EP112: Buying Rentals in a Down Economy

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This episode of Investing in Real Estate is brought to you by Thumbtack. Visit thumbtack.com to find help in your area with more than 1,100 different services.

Due to the cyclical nature of the economy and the current volatility of the political system, many investors are concerned about the future of the market. Many investors worry about their diversification, and how the future of market will affect their investments.

On this episode of Investing in Real Estate, Natali and I are discussing a principle you can use to adjust your wealth building strategy. We’ll talk about how to take advantage of the market with different strategies, regardless of market conditions. If you want to prepare for market changes in 2017, this episode is for you!

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There is a real estate mantra that says, “when the going gets tough, the tough go shopping.” But what exactly does does this mean? Seasoned and successful investors don’t rely on market conditions in order to be profitable.

In fact, they prepare for all types of market conditions, and change their strategy accordingly. This is a deliberate choice to be an active participant in your wealth building strategy. As we discussed with Harry Dent, an economic downturn can be an incredible opportunity to purchase rental properties at a discounted price.

In order to take advantage of this opportunity in the market, there are a few things you must have in place. First of all, cash is king! It’s also imperative to have a goals sheet, and work toward those goals intentionally.

On today’s show, we’ll elaborate deeply on how to be prepared for market corrections as real estate investors. We’ll also talk about traditional loans during an economic recession, and hassles that may arise with titles. Don’t miss episode 112 of Investing in Real Estate!

If you’re ready to begin building a passive income through rental real estate, book a FREE call with our team today. We’re ready to talk about your goals and want to help you learn more about earning legacy wealth for you and your family.

How to take advantage of the real estate market with different strategies, regardless of market conditions. If you want to prepare for market changes, this episode is for you!

On this episode you'll learn:

  • How can you position your real estate business for a market downturn?
  • What happens with a property when the borrower defaults on their loan?
  • How can you save cash for rental properties?
  • Can you secure bank products in a recession?
  • And much more! 

Episode Resources
Thumbtack
EP040: How to Implement Profit First for Real Estate Investing
EP064: The Big Crash of 2017 is Coming: Here’s How to Protect Yourself – Interview with Harry Dent
Rich Dad Poor Dad by Robert T. Kiyosaki
Find Your Financial Freedom Number
Subscribe to the Morris Invest YouTube channel

Like Morris Invest on Facebook

EP111: Understanding Real Estate Jargon 101 Part Two

Book a call with our team: https://goo.gl/dezwHT

This episode of Investing in Real Estate is sponsored by Audible. Visit audible.com/IIRE for a free audiobook with your 30-day trial.

On one of our most popular episodes, I explained common real estate terms that confuse and overwhelm new investors. I get a lot of questions about real estate terminology. I often feel like real estate jargon can be confusing and too inclusive.

Today on Investing in Real Estate, I’m discussing more real estate lingo! I’ll explain more common real estate terms and phrases mean. If you’ve ever felt overwhelmed by real estate terms, this episode is for you!

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If you missed episode 33, you might want to go back and listen, as it is part one to this episode. There you can find definitions and examples of real estate terms such as ROI, cash-on-cash return, CAPEX, rent-roll, and tenant turnover. On this episode, I want to get even more specific.

You might hear commercial real estate investors use the term “pro forma.” This is not used exclusively in real estate; it’s a business term. Pro forma is a projected figure of financial results. In real estate, pro forma is applied to the projected income of a property. For example, how much rent the property will bring in, and what the expenses will be.

Another term you might hear often in the real estate world is operating expenses. In real estate, operating expenses are costs like property insurance, property taxes, and utilities. An operating expense is any cost that deducts from overall cash flow on a property.

On today’s show, I’ll go more in depth into these terms, and how they apply to real estate. I’ll also discuss NOI, and lease up fees. If you’re a new real estate investor, stick around for episode 111 of Investing in Real Estate.

If you’re ready to begin building a passive income through rental real estate, book a FREE call with my team today. We’re ready to talk about your goals and want to help you learn more about earning legacy wealth for you and your family.

Discussing more real estate lingo! Explains what common real estate terms and phrases mean. If you’ve ever felt overwhelmed by real estate terms, this is for you!

On this episode you'll learn: 

  • What types of expenditures are not included in NOI?
  • Where does the term pro forma come from?
  • How much should you expect to pay for a lease up fee?
  • What expenses does a lease up fee cover?
  • And much more!

Episode Resources
Audible
EP033: Understanding Real Estate Jargon 101
Find Your Financial Freedom Number
Subscribe to the Morris Invest YouTube channel
Like Morris Invest on Facebook

EP110: Laid Off From His Job and Now Financially Free [Case Study]

What would you do if you were to suddenly lose your job? Would you panic, or could you cover your cost of living? Many investors have their expenses covered because of real estate.  Today’s guest turned lemons into lemonade and started earning a passive income when he lost his job!

On this episode, I’m interviewing new investor, David Amonick. David is here to share his journey into becoming a real estate investor, how he is creating financial freedom, and what it’s like to invest in turnkey properties. Don’t miss episode 110 of Investing in Real Estate!

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It wasn’t long ago that David Amonick had what many people would describe as a secure career in an IT department at an insurance company. However, he dreaded waking up every morning and going into work. He always had the idea of real estate in the back of his mind, but didn’t know where to begin.

Early in 2016, he began researching real estate investing. He read books like Rich Dad Poor Dad, and started to learn more about building a passive income. Soon after, he was laid off from what he thought was his safe and secure job.

Days after being let go, he heard an ad on the radio for a free real estate seminar. Since he had no time commitments, he decided to see what it was all about. He learned about many different types of real estate: flipping, rehabbing, and turnkey investing.

When he heard about the advantages of turnkey investing, David knew it was what he wanted to do. He loved the idea of getting started quickly without having to reinvent the wheel. His attention was sparked further when he realized he could purchase homes around $50,000 outside of his home state of New York.

He interviewed several different turnkey providers, and found our team. He was pleased with the answers he was provided with, but most importantly he was impressed with the potential ROI he could earn. It didn’t take long for David to realize that turnkey investing was his niche. He quickly acquired five properties, and is on his way to achieving financial freedom.

On today’s show, David is sharing his entire experience, including his hesitations, strategies, and advice. We’ll discuss his favorite real estate resources, and how to get started as a beginner. David’s willingness to take action is inspiring; you won’t want to miss his story on today’s episode of Investing in Real Estate!

If want to build a passive income through rental real estate like David, book a FREE call with my team today. We’re ready to talk about your goals and want to help you learn more about earning legacy wealth for you and your family.

This guy turned lemons into lemonade and started earning a passive income when he lost his job!

On this episode you’ll learn:

  • What are the benefits of turnkey real estate investing?
  • How can you determine how many rental properties will help you reach your goals?
  • Are properties in the Midwest safe?
  • What methods and strategies has David used to purchase his properties?
  • And much more about turnkey real estate!

Episode Resources
Rich Dad’s Guide to Investing by Robert T. Kiyosaki
Rich Dad Poor Dad by Robert T. Kiyosaki
Real Estate Investing for Dummies by Eric Tyson and Robert S. Griswold
Tax-Free Wealth by Tom Wheelwright
Clayton on the BiggerPockets Podcast
Find Your Financial Freedom Number
Subscribe to the Morris Invest YouTube channel
Like Morris Invest on Facebook

EP109: How to Write Off Date Nights on Your Taxes

Can date night serve as a legitimate business expense? In our experience: yes, but only under very specific protocol. If you want to write off a date night on your taxes, you must be organized and able to prove how a date night benefited your business. 

On today’s show, Natali and I are sitting down to discuss how to write off your date nights on your taxes. We’ll explain how to determine if an expense is legitimate, as well as how to prove it to the IRS. We’ll also share specific tools and tips you can use to document your expenses. Don’t miss this episode of Investing in Real Estate!

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To be crystal clear, this strategy is not about pulling one over on the IRS. We do not use our business income for personal expenses. However, we do benefit from the ownership of our business by funneling legitimate and appropriate expenses through the business.

When you and your spouse are partners in an incorporated business, certain expenses are to be expected. And the IRS allows you to subtract your business expenses from your business income in order to be taxed on fewer dollars.

So it makes sense for a business to have as many expenses as possible, in order to lower overall taxation. Certain expenses are needed to run a business. Think internet connection, cell phones, insurance, gas on a business trip. Business meetings can also be necessary to the health of the business.

And that’s how we occasionally qualify our date nights as business expenses. These meetings do serve a purpose, and you have to be able to prove it, should the IRS ask at tax time. It’s imperative that you keep your receipts from these meetings, a copy of an agenda to prove what business topics were discussed.

On today’s show, we’ll discuss in depth how to qualify an expense as a business purchase. We’ll also share what kinds of expenses are absolutely not legitimate business expenses. Please join us for episode 109 of Investing in Real Estate!

If you’re ready to begin building a passive income through rental real estate, book a FREE call with my team today. We’re ready to talk about your goals and want to help you learn more about earning legacy wealth for you and your family.

Discusses how to write off your date nights on your taxes. How to determine if an expense is legitimate, as well as how to prove it to the IRS.


On this episode you’ll learn:

  • What types of purchases can and cannot qualify as a business expense?
  • Can you take cash out of an ATM for a business purpose?
  • How can you differentiate business mileage from personal mileage?
  • How do you avoid comingling?
  • And much more!

Episode Resources
EP019: How to Pay Less in Taxes – Interview with Tom Wheelwright
EP010: How to Set up Profit First for Real Estate Investing – Interview with Mike Michalowicz
NeatReceipts
Automatic
Find Your Financial Freedom Number
Subscribe to the Morris Invest YouTube channel
Like Morris Invest on Facebook

EP108: The Five Most Landlord Friendly States

This episode is brought to you by Audible. Visit audible.com/iire for a free audiobook as part of your free 30-day trial!

As a real estate investor, it’s imperative that you are informed about what your rights are in the states where you own properties. Before purchasing a rental property, you should research the laws on lease agreements, security deposits, and evictions.

On this episode of Investing in Real Estate, I’m sharing the five most landlord friendly states. I’ll discuss each state in detail, including what traits make them favorable for real estate investors. The implications of these laws can be significant; don’t miss this episode of Investing in Real Estate!

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5) When it comes to renting, Florida has lax legislation. In fact, there is no law requiring you to have a written lease agreement! In the Sunshine State, you can quickly evict a tenant, and there are very few laws that dictate what you can and cannot do as a landlord.

4) Arizona has laws that are favorable for landlords. For instance, if a tenant lies on their lease, they can immediately be removed from the property. Eviction happens very quickly in the state.

3) Although Colorado can be an expensive state to invest in, their laws favor landlords. If your tenant isn’t paying rent, the state of Colorado is quick to kick them to the curb!

2) If you’re familiar with our podcast, you’ll know that Indiana is one of my favorite states to invest in! Evictions happen very quickly, and the judges have zero tolerance for renters who don’t pay.

1) Don’t mess with Texas! In the Lonestar State, the eviction process is efficient. Landlords are also protected if a tenant decides to sue.

On today’s show, I’ll speak in depth about each of these states, and the criteria for a landlord friendly state. I’ll also share other metrics you should consider before purchasing a rental property in any state. Join me for episode 108 of Investing in Real Estate!

If you’re ready to begin building a passive income through rental real estate, book a FREE call with my team today. We’re ready to talk about your goals and want to help you learn more about earning legacy wealth for you and your family.

On this episode you’ll learn:
How long should you expect an eviction to take?
Which states are unfavorable for landlords?
What are non-compliance laws for tenants?
And much more!

As a real estate investor, it’s imperative that you are informed about what your rights are in the states where you own properties. Before purchasing a rental property, you should research the laws on lease agreements, security deposits, and evictions.

EP107: The Intelligent REIT Investor - Interview with Brad Thomas

A real estate investment trust, commonly refereed to as a REIT is a type of investment that allows individuals to purchase a stake in large-scale assets. Many REITs invest in office buildings, shopping malls, and other pieces of large, commercial real estate.  

On this episode of Investing in Real Estate, I’m sitting down with Brad Thomas to discuss the world of real estate investment trusts. Brad is the editor of the Forbes Real Estate Investor newsletter, and the co-author of the Intelligent REIT Investor. Brad is an expert on the intricacies of REITs, and on today’s show, he’s sharing his knowledge!

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Brad Thomas recalls as a child, he loved to play Monopoly. He learned early in life that acquiring real estate can be a wealth engine. Immediately after attaining his degree, Brad immersed himself into the world of real estate. He initially worked as a leasing agent, and later transitioned to development.

After the recession, Brad questioned his place in the real estate industry. He possessed a wealth of information, but in the crash he lost a large chunk of equity in his properties. He knew he wanted to pivot, and decided to use his knowledge to help other investors avoid common mistakes.

He became a writer, and entered the REIT industry, which he describes as his calling in life. Brad explains that the average investor lacks liquidity, diversification, and transparency within their portfolio. Investing in a REIT can help an investor avoid all three of those pitfalls.

Brad explains that an REIT has the benefit of liquid security, at any time; an investor can access their funds with the click of a button. REITs also have diversification, as they can provide variety both geographically as well as within a rental base. In terms of transparency, REITs are governed under the SCC and have the benefit of professional, experienced, management teams.

On today’s show, Brad is sharing more insight into the mechanics of REITs. We’ll discuss his favorite sectors within the REIT space, as well as the intentional purpose of REITs. You'll hear all of this, and more on episode 107 of Investing in Real Estate!

If you’re ready to begin building a passive income through rental real estate, book a FREE call with my team today. We’re ready to talk about your goals and want to help you learn more about earning legacy wealth for you and your family.

A real estate investment trust, commonly refereed to as a REIT is a type of investment that allows individuals to purchase a stake in large-scale assets. Many REITs invest in office buildings, shopping malls, and other pieces of large, commercial real estate.  On this episode of Investing in Real Estate, I’m sitting down with Brad Thomas to discuss the world of real estate investment trusts. 

On this episode you’ll learn:

  • What qualifies as “real estate” in a REIT?
  • What are the four different “food groups” in REITs?
  • What is the fundamental law of REITS?
  • How do dividends work in a REIT?
  • And much more about real estate investing!  

Episode Resources
Forbes Real Estate Investor Newsletter
The Intelligent REIT Investor by Brad Thomas and Stephanie Krewson-Kelly
The Trump Factor by Brad Thomas
The Ground Up Radio Show
Find Your Financial Freedom Number
Subscribe to the Morris Invest YouTube channel
Like Morris Invest on Facebook

Contact Brad Thomas
Website
Facebook
Twitter
LinkedIn

EP106: How to Balance Assets vs. Liabilities

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Last week we discussed briefly what it means to evaluate what you own vs. what you owe. A listener wrote us about the idea of leveraging, and how it works. Leveraging is a useful strategy when practiced appropriately, so we decided to discuss it here on the show.

On this episode, Natali and I are discussing how to assess your assets and liabilities, and how to be leveraged appropriately. We’ll elaborate on the importance of calculating your net worth, and how to structure your assets vs. liabilities. Join us for episode 106 of Investing in Real Estate!

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Leverage means taking what you own, and using it as collateral to make further purchases. In real estate, leveraging is how successful investors are able to quickly and effectively grow massive portfolios.

In order to leverage well, it’s imperative that you know where you stand. The first thing you should do is assess all of your liabilities. This includes all of your debts. Include the remaining balance on your mortgage and car loans, any credit card debt, a HELOC, etc.

Then determine what your assets are, and how much they are worth. Include your real estate investments, cash accounts, stocks, and 401k. Other assets could be college savings accounts, vehicles you own, and art. Include anything that is cash, or could be sold for cash.

How to balance assets vs. liabilities - using leverage for real estate investing.

The next step is to subtract your total assets from your total liabilities to calculate your total net worth. We follow the advice of Natali’s dad, who recommends that you should own up to 30% of your portfolio, and be no more leveraged than 60-70%.

On this episode, we’ll elaborate further on this formula, and how you can apply it to your scenario. We’ll talk extensively on the importance of leveraging, and how to use your assets to your advantage. It’s all here on Investing in Real Estate!  

Are you ready to create passive income through rental real estate? Book a FREE call with our team today. We’re ready to talk about your goals and want to help you learn more about earning legacy wealth for you and your family.

On this episode you’ll learn:

  • How do you calculate your debt to equity ratio?
  • What lessons can we learn about leveraging from the 2008 housing crisis?
  • What intangibles can serve as leverage?
  • How does this concept differ from the Dave Ramsey approach?
  • And much more!

 Episode Resources
EP102: Creating Streams of Cash
EP103: Behind the Scenes of Our Next Real Estate Purchase
The Instant Millionaire by Mark Fisher
Missed Fortune 101 by Douglas Andrew
How to Calculate Your Net Worth by Natali Morris
Clayton Morris on Goodreads
Natali Morris on Goodreads
Find Your Financial Freedom Number
Subscribe to the Morris Invest YouTube channel
Like Morris Invest on Facebook