Finding Opportunity in Comeback Markets

Job creation is up. Even better news … the jobs being created are blue-collar jobs, many in the reviving manufacturing industry.

This means more wages, more workers … and more folks who can pay rent.

In this episode of The Real Estate Guys™ show, we talk to an entrepreneur who has built a real estate business in an off-the-radar market.

The truth is, the hot markets you always hear about … San Francisco, New York, Los Angeles … don’t make sense for investors.

On the other hand, markets with not-so-great reputations might get you the best bang for your buck, depending on where they’re at in the market cycle.

Our conversation today delves into what makes a market make sense … and what it takes to make a profit in sensible markets.

Listen in … you’ll hear from:

  • Your reputable host, Robert Helms
  • His bad-reputation co-host, Russell Gray
  • Bryce Keesee, founder of Great Lakes Capital Solutions

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Riding the market waves

Let’s start with a quick real estate investing lesson.

Many people generalize the entire real estate investment category. They think real estate is overheated … so there’s no opportunity anywhere, for anyone.

That’s just plain wrong.

Real estate is NOT and asset class. It’s NOT a market. It’s an investment category with MANY different markets, each of which is in its own unique place in the market cycle.

But smart investors don’t look at averages. They take the time to do research, look for clues, kick the dirt, and meet people in individual markets.

When you’re looking for great markets, one excellent option is the comeback market.

Markets go through phases …

  1. Growth.
  2. Stabilization.
  3. Deterioration.
  4. Revitalization.

Catching a market as it hits step four is the key to riding an up-wave.

You don’t want to get in before things have started looking up … but you do want to get into markets that are turning upwards before the crowd.

Case study: Cleveland

Our guest Bryce Keesee got into real estate in southern Florida 15 years ago … but he has since switched to a market in the midst of MAJOR revitalization.

The market? His hometown … Cleveland, Ohio.

You might not initially think of Cleveland as a great investment market. That’s part of what makes it so great.

Bryce says the market offers many benefits … good price points for properties and rents, a steady flow of dependable tenants, stable worker incomes, and best of all … high cash flow.

Let’s get into what makes Cleveland so great.

First of all, a revitalized manufacturing industry only adds to the wide variety of blue-collar companies in the city.

Steel manufacturers join other major employers like Lincoln Electric, Progressive Insurance, several Amazon warehouses, and the renowned Cleveland Clinic, just to name a few.

This variety offers stability … and provides blue-collar jobs that keep rent prices steady.

These jobs are one reason Cleveland has a reputation for affordability.

Bryce is a fan of blue-collar workers because they tend to be long-term tenants. Many of these workers don’t plan to buy a home. Purchasing a property is “off the list” of goals for many people.

Dive into the details

We asked Bryce to give us the low-down on his typical rental property.

Bryce says properties are slightly different depending on location.

The east side of Cleveland has been abandoned for many years, although it’s starting to see growth now. So price points are a bit lower.

Bryce says single-family homes on the east side sell for $60-65,000. Monthly cashflow is $750 a month, on average … well above one percent.

The west side, on the other hand, has slightly higher price points and rents. Homes sell for 70-75,000, and rents are in the $900 range.

It takes 30-60 days from closing to repair and refurbish properties so they’re ready to rent.

The rehab process doesn’t follow a cookie-cutter template. Bryce and his partners have standardized the contractors and materials used, but each property gets an individual evaluation.

He wants well-functioning, desirable rentals that will save the company time and maintenance costs in the long-term.

That keeps tenants happy. Bryce also works to keep tenants happy by building relationships with tenants via his property management company.

“Our tenants love us,” Bryce says. A big reason is great communication from his property management team, with whom he has a 10-year relationship.

What about the general atmosphere of the Cleveland market? Ohio is extremely landlord-friendly, says Bryce. The law allows for a 3-day notice to vacate for non-paying tenants. The eviction process is only 10 days.

That doesn’t mean Bryce follows those timelines … he says his response is to establish a relationship with tenants and make sure the lines of communication are open. Yet another reason why property management is so important!

Investors interested in the Cleveland market should listen in to get access to a special report by Bryce that includes even more details!

Ohio Field Trip

Bryce really loves Ohio, and he thinks other investors will too.

Cleveland has great sports teams and the second-largest performing arts district outside of New York City.

But it’s also experiencing a revitalization that you can only really understand by kicking the dirt.

That’s why we recommend the Cleveland Field Trip.

You’ll get a chance to tour Cleveland with Bryce. But you’ll also learn about the investment model Bryce uses … an excellent education even if Cleveland isn’t right for you.

We live in an era of over-saturated markets. It’s hard to find markets that make sense. But some markets are just starting to get hot.

The very best way to get in on these markets is to learn from someone who has boots on the ground. Because remember, you’re not looking for a property, or even just a market … you’re looking for a TEAM.

And a field trip is the best way to meet the people … who know the market … and can help YOU build your own brilliant team.


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Creating Consistent Cashflow with Retail Real Estate

Most people in the real estate investing world tend to gravitate toward a specialty … a market about which they know ALL the ins and outs.

On our latest show, we’ll talk to someone who has made a particular market his bread and butter … the retail market.

Wait … isn’t retail dead? No!

In this episode we’ll talk with a 30-year veteran of the retail investment industry about WHY the retail market is still completely viable … and HOW you can get started in the wide world of retail.

In this episode of The Real Estate Guys™ show you’ll hear from:

  • Your seasoned host, Robert Helms
  • His senior co-host, Russell Gray
  • Retail investor and developer Michael Flight

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Why retail?

Michael Flight has been involved in shopping center development since 1986. His business, Concordia Realty has been adding value to shopping centers since 1990.

In his 30-year career, Michael has seen the retail industry change a lot. Change is one constant in the industry, he says.

Several decades ago, the Sears catalogue made a big splash and replaced the business of many local merchants. Today, Sears is going downhill quickly … due to the popularity of online shopping sites like Amazon.

But smart investors have found ways to make brick-and-mortar retail thrive.

Retail facilities have evolved from single-purpose buildings to multi-function facilities (think shopping malls with restaurants, entertainment, and a wide variety of stores).

Businesses like Amazon need space to store and fill orders … another place where real estate folks come in.

Michael calls his specialty “de-mall-ing” … that is, taking a struggling mall and changing out the tenants and revitalizing the complex for modern shoppers.

We’ll explore the nitty gritty of how to get into the retail market, but first, a few great reasons investors should consider retail as part of their investment strategy:

  • One of America’s favorite pastimes is shopping … in person. Although online shopping is increasing in popularity, it’s still only 10 percent of the retail market. And customers flock to big-box stores for necessities like clothes and shoes that are harder to buy online.
  • Investors don’t have to deal with two of the major problems of apartment investing … vacancy and turnover. Tenants typically sign long-term leases ranging from 5 to 40 years to very stable tenants. Michael says many tenants will be national brands who offer lots of equity and will advertise FOR you.
  • Low day-to-day involvement … tenants are responsible for their own maintenance and sometimes even build their own stores. With a triple-net lease, tenants are responsible for real estate taxes, insurance (both property and liability, plus the contents of their store), and maintenance, including common-area maintenance like plowing snow and maintaining lighting.

How does the retail market work?

What does it take to purchase a small shopping center? Michael says potential investors must answer a few questions first …

  • What’s the neighborhood like? Is the property located in a good location?
  • Is there an adequate local population to support retail stores?
  • Is there a good travel path? That is, is the center accessible to cars and located near homes and other businesses?

Once you’ve made sure those criteria are satisfied, you have to look at what kind of tenants are already there … and what kind of tenants you need.

Shopping centers should have an anchor tenant … a grocery store or drug store or other big brand that will draw customers to the shopping complex.

When you’re negotiating, anchor tenants often have a lot of power to negotiate terms. But if you have a really great location, that gives YOU more leverage.

And you have to make sure customers are going to come.

The threat from online retail is real, but that doesn’t mean brick-and-mortar retail stores are failing … it just means investors have to get creative.

That might mean integrating omni-channel options … warehouses that provide last-mile delivery and stores that offer online order pick-up, for example.

But the big question investors have to look at is how can we get more people here … and keep them here longer?

For example, don’t build a shopping center without integrating great places to eat and rest … you’ll get more customers who stick around, and a more successful investment.

Michael emphasizes that investors need to know about retail itself, from how retailers do business and which retailers sell what, to merchandising … putting the right tenants in the right spots.

That means making sure tenants are complimentary. Have a couple clothing stores? Make sure you look for a shoe store as well.

The fine details of retail investing

We asked Michael what he looks for when he is figuring out finances.

He said he wants the loan-to-square-foot amount to be $100 or less.

After that part is figured out, he does underwriting based on a 10-year lease.

Lenders range from big lenders to banks or private loans for turnaround situations.

“We really like to play in the 1 to 20 million dollar range,” says Michael. This puts him below big institutional facilities … but above the mom-and-pop shops.

How long does it usually take to rehab a distressed retail asset? Nothing ever goes as planned, Michael says, but three years is typical to execute a solid business plan.

Retail is a LOT different than single-family homes and apartment complexes, so we asked Michael to explain some of the big differences.

In retail, tenants typically get a retail improvement allowance.

Owners will offer a white box … drywall, drop ceilings, concrete floors, and bathrooms. They often offer an allowance to build out the store to the tenant’s specifications.

When tenants have very specific construction specifications, Michael says a good option is offering money or free rent so the tenant can deal with construction on their own.

Why should the investor pay for modifications to the retail space? It’s the standard … and investors want to draw in tenants that will stay for 5 or 10 years, or longer.

Remember, if you’re not ready yet to take on an entire shopping mall, working with a syndicator is always an excellent way to dip your toes into retail.

To dive into ALL the details, listen in for access to Michael’s special report on retail investing. He covers the HOW and WHY of retail real estate in depth.

Listen to experts!

You can’t fake 30 years of expertise.

Our mission is to find subject matter guides who know what they’re talking about and can educate our audience … YOU.

Michael Flight is a great example of someone who walks the talk. He is an expert in this area … and we hope your curiosity about the retail market has been piqued.

For more wisdom from experts, check out our Future of Money and Wealth video series … or meet some of the best minds in the investing world at our annual Summit at Sea™.


More From The Real Estate Guys™…

The Real Estate Guys™ radio show and podcast provides real estate investing news, education, training, and resources to help real estate investors succeed.


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Tariffs, Trade Wars, and Crash Talk with Jim Rogers and Peter Schiff

Freedom Fest is a crazy collection of different mindsets and ideas … and that’s why we make it a point to attend as often as we can.

In this episode of The Real Estate Guys™ show, we talk to two fellow Freedom Fest attendees about their thoughts on the economic and political realities of the world we live in.

These two guests have earned the right to have an opinion … and today, they’ll help us understand their thoughts on the bigger picture and how that picture affects YOUR investing business.

You’ll hear from:

  • Your thinking-ahead host, Robert Helms
  • His crashing co-host, Russell Gray
  • Legendary investor Jim Rogers
  • Finance pro Peter Schiff

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Why YOU need to understand the economy

Peter Schiff has taught us that economics and politics are intertwined. Policy effects the economy … and vice versa.

There’s a lot happening in the wider economic world that affects investors on Main Street. Realizing that has affected our decisions as The Guys … from the events we attend each year to the way we structure our annual Summit at Sea™.

Friends and mentors like today’s guests help us understand the economic systems at work in the U.S. and around the world … and how those systems affect what happens in the financial headlines.

Speaking of headlines, you won’t hear these gentlemen very often in mainstream financial media because they don’t fit the narrative the media wants to tell … which is that an upward trajectory can continue forever.

As we know, anything involving money follows a cycle of ups and downs … and we’re in the midst of the longest economic recovery EVER.

There’s no doubt that at some point, we WILL hit a downturn. But there is good news … those who prepare for impact can thrive, even during bad times.

Words of wisdom from Jim Rogers

Legendary investor Jim Rogers co-founded the Quantum Fund with George Soros.  

We were honored to talk to him about what it takes to be an investor in changing times.

“You have to be open to change,” says Jim. To anticipate future changes, you have to realize the world WILL change. And it takes work, he says.

So how can we prepare? “When everyone’s exuberant, you should be worried,” Jim notes. “That means they’re not thinking.”

(Hint, hint: consider the current market.)

Jim has written several books. His most recent is called A Gift to My Children.

Although Jim didn’t originally want kids, he found out he was wrong once he had his own children. These days, he is always thinking of what he wants to teach his kids.

That’s what the book is about … the lessons he has learned in investing and in life, for his kids … and yours.

We also asked Jim for his thoughts on cryptocurrencies. He said, “Blockchain is going to change everything we know.”

That means a lot of people being put out of business … but it will also CREATE a lot of new businesses. So don’t worry.

We can translate that same idea to the broader economic world. You’ve got to go through a downturn to get to an upturn.

Jim reminded us that the Chinese word for crisis, weiji, means both danger and opportunity.

Speaking of China … that’s where Jim lives. He decided to move to the other side of the world to make sure his children grew up speaking Mandarin … they’re now fluent.

“China’s going to become the next great country,” he says.

Peter Schiff offers a voice of reason

We also enjoyed chatting with financial guru Peter Schiff. He has attended every Freedom Fest except one … and that was because his child was due.

Before the ’08 financial crash, Peter was a voice of reason. He maintained that the economy wasn’t great … everyone just thought it was.

The booming economy pre-crash was based on a bubble of appreciation, consumption, and inflated prices. People were deceived because it seemed like good news was around every corner … so they weren’t prepared for the bubble to pop.

As opposed to the bubble in ’08, our current bubble hasn’t provided boosts to the large majority of people, says Peter. We’ve just barely reached pre-recession levels.

So, why do these economic bubbles happen? It’s a result of what Peter calls “stag-flation” … stagnation PLUS inflation.

Subscribers to Keynesian economics believe unemployment causes inflation, so the idea that employment AND inflation could rise at the same time seemed impossible.

But inflation is caused by an expanding money supply, not expanding prices.

And the thing that keeps prices in check is the supply of products. Having a lot of stuff bolsters a strong economy and keeps a lid on pricing.

Scarcity is what leads to high prices.

Inflation in the 1960s happened because of policies from earlier decades, says Peter … high spending, high levels of borrowing, and the government’s decision to go off the gold standard.

According to Peter, today’s monetary policy is MUCH WORSE than anything that happened in the 60s and 70s.

And our economy is less secure … so we can’t just raise interest rates when things get bad.

Everybody is exposed, says Peter … because everyone has more debt and interest rate risk than ever before.

The Fed doesn’t want to think massive inflation is possible. “But it’s the problem you don’t see coming that gets you,” Peter notes.

The next crisis “will be bigger and will be worse.”

Peter talks tariffs and trade wars

People are excited about tariffs on China … but they shouldn’t be, according to Peter. “We derive the most short-term benefit from trade,” he says. “We have the most to lose.”

The problem is not the federal deficit … it’s the economy. When deficits pile up, we destroy our wealth, and right now we have HUGE trade deficits because of our fiscal policy.

We also have tax and regulatory codes that make American businesses less competitive.

But trade deficits offer us two BIG benefits.

First, we are getting a ton of REAL products … and it costs us nothing, because we can produce or borrow those dollars out of thin air.

Second, when the Chinese recycle those dollars, they buy U.S. treasury bonds.

So trade deficits mean prices are lower and interest rates are lower.

If Trump is successful on tariffs, Americans will have higher prices, higher interest rates … and a lower standard of living.

Tariffs “will make us the losers in the short term,” says Peter. They’ll also exacerbate any recession that happens.

We talked with Peter about one more thing … why investors should consider gold and international assets.

When we spoke, gold and silver prices were down. “That’s the flip side of optimism,” Peter says. “Optimism is not buying gold, because people usually buy gold when they’re worried, and people aren’t worried right now.”

“When no one is worried is when YOU should be worried,” Peter says.

Gold is more valuable now than it was in 2011, says Peter … but it’s also cheaper.

He told us there’s tremendous potential in gold mining stocks, as well as international assets.

Investors should look for where money will go when it flees the U.S. … and try to invest there before the economy crashes and there’s a stampede.

Remember, you can make 10 times the amount you invest … but you can never lose 10 times the amount. You can only lose what you put in.

For more from Peter, check out the Peter Schiff Podcast.

Get educated

Peter and Jim have a different way of looking at the world … and that’s a good thing.

If you’re learning some of their concepts for the first time, we wouldn’t be surprised if you’re a bit lost. That’s okay.

We encourage you to keep seeking out knowledge and multiple perspectives … so you can make informed decisions and be prepared for the future.

One great resource to consider is our Future of Money and Wealth video series.

We realized our conference speakers had a WEALTH of information to offer … so we decided to share it with YOU. This video series is great for beginners and long-time investors alike.

Remember … you can’t take effective action without education!


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Robert Kiyosaki on the Financial System, Fake Teachers and Real Assets

This summer, we spent time at events like Freedom Fest and the Red Pill Expo … where we bumped into some of our mentors and friends … folks like Peter Schiff and Robert Kiyosaki.

It’s not by accident we keep running into the same people. These folks all have the same desire … to read between the lines and find the TRUTH about what’s really happening in the world. And they don’t jump to conclusions.

Robert Kiyosaki has helped us see both sides of the story for decades. This time around we chat with him about his views on the financial system, fake teachers, and the importance of real assets.

In this episode of The Real Estate Guys™ show you’ll hear from:

  • Your very real host, Robert Helms
  • His faking-it co-host, Russell Gray
  • Best-selling financial author Robert Kiyosaki

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Get a REAL education

We spoke with Robert Kiyosaki at Freedom Fest. “I come to learn,” he says.

Freedom Fest and similar events … like the New Orleans Investment Conference are like a mental gym. “They challenge the way I think,” says Robert.

That’s one reason educational events are so important (like our Future of Money and Wealth webinar series, which features talks by Robert and many more financial gurus).

REAL education is more than just listening to the salespeople. It’s getting outside your cocoon and seeking out new information.

Invest in your PASSION

One idea Robert thinks is really essential in the investing business is to invest in what you love and enjoy. “I do think real estate is the best,” says Robert … that’s why it has been his bread and butter for years.

But maybe avocadoes are your passion … in that case, perhaps you should consider investing in an avocado farm.

You should always do your due diligence and work with a good financial planner … but investing in your PASSION will always be more successful than investing in something you’re “meh” about.

REAL assets, REAL money, and REAL teachers

“We don’t have a prayer as long as we’re working for money,” says Robert. He believes investors should steer away from money … in favor of REAL assets.

Investors should also surround themselves with REAL professionals … those who’ve done their research and know what they’re talking about.

A lot of people are in trouble because they’re learning from FAKE teachers, says Robert … people who don’t have a real conception of cash flow.

Two other things investors should be aware of … FAKE money and FAKE assets.

Be wary of a monetary system that isn’t backed up (by gold, for example), and don’t rely on traditional assets, Robert advises.

If you’re doing everything “right” … working a 9-to-5 job, putting money in your 401k, investing in stocks … you’re being screwed by the system, says Robert.

SMART investors have to learn to work WITH the system.

For more on FAKE versus REAL, check out Robert’s upcoming book FAKE, which will be released as an entirely digital series.

REAL talk about our financial system

Central banks control paper money … and that’s dangerous, says Robert. He cites people like Jim Rogers, who believes we’re headed for the worst crash yet because we have an abundance of printed money and debt.

“Tragedy follows printing money,” says Robert.

But it doesn’t matter how bad the system is … what matters is the actions YOU take. We like to say BE the Fed … don’t BEAT the Fed.

That means figuring out how to make the most of our financial system … knowing the tax laws and figuring out how to make them work for you.

“The next collapse will look like something we’ve never seen before,” says Robert.

But investors don’t have to be scared … if they prepare for the inevitable BEFORE it happens.

We talked with Robert about digital currencies, like Bitcoin. “Gold and silver were here before us and will be here forever,” says Robert.

But investors need to look at real assets (like property and gold), cybercurrency, AND paper money when they’re investing … because they’re the three big components of our current monetary system.

Smart investors work to figure out what is real and lasting.

For more from Robert Kiyosaki, read the classic book Rich Dad Poor Dad … if you haven’t already. And check out the Rich Dad Radio Show.

A REAL financial expert

Robert has been studying the financial system forever. He remembers the history of money and has watched the financial system change.

As we often say, “Those who fail to remember history are doomed to repeat it.”

You HAVE to understand financial fundamentals and the structure of our financial system before you can read the news and really SEE between the lines.

Like Robert says, a crash is highly likely … we can’t predict WHEN it will happen, but we CAN hedge against the eventuality of it.

Get educated … so you can stay on top of the wave when the tsunami comes.


More From The Real Estate Guys™…

The Real Estate Guys™ radio show and podcast provides real estate investing news, education, training, and resources to help real estate investors succeed.


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Growing Profits Naturally with Farmland Investing

A diverse portfolio offers you a cushion … if one investment suffers, you won’t feel the impact across your entire portfolio. One method for portfolio diversification is to step outside home or apartment investing … and into farmland investing.

Investing in a commodity like produce or cattle allows you to lose your focus on an individual market and start focusing on the GLOBAL market for your product.

Like any real estate investment, there is a learning curve to figuring out agriculture … especially when you’re growing and exporting produce outside your home country.

But agricultural investments are worth the effort … they offer the best of all worlds, combining agricultural income with land banking and offshore strategy.

In this episode, global investor Carsten Pfau discusses his journey into the world of agricultural investing … and offers ideas on how YOU can get started as a passive investor in this low-risk option.

In this episode of The Real Estate Guys™ show you’ll hear from:

  • Your orange-loving host, Robert Helms
  • His like-a-lemon co-host, Russell Gray
  • Carsten Pfau, manager of a thriving international real estate business

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How Carsten Pfau got planted in Paraguay

Trees don’t understand what’s happening at the Fed. They just grow. And the fruit, vegetables, and nuts they produce fulfill a fundamental, permanent human need for food.

Bread-and-butter commodities like agriculture will be valuable forever … that’s one reason we were so excited to chat with agricultural investor Carsten Pfau.

Carsten’s family is established as real estate developers and investors in his native Germany and in South America.

He decided to shift from traditional real estate to agricultural investing for one big reason … “You can sell agricultural products word wide.”

That’s one reason agriculture is so great. It’s less about getting the MARKET right, and more about getting the PRODUCT TYPE right.

For Carsten, the primary product is oranges. He also grows vegetables and grazes cattle.

When he stepped into the Paraguayan market with his brother Michael Pfau, Carsten quickly realized oranges were a great choice. Eighty-five percent of the oranges sold in Paraguay are imported, so there’s a huge market for locally grown produce … and potential for favorable margins.

Why Paraguay? One reason is its competitive cost structure. Because it is a developing country, costs are low, but there’s tremendous opportunity to innovate and bring in new technology … resulting in excellent profits.

Paraguay is great, but in order to do business there, Carsten says he had to learn the language … and the mentality. Every nation has different cultural mores, and identifying and learning them is essential to business success.

Growing from the ground up

Carsten says growing his business was an “amazing process.” When he opened up his orange plantation to investors, he expected 10-15 people to join in.

Instead, he ended up with 500 investors.

Agriculture requires a scale approach … the larger you are, the more efficient you can be, and the higher your profits. That’s why Carsten started syndicating.

He also says demand for oranges is growing so quickly that the biggest challenge is growing more. It’s the opposite of traditional real estate … instead of recruiting buyers and renters, he can sit back and CHOOSE from all the buyers who are coming to HIM.

We asked Carsten how he figured out the science of agriculture.

Carsten told us every plant he buys for his home dies … so his oranges aren’t thriving because of his green thumb!

They are thriving because he has compiled a team of the best experts in the business. His advice for investors is to “never think you know it all.” Instead, admit your strengths and weaknesses and join forces with talented people.

Plant your feet in a plot of your own

Agriculture can be daunting because it requires a lot of specific knowledge. One option for investors who want to get involved but don’t have the time or interest to get their hands dirty is passive investing.

“People are interested in two things,” says Carsten, “owning land and getting a cut of the action.”

Carsten combined these two things in his own business by offering investors the opportunity to buy the rights to their own parcel of land … and then sign a farming agreement with his management company, which plants, cares for, and harvests the trees.

This type of investment offers the best of two worlds … a land investment that appreciates over a long period of time, PLUS regular income from the produce.

Investors do have to wait about four years after their initial investment to start seeing proceeds. That’s how long it takes orange trees to mature and start bearing fruit.

Parcels start at 1.2 acres. For an initial $35,000 investment, clients get payroll for the Pfau’s workers, pest control, watering, and the trees themselves … and they never have to pay anything again.

Profits range from $5,000 to $12,000 per plot per year … and continue for 25 years, the span of the trees’ life. That’s a pretty good ROI!

Why agriculture?

“I like traditional real estate and still do it,” says Carsten. But the approach is very different. Marketing, financing, and selling are all different challenges.

The upside? “Here we can sell nation- and world-wide.”

“I like that I can lean back and choose when to stop,” says Carsten.

And he’s confident in the longevity of demand for his product. The middle class across the world is growing … and they’re hungry for high-quality food and water.

Whether you’re in Latin America or on the other side of the world, food is a fundamental human need. Succeeding in the food production business lies in getting the right scale.

The right way to do it is to find a pipeline of deal flow that will allow you to leverage your due diligence into MORE deals.

In many international markets, new technology and techniques allow forward-thinking investors to create massive economies of scale … allowing both syndicators and investors to get decent returns.


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Cover Your Assets Part 2 – International Structures for Extreme Protection

We live in a big world … one that offers benefits to those willing to step outside of their comfort zones.

In Part 1 of Cover Your Assets, we discussed domestic structures that can isolate and protect your assets in the case of legal trouble.

In Part 2, we’ll look at the bigger picture of asset protection.

We’ll discuss international asset protection structures and long-term wealth protection strategies … and we’ll also talk about what investors can do to protect their privacy and take advantage of tax laws.

It might sound complicated … but luckily, our guest Kevin Day is an expert in offshore asset protection and came on the show to simplify the topic for us.

In this episode of The Real Estate Guys™ show you’ll hear from:

  • Your world-traveling host, Robert Helms
  • His channel-surfing co-host, Russell Gray
  • Best-selling author and lawyer Kevin Day

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Trusts 101

Kevin sat down to chat with us in breezy Belize.

He points out that U.S.-based investors have to be on their A game … because in this country of extreme litigation, “A lawsuit is equivalent to a lottery ticket” … for the person suing YOU.

One way to protect your wealth from lawsuits? Trusts.

Kevin took us through a brief history of trusts in the U.S.

Trusts were formerly designed solely to transfer wealth from one person to another. Revocable trusts were invented in the 1930s to allow people to set up a way to transfer their estates … and make tweaks to the structure along the way.

It wasn’t until the 1980s that the U.S. allowed people to name themselves as the beneficiary of a trust for the first time.

These trusts allow you to segregate your assets … so you still have a decent lifestyle and you can reduce your liability.

“It’s a way to firewall the various parts of your life,” says Kevin.

Trusts are unique because they don’t have an owner … they exist independently from you. That’s why their lawsuit proof, says Kevin.

If you set up legal structures, including trusts, while the seas are calm, you’ll be able to handle the lightning when it comes.

And once you go through the process, you can pay more attention to MAKING money than PROTECTING your money.

Getting started

Although setting up trusts can seem tricky, it isn’t that overwhelming if you take it step by step. Investors should get started early.

Most lawyers don’t teach clients about inter-entity planning … but when Kevin gets new clients, he takes them through a step-by-step process to help them protect their assets.

Kevin starts by completing a liability assessment to see how much liability the investor holds.

He looks at what protections that investor already has in place. This includes projecting the investor’s future plans to develop a streamlined structure. Assets are divided into three categories:

  1. Zero-liability assets, like your cash portfolio.
  2. High-liability assets; for example, a company that has employees or uses third-party providers
  3. Assets that are in between, like real estate … high-value, high-liability assets are included here.

He uses these three categories to see how exposed clients are. He then checks to see whether investors are holding the proper insurance … usually a moderate amount.

After that, he works with the client to set up the appropriate structures that will provide the most protection in the simplest way.

Are you an investor wanting to get started with a trust? Kevin suggests building up to an offshore trust by setting up a domestic trust with decanting provisions that will allow it to move offshore gracefully.

The WHEN and WHY of international trusts

We asked Kevin when it was appropriate for investors to consider offshore trust options.

He told us that investors with a net estate of over more than 4 million … and that includes their home, business, and rentals … should absolutely set up offshore options.

That’s the point where all your creature comforts are taken care of and any extra money you’re taking in goes toward growing your real estate business.

Under 2 million, an offshore trust is not appropriate, simply because of the cost-to-benefit ratio.

Between that 2 and 4 million mark is where there’s some leeway. If you have a high-liability business, you probably shouldn’t go international. But if you’ve just hit a home run and you’re growing exponentially, then you should consider an offshore account.

Offshore options allow investors to lower their profile in case of a lawsuit, says Kevin. Lawsuits feel like blackmail … and what you look like from a public view will change the lawyer’s perspective.

Trusts can help you manage privacy concerns about how much of your wealth shows up on the public record.

Why is this so important? If you’re sued, there’s a discovery period where the other attorney can look at your assets.

Eighty percent of the time, says Kevin, those attorneys don’t look into how your assets are structured … and the other 20 percent of the time, they see international structures and think getting that money is more trouble than it’s worth.

Worry less with offshore trusts

Kevin says investors have three things to worry about:

  1. Taxation
  2. Privacy
  3. Asset protection

According to him, the great thing is that trusts help in all three areas.

Lawsuit protection trusts are tax neutral … and don’t rely on keeping secrets from the IRS. They also offer complete bars to anyone who wants access to your money.

What if you own property offshore? Americans who own foreign companies don’t have to pay tax until their income is repatriated. Setting up your income to be non-subpart F can be very easy, says Kevin … with the right professional help.

There’s no point in building up your assets without also protecting them so you don’t lose everything when disaster strikes.

Exploring your opportunities for asset protection means looking at offshore options.

So much real estate education is fun and aspirational. Asset protection is a down-and-dirty topic … but it’s SO important.

Being a real estate investor means dealing with real threats and the possibility of bad deals and mistakes. It’s essential to discuss what could go wrong … while everything is still going right.

That’s why we’re so glad to have an expert in offshore protection in our fold! We want YOU to know your options for asset protection so that if the lightning hits, you can have one piece of your business fail without everything else falling apart.


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Cover Your Assets Part 1 – Protecting Your Wealth Today and Tomorrow

An essential element of real estate investing is protecting the assets you’ve worked so hard to acquire.

When you’re just starting out, your investment business is pretty low liability. But as you acquire properties, the liabilities build up … and a legal problem with one property could cascade and affect your other assets if you don’t have the proper protections in place.

In this show, we’ll talk with a Rich Dad advisor on how to sort your assets into buckets so you NEVER lose everything at once.

Part one of this two-part series is for beginners and experienced investors alike. As John F. Kennedy said, “The time to repair a roof is when the sun is shining.” NOW is the time to put in place protections to keep you safe if troubles arise.

In this episode of The Real Estate Guys™ show you’ll hear from:

  • Your host, asset Robert Helms
  • His liability of a co-host, Russell Gray
  • Garrett Sutton, best-selling author and legal advisor to Robert Kiyosaki

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Firewall your assets

The society we live in is very litigious … and that’s not going to change any time soon. So what can investors do?

We talked to Garrett Sutton about precautions YOU can take to protect your assets as they grow.

Your best option, Garrett says, is probably an LLC, simply because they provide the best asset protection. An LLC allows you to firewall your assets so one lawsuit doesn’t set off a chain reaction that leaves you asset-less.

Why is an LLC better than a corporation? Besides better asset protection, LLCs offer more tax flexibility and charging order protection.

Charging orders are legal judgments that allow creditors to access the money you make through your business. But some states offer charging order protection to LLCs.

And, Garrett says, most lawyers prefer to go through insurance so they can collect right away. So ideally investors have two firewall protections … an LLC or corporation AND insurance to back them up.

Some states, like Utah, California, and New York, don’t provide great asset protection for LLCs. Creditors can blow through the LLC and force the sale of assets … not ideal.

What can you do if you live in a state that doesn’t have the best rules for entities? Garrett reminds us you DON’T have to form an entity in the same state as your property or your residence.

How to set up your own LLC

While setting up an LLC may sound onerous and difficult, Garret says it’s really not that hard. There are two main steps:

  1. Set up an LLC in the state you want.
    1. Pick a name and make sure the name is available
    2. File your articles of organization, operating agreement, and certificates.
  2. Transfer the title of your property into the name of your LLC. This is NOT a sale … simply a transfer.

While there are plenty of websites advertising do-it-yourself LLC help, it’s much better to talk to an attorney, says Garrett.

A certified legal professional can walk you through all the steps and help you understand which business decisions are right for you.

And, an attorney will help you stay aware of formalities … the easy-to-follow rules that will keep your LLC safe from legal troubles.

Fine-tune your asset protection strategy

Garrett is a best-selling author. His books on starting your own corporation or LLC cover the strategies and techniques YOU can use to increase wealth and reduce risk.

A technique SOME people use is changing their LLC from partnership taxation to C or S corporation taxation.

That’s fine, says Garrett … as long as you don’t forget to amend your operating agreement.

Business decisions as simple as tax changes have many permutations we don’t even think about … another reason an asset protection attorney is essential.

Other investors are looking into offshore asset protection trusts. Something some investors don’t realize is that more than 10 states have created onshore trusts. But while these trusts make your money bulletproof, recent cases have demonstrated that it’s only bulletproof in the state where you’ve set up the trust.

Although there are many tricks for upping your protection level … and your wealth … investors don’t need 17 layers of LLCs.

They also don’t need to spend a ridiculous amount of money to form an LLC. For example, a Wyoming LLC provides great protection levels, for only $50 a year (plus any legal fees).

And LLCs don’t mean you’re locked into operating decisions. You have the latitude to make changes. LLCs are flexible!

Interested in delving deeper into the legal realm of asset protection? Delve into what Garrett has to offer on his website.

And while Garrett provides affordable asset protection and legal services, that doesn’t mean you shouldn’t seek out your own legal help … just make sure the people you work with are serious about helping small investors stay on top of corporate formalities.

In part two of our asset protection series, we’ll delve deeper into the legal world with a discussion of offshore asset protection strategies. Listen in for info on taking your profits outside of the States!


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Home-building bust … good, bad, or ugly?

One reason we write is because very little mainstream financial commentary addresses the unique needs of real estate investors.

Most financial pundits think of real estate merely in terms of home prices, home builder stocks, and maybe real estate investment trusts (REITs).

Their preferred investment strategy is buy-low-sell-high … usually based on divining things wholly outside an investor’s control.

It’s more like gambling than investing.  They even call their positions “bets”.

Of course, the buy-low-sell-high trading mentality encourages the churning of holdings … which generates commissions and short-term capital gain taxes.

That’s nice for Wall Street firms and the government which protects them, but not so much for Main Street investors trying to build reliable retirement income.

And if you watch the financial news, you’ll notice any discussion of yields and earning is generally in the context of their impact on share prices.  So back again to the buy-low-sell-high mentality.

But long-term income-property real estate investors look at the world VERY differently than the players and pundits of Wall Street.

For real estate investors, it’s all about acquiring streams of cash flow …

… collecting contracts (leases) with people and businesses who work every day and send us a piece of their production.  It’s a beautiful thing.

And even though we LOVE equity … we know REAL equity growth is driven by cash flow.  More cash flow equals more equity.

Of course, the purpose of equity is to acquire more cash flow.  Managed properly, they feed each other.  It’s a virtuous cycle of compounding wealth.

Best of all, with real estate, many of the factors affecting cash flow are very much within the control of the investor.

With that said, we still watch mainstream financial news for clues about what’s happening with the financial system, geo-politics, and macro-economics …

… and we carefully consider how those higher-level factors can directly impact Main Street investors.

So when the June new housing stats came out, here are some of the headlines that popped up in our news feed …

Weak Housing Starts Hurt Homebuilder Stocks
– Barron’s, 7/18/18

Housing Permits Soften, Starts Plummet
– Mortgage News Daily, 7/18/18

Slump in London House-Building Weighs on UK Housing Starts – U.S. News & World Report, 7/25/18

There are lots more, but you get the idea.  Pretty gloomy.

But these stories are just clues in the news.  We still need to figure out why it’s happening, what it means, and how it affects Main Street real estate investors.

Big picture, there are those who think housing is a leading indicator of a healthy economy.  So when housing is doing well, it drives economic growth.

We’re not so sure.  It seems to us housing is a trailing indicator … a reflection of economic growth.

After all, who buys a house so they can get a job?  Buying a home is sign of economic success, not a creator of it … at least not for consumers.

So we think a weak housing market is a reflection of a weak home-buyer.

This begs the question … WHY is the home-buyer weak?

We tossed in the UK article to highlight this weak housing-start situation may not be reflective of issues at merely the local or even national level.

So even though real estate is LOCAL … certain factors affecting it are MACRO … perhaps even geo-political or systemic.

But because we’re news hawks at every level … local, macro, geo-political, and systemic … we’re aware of some of those potentially contributory factors.

But let’s start with the basic economic principle of supply and demand. 

And remember … we always break out “capacity to pay” from “demand” because it makes us focus on factors of affordability.

Think about it …

“Demand”  alone for housing is fairly universal.  Nearly everyone wants a home … a bigger home, a better home … so demand in terms of desirability is almost a given.

But just because someone WANTS a home doesn’t mean they can AFFORD one.  So much of housing demand pivots off of demand’s “capacity-to-pay”.

And then there’s inventory … of both houses (supply side) and people (demand side).

Generally speaking, the world is increasing in population, though not always in any given geographic area.  So it’s certainly possible for an area to lose population, and demand for housing along with it.  Think the fall of Detroit.

But because the slowdown in home-building appears to be occurring in diverse locations, we’ll toss out the notion it’s driven by a slump in the supply of people and a shrinking demand for homes.

We’ll assume there’s plenty of people who want housing.

Now on the housing supply side, we find another clue here …

U.S. home sales sag as prices race to record high
– Reuters, 7/23/18

“ … a persistent shortage of properties on the market drove house prices to a record high.”

Hmmmm … that’s weird.

Low inventory explains slow sales and higher prices.   But wouldn’t both of those things entice home-builders to build MORE … not less?

After all, if buyers are bidding prices UP, the opportunity to earn profits should entice builders to increase production to cash in.

Yet there’s a reportedly low supply of houses, and apparently strong demand reflected by rising prices … and for some reason home-builders are slowing down.

Again, the market’s natural reaction SHOULD be to increase supply … which then drives down prices … and makes housing more affordable to more people.

But that’s not happening.

We think it’s because it can’t.  After all, a home-builder can only drop prices so far before it’s no longer economical to build.

As we’ve discussed previously, one of the first casualties of tariffs was lumber costs.  Steel is another.  And of course, there’s the labor shortage driving up costs in residential construction.

To top it all off, there’s the well-publicized increases in interest and energy expenses … which add costs to almost everything.

So with nearly every component of cost on the rise, builders can only drop prices so far … then they either can’t build, or they need to charge more.

But charging more means buyers must be able to pay more …

Maybe when builders are looking at their market studies, they’re not seeing an increase in buyer’s capacity to pay.

When mortgage rates are going up faster than paychecks … and inflation, gas prices and tariffs squeeze consumers … it drags DOWN their capacity to pay more for housing.

So after digging deeper, it seems there’s some understandable logic to the slowdown in housing permits … in spite of low inventory and rising prices.

Is that bad?  It depends.

Remember .. when people can’t afford to buy, they need to rent … from YOU.

When housing crashed in 2008, it was a huge BOON to investors in affordable housing.  The demand for rentals went UP.  Many real estate investors made fortunes.

So the lesson remains … the flip-side of problems are opportunities when you’re aware and prepared.

Right now, in spite of reports of a booming economy and high consumer confidence, it may not translate quickly into a boom in home-buying or home-building.

That might make Wall Street worry, but for Main Street real estate investors focusing on affordable markets and product types …

… or specialized niches like residential-assisted living or resort property which cater to affluent people …

… there’s still a lot of opportunity to build reliable long term wealth through real estate. 

Until next time … good investing!


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The Real Estate Guys™ radio show and podcast provides real estate investing news, education, training, and resources to help real estate investors succeed.

Lessons from Facebook’s face-plant …

No doubt you’ve heard Facebook’s stock face-planted recently. But just in case, here’s the whole gory story in just three headlines over five days …

Facebook stock hits record high ahead of earnings – MarketWatch 7/25/18

Investors … continue to shrug off … gaffes … with privacy and security … Chief Executive Mark Zuckerberg … said … the company has not seen an impact on the company’s top line.”

Facebook’s stock market decline is the largest one-day drop in US history

– The Verge 7/26/18

“Facebook’s market capitalization lost $120 billion in 24 hours.

Facebook’s stock set to enter bear-market territory after third straight decline – MarketWatch 7/30/18

“The stock has now fallen 22% from its record close … on July 25.”

Of course, if you’re a real estate investor this may seem like only a moderately interesting side story buried in all the news flying across your screen.

And maybe that’s all it is.

Then again, maybe there are some things to be gleaned from this epic implosion … even for real estate investors.

Lesson 1: Just because everyone else is … doesn’t mean YOU should

Your mom probably taught you that. But it’s good investing advice too. It’s never smart to be late to an equity party … or late leaving.

The so-called FAANG stocks (Facebook, Apple, Amazon, Netflix and Google) are the “must have” stocks for … just about EVERYONE.

The problem is popular assets often get bid up well past their fundamental value … as speculators jump in hoping to ride the upward trend for awhile …

… and hoping to be fast enough to get out before the trend turns.

Of course, hope isn’t a very good investing strategy.

Lesson 2: Don’t ignore problems just to keep hope alive

Notice the quote about investors continuing to shrug off bad news … ignoring the obviously developing problems at Facebook.

So when Zuckerberg comes out right before the bad news … even as Facebook’s stock was heading to a record HIGH … and says the problems aren’t affecting the top line …

… investors apparently chose to believe him, … and not heed the clues in the news that clearly showed Facebook was headed for stormy seas.

Now, investors are suing Facebook and Zuckerberg for misleading them.

But investors should also look at the big picture, and consider the motives of these who claim as is well.

Remember this classic assurance from the world’s foremost banker?

“Importantly, we see no serious broader spillover to banks or thrift institutions from the problems in the subprime market.”

– Federal Reserve Chairman Ben Bernanke on May 17, 2007

Just a year later the financial system all but imploded.  But the danger signs were there …

Peter Schiff and Robert Kiyosaki were warning people. Most didn’t listen.

We didn’t. But you can be SURE we listen today.

Lesson 3: Momentum is a condiment … not a meal

With real estate, sustainable profit is all about the income.

Sure, it’s great when things get hot and people want to pay MORE for the SAME income.  But at some point, the numbers don’t make sense.

You can bad fundamentals and invest primarily because “it’s going up.” But when momentum fades, prices snap back to fundamentals.

If you’re on the wrong end of it, it’s painful.

Of course, if you see it coming, you can cash out via refinance or sale, and store up some dry powder for the soon-to-be-coming sale.

Lesson 4: Trends and indexes are interesting, but the deal’s what’s real

We have a big, diverse audience … so we talk about big picture stuff. It’s important to see the big picture.

After all, every asset you own is floating in a big sloshing economic sea.

If you’re not aware of weather patterns and watching the horizon, you might not see storm clouds and rough waters forming.

But investors make money in EVERY kind of economic environment, so it’s not the conditions which dictate YOUR success or failure.

It’s your attention to being sure each individual deal YOU do makes sense.

That means the right market, product type, neighborhood, financing structure, and management team.

Keep the deal real … and have plans for what you’d do in a variety of economic situations …

… so when conditions change you’re not caught unaware and unprepared.

“The time to repair the roof is when the sun is shining.”

– John F. Kennedy

Lesson 5: Train wrecks in stocks can be tee-up for real estate

This is our favorite.

It’s not that we take joy when the stock market reveals its true character … but we know it’s a wake-up-and-smell-the-coffee moment for many Main Street investors.

As our friends Chris Martenson and Adam Taggart recently pointed out

… if you take the FAANG stocks out of the stock indexes, the highly-touted stock index returns would have been NEGATIVE.

It’s hard to diversify when you you’re exposed to the hot stocks everyone’s piled into … directly or indirectly.

So as Main Street investors come to suspect the disproportionate influence just a few arguably overbought stocks have on their TOTAL net worth and retirement dreams …

… history says people’s hearts turn home to an investment type they instinctively understand and trust. Real estate.

So for those raising money from private investors to go do more and bigger real estate deals, a stock market scare can make it easier for your prospects to appreciate what you’re offering them.

Lesson 6: Do the math and the math will tell you what to do

Very few paper asset investors we’ve ever met actually do the math.

They either buy index funds based on trends and history, and don’t realize most are exposed to the same small group of hot stock everyone owns …

… or they buy stocks based on a hot tip, a gut feeling, or a recommendation from someone they think is smarter than they are.

But real estate math is SO simple to understand and explain.

And when you can quickly show a Main Street paper investor how a 15-20% annualized long-term return on investment real estate is quite realistic … with very moderate risk …

… real estate is the CLEAR winner.

Even a modest 3% per year price appreciation on 20% down payment (5:1 leverage) is 15% average annual growth rate.

Add to that another 2% or so a year in amortization … paying down the loan using the rental income … you’re up to about 17% annualized equity growth.

Toss in another modest 3-5% cash-on-cash and some tax benefits and you’re pushing 20% annualized total return pretty fast.

And that’s just bread-and-butter buy-and-hold rental property.

There are all kinds of specialty niches and value-add plays which allow active investors to goose returns …

… or for a syndicator to put a lot of meat on the bone for their passive investors … and still take a piece for doing the work.

Lesson 7: Monitor your portfolio for weak links and over-exposure

Lots of paper investors who didn’t even know they were exposed to Facebook are finding out the hard way …

… just like when we didn’t realize our whole investing and business model depended on healthy credit markets.

So be aware …

When you’re overly exposed to a critical factor like interest rates, credit markets, a tax law, a specific industry or employer, or even a currency or financial system

… you run the risk that a single unexpected event can take a BIG bite out of your assets.

And while you might not be able to fix everything right away, the sooner you’re aware of the risks, the sooner you can start preparing to mitigate them.

Until next time … good investing!


More From The Real Estate Guys™…

The Real Estate Guys™ radio show and podcast provides real estate investing news, education, training, and resources to help real estate investors succeed.

The Market Detective – Uncovering Clues for Finding Great Markets

Across the country, real estate markets are hot … and getting hotter. That means compressed cap rates … which in turn mean a lower rate of return for investors.

So how can investors find a market that will offer great returns in good times and bad? In today’s show, we’ll discuss the market fundamentals that can make or break your next real estate investment deal.

Luckily, markets leave clues. If you’re an excellent market detective, you’ll be able to spot subtle indicators that will help you make an educated guess about the market’s future.

For this episode of The Real Estate Guys™ show, we recruited the best private eye we know to guide us through his analytical approach to investigating and choosing new investment markets.

You’ll hear from:

  • Your sleuthing host, Robert Helms
  • His clueless co-host, Russell Gray
  • Real estate developer and author Victor Menasce

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Stepping into new markets with Victor Menasce

Victor Menasce is the author of Magnetic Capital and a successful U.S.-based real estate developer. He’s a strong believer in the principle that the best markets aren’t necessarily the ones you live in … or near.

Instead of automatically going for nearby markets, Victor undergoes a thorough evaluation process for potential markets, whether they’re near or far.

One of the things we look for when we’re analyzing a new market is net in-migration … essentially, we want to know whether there are more people entering the market than exiting.

Metrics like these can help you predict whether a market will serve your investment goals.

For Victor, market evaluation begins with the most basic metric of all … supply and demand. That means choosing a market where demand outpaces supply.

He says investors should focus on three things when entering a new investment deal, in the order listed:

  1. The market.
  2. The team who has boots on the ground in that market.
  3. The specific investment opportunity.

If you perform due diligence on the market and the team and something doesn’t line up, then you need to step back and reassess … before you even look at specific investment opportunities.

Philadelphia market analysis

To model his process for market choice, Victor guided us through an analysis of one of his current investment markets … Philadelphia.

“You have to look on the macro level,” Victor says.

Like many large American cities, Philadelphia has a large low-income population. This is a benefit, says Victor, because it creates areas where high-priced real estate and low-priced real estate brush up against each other.

The key is to find the arbitrary line between high and low properties … and then move that line by creating value.

Another reason Philadelphia is so successful is because of its proximity to an overpriced, overcrowded market … New York City. Victor says he sees a lot of renters moving from the New York market to Philadelphia because of its relative affordability and proximity to the Big Apple.

Two other big factors Victor looks at are population influx and job creation and availability.

He also evaluates cap-rate compression. That’s how he discovered that he can build new for 25 to 30 percent less than he can buy used. “That’s a competitive advantage,” Victor points out. “We’re creating opportunity out of thin air.”

Another point of consideration is rental rate per square foot. In Philadelphia, Victor can charge between $1.50 and $1.75 per square foot … $1,200 to $1,400 per month for an 800-square foot B-class apartment.

Victor compares that to Raleigh, North Carolina, where the average rents average $1.15 per square foot, even for class A properties. That’s about $920 for the same 800-square-foot apartment, for context.

Although rents differ, the cost of building in Raleigh and Philadelphia is comparable. That’s why Philadelphia makes far more financial sense for Victor.

Victor also walked us through the process of finding a team in the Philadelphia market. “I only go to Philadelphia one to two times a year,” he says. He started by making friends with an active group of investors already in Philadelphia who had good connections to local contractors and businesses.

Then, he amassed property by buying land and derelict structures for “pennies on the dollar.”  

Lake Charles, Louisiana market analysis

Although big markets like Philadelphia generally make more sense for real estate investors and developers than smaller markets with fewer resources and infrastructure, Victor is currently investing in properties in a small town in Louisiana.

Why? The town, Lake Charles, has several compelling factors that make it a great place for long-term investing.

He walked us through his process of discovery and analysis.

Through personal relationships with people in the Louisiana real estate market, Victor came across Lake Charles, a town on the I-10 corridor.

The town is poised to produce 118 BILLION dollars of natural gas over the next decade … now that’s a staggering number.

Because of its increasingly important status as an exporter of natural gas, jobs and ancillary services are expected to increase over the next decade … and with that, the population is expected to keep rising.

With 48-50 billion dollars of construction in the works or anticipated, the population growth isn’t solely temporary workers, but also new permanent residents.

This is a town where skilled labor prevails, so the average household income is north of 90k a year … not the typical tenant profile. That means rents in Lake Charles average around $1.50 per square feet, even though it’s not a major city.

Because Lake Charles is growing so rapidly, it needs construction of all kinds. So Victor has dipped his feet into several markets, including workforce, family, and senior housing as well as medical offices.

It’s a lesson to investors … start with the market, then discover the needs and assemble a team to address those needs. Investors who go into markets operating only in a small niche may miss the best opportunities.

Why is Victor so confident in Lake Charles? “This is a town that has embraced heavy industry,” he says. He expects few obstacles to pop up as the town continues to grow. And he’s confident in his assessment because he has relied on folks who have their boots on the ground.

Treat real estate investing like a business

Victor has a pragmatic approach to market analysis. He’s logical and thorough and treats every investment decision like it’s a business decision.

We like to say that most people know a little about a lot, but Victor knows a lot about a lot. But he also knows his limits.

It’s really hard to be involved in more than a handful of markets at once … careful investors can’t do the kind of analysis Victor has done for Lake Charles for 30 markets simultaneously.

And Victor has spent the time to cultivate relationships with his teams in Lake Charles and Philadelphia. That’s important too.

We think Victor is a great resource for investors looking to take a careful approach to market choice and more. Looking for more real estate wisdom? Listen in to his Real Estate Espresso podcast, a 5-minute, interview-style briefing he puts out 7 days a week.


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The Real Estate Guys™ radio show and podcast provides real estate investing news, education, training and resources to help real estate investors succeed.

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