirement Plan

Elliot Caldwell, Broker (Gentry Realty) — Mon, 25 Feb 2008 22:24:46 -0600

Retire Early... Invest In Out-Of-State Rental Properties!

5 Year Retirement Plan
Retire in 5 years with an income of $90,000 to $110,000 per year tax free for the rest of your life!

Purchase 10 out-of-state properties valued at $150,000 each, owning $1,500,000 in real estate. Each property would cost you $4,500-$10,000 for a total business investment of $60,000-$85,000. Let the properties incubate for 5 years, then pull out the equity of your two best properties and retire making $95,000-$110,000 a year tax-free forever. This great plan doesn't even include the awesome benefits of cash flow, increase of rental income each year, principle pay down and tax sheltering.

Working The Numbers...

Using 7% appreciation rate (national average) and multiplying by $1,500,000 in property.

Income
First Year = 7% x $1,500,000 = $105,000
Second Year = 7% x $1,605,000 = $112,350
Third Year = 7% x $1,717,350 = $120,214

Fourth Year = 7% x $1,837,564 = $128,630
Fifth Year = 7% x $1,966,194 = $137,634

Return on investment first year is 175%!

In Five Years, You Will Have Made $603,828
In Ten Years, You Will Have Made $1,450,728

Pull Out The Money
Do a cash-out-refi on your two best properties (borrow 90% of the equity).

Years One Property Two Properties

5th Year $45,000 - $55,000 $90,000 - $110,000
6th Year $45,000 - $55,000 $90,000 - $110,000
7th Year $45,000 - $55,000 $90,000 - $110,000
8th Year $45,000 - $55,000 $90,000 - $110,000
9th Year $45,000 - $55,000 $90,000 - $110,000
10th Year $45,000 - $55,000 $90,000 - $110,000

You now have a tax-free income for the rest of your life of $90,000 - $110,000 a year from your initial investment of $60,000 - $85,000.

Note: National appreciation average is 7%; at this rate properties will double every ten years.

New homes starting at $95,000
$4,750 Down payment @ 5% buys you a new house
Builder's will pay 2% of the non-recurring closing costs
Rental Ready Package ... All new homes include front and backyard landscaping, window coverings, refrigerator & stove and garage door opener
Strong appreciating markets where properties are projected to double in value in 5-10 years
Properties are located in great rental markets
Positive cash flow to breakeven properties
Property management will take care of your investment at a discounted rate
Invest out-of-state where the numbers make sense

She is beautiful!!!!!!!

Elliot Caldwell, Broker (Gentry Realty) — Sun, 24 Feb 2008 23:48:49 -0600

She is beautiful. That's right I am talking about the market. It is a beautiful market. It is amazing how cheap you can get homes here in Phoenix Az. I have homes that are in the low $100's that are Single family average sized homes. I have had so many calls lately from investors that are starting to get it. They can purchase a home and only put 10% to 20% down and cash flow. The lending has definitely tightened up here, but that is not necessarily a bad thing. Why? Because my investors are not getting into silly loans that they cant handle. I am not sure when the market will turn around, but I hope that it stays this way for a long time because I want real estate to be this cheap forever.

Give me a call if you are an out of state agent and need a contact here for the Arizona Market. I love to work with out of state agents. I specialize in investment real estate.

5 Year Retirement Plan

Elliot Caldwell, Broker (Gentry Realty) — Wed, 20 Feb 2008 15:30:16 -0600

This is regarding the 5 year retirement plan blog that I posted. It tells people to buy the properties out of state, but you necessary do not have to do that. You can buy good deals in any state. Just don't think that you can only get good deals in town, you should try to keep an eye on all markets. No two investors are the same, each have there own goals, so you have to evaluate which property and also which market will work for you at the time

Real Estate Investment Books

Elliot Caldwell, Broker (Gentry Realty) — Tue, 19 Feb 2008 17:36:27 -0600

I have read many real estate books from A through Z. I wanted to get a few recommendations from other real estate agents. Please post your favorite real estate investment books and why you like them.

5 Year Retirement Plan

Elliot Caldwell, Broker (Gentry Realty) — Tue, 19 Feb 2008 12:32:44 -0600

Retire Early... Invest In Out-Of-State Rental Properties!

5 Year Retirement Plan
Retire in 5 years with an income of $90,000 to $110,000 per year tax free for the rest of your life!

Purchase 10 out-of-state properties valued at $150,000 each, owning $1,500,000 in real estate. Each property would cost you $4,500-$10,000 for a total business investment of $60,000-$85,000. Let the properties incubate for 5 years, then pull out the equity of your two best properties and retire making $95,000-$110,000 a year tax-free forever. This great plan doesn't even include the awesome benefits of cash flow, increase of rental income each year, principle pay down and tax sheltering. Call us and get started today!

Working The Numbers...

Using 7% appreciation rate (national average) and multiplying by $1,500,000 in property.

Income
First Year = 7% x $1,500,000 = $105,000
Second Year = 7% x $1,605,000 = $112,350
Third Year = 7% x $1,717,350 = $120,214

Fourth Year = 7% x $1,837,564 = $128,630
Fifth Year = 7% x $1,966,194 = $137,634

Return on investment first year is 175%!

In Five Years, You Will Have Made $603,828
In Ten Years, You Will Have Made $1,450,728

Pull Out The Money
Do a cash-out-refi on your two best properties (borrow 90% of the equity).

Years One Property Two Properties

5th Year $45,000 - $55,000 $90,000 - $110,000
6th Year $45,000 - $55,000 $90,000 - $110,000
7th Year $45,000 - $55,000 $90,000 - $110,000
8th Year $45,000 - $55,000 $90,000 - $110,000
9th Year $45,000 - $55,000 $90,000 - $110,000
10th Year $45,000 - $55,000 $90,000 - $110,000

You now have a tax-free income for the rest of your life of $90,000 - $110,000 a year from your initial investment of $60,000 - $85,000.

Note: National appreciation average is 7%; at this rate properties will double every ten years.

New homes starting at $95,000
$4,750 Down payment @ 5% buys you a new house
Builder's will pay 2% of the non-recurring closing costs
Rental Ready Package ... All new homes include front and backyard landscaping, window coverings, refrigerator & stove and garage door opener
Strong appreciating markets where properties are projected to double in value in 5-10 years
Properties are located in great rental markets
Positive cash flow to breakeven properties
Property management will take care of your investment at a discounted rate
Invest out-of-state where the numbers make sense