Profitable Niches – Investing Internationally

Is investing offshore right for you?

International investing can be both exciting and daunting. In our fourth installment of the Profitable Niches series, we hope to demystify the process for investors looking to cross some borders.

Every investment has a risk … you just have to learn how to evaluate the risk and the reward so you can choose wisely.

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

  • Your world-traveling host, Robert Helms
  • His petrified-of-planes co-host, Russell Gray
  • CEO of Mahogany Bay Village and international investor, Beth Clifford

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Expand your horizons with international investing

Our guest has made a name for herself in international investing.

The CEO of Mahogany Bay Village and a pro at international resort investing, Beth Clifford started expanding her own real estate business by moving into different states.

It wasn’t long before she got an itch to start looking outside the United States.

She’s a great example of someone who’s become a success by opening up her geographic horizons.

“It’s always convenient to live and invest in the same place, but real estate is about location,” Beth says. Investors have to look beyond what is outside their bedroom windows.

International investment also provides an opportunity to diversify and put your assets into different baskets.

Whether you’re an investor looking to expand beyond your state of residency or your country, Beth says the methodology is the same.

To invest smartly, you have to understand the market, laws, and culture of the place you’d like to invest in.

And just because there might be a learning curve doesn’t mean you should shy away from good opportunities.

Take what you’ve learned and expand it into another arena, whether that’s a new asset class in the same location or the same asset class in a new location.

Either way, you expand your world—and get the chance to become an expert all over again.

When you’ve learned one new market, it’s easier to get to know a second one, Beth notes.

And … “It’s all about teams,” she says. As someone who owns, invests, and develops in multiple countries, Beth has learned the value of a talented team.

Let’s talk about taxes

As soon as you cross a country border, you have to understand an entirely new tax system. That’s why Beth has separate development companies for properties inside and outside the U.S. … and why she enlists professional help when it comes to accounting.

Although taxes can be tricky, owning property and businesses outside of the United States can reap great tax benefits.

Despite that, some tax professionals still make a habit of creating fear, uncertainty, and doubt for investors who would like to make some money across country lines.

Beth recommends shopping around for an informed professional … because although the attorneys make it seem hard, there are really only three documents you need to complete each year.

She recommends professional assistance for at least your first two years, until you have a solid understanding of the basics.

One thing to be aware of? Currency arbitrage and exchange. If you’re unaware of currency issues, they could bite you. Make sure you understand whether you can easily exchange currency and whether the jurisdiction you’re investing in is neutral.

A relationship business

Real estate is a relationship business. And especially when investing beyond your familiar boundaries, building local relationships is key.

We asked Beth how to she expands her network across borders.

“I ask for help when I go into a market,” she says. Investors should have “an attitude of humility, not hubris.”

The first thing Beth does is look for the Class A players in a given market. Who are the top three law firms, employers, development companies?

Beth seeks out the movers and shakers … then picks their brains for advice.

“A players fly with A players,” she says. “It’s the rule.”

Networking doesn’t cost you money … and it gets you into the contact database of the best and brightest.

Once you’ve sought out the best, go in with the intention to learn. Ask these bright business people how they’ve obtained their success and where they see YOU going wrong or right.

The goal is to find team members who provide value to you … and are excited to do so.

And one business relationship can net literally millions of potential customers.

It’s all about leveraging yourself.

Is making connections any different in a foreign country? “People are the same everywhere,” says Beth.

Basic human connection is the key, no matter where you go. People want the same things … so connect on a common level.

Thinking about making the leap?

Wondering whether you’re cut out to be an international investor?

Beth recommends starting by test driving the market. Do a due diligence tour outside of the U.S. … like one of our discovery trips.

It’s a great way to get to know the area in which you might be investing, educate yourself on the culture and special considerations, get to know local movers and shakers … and have some fun.

Seeing how others put together international investments can be eye-opening, says Beth. Discovery trip attendees get a year of education … in four days.

So get there … and see what awaits you beyond the horizon.


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.

Profitable Niches – Residential Assisted Living Homes

The Silver Tsunami is coming. That’s right. It’s no secret Baby Boomers are retiring and entering a new phase of life, and looking for an alternative to traditional assisted living facilities.  

In the third episode in our Profitable Niches series, we explore the world of residential assisted living homes.

We chat with leading national expert and President of Residential Assisted Living (RAL) Academy, Gene Guarino, about this compelling investment opportunity, and four of his students who are successfully investing in this space.    

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

  • Your happy-to-assist host, Robert Helms
  • His in-need-of-assistance co-host, Russell Gray
  • RAL Academy President Gene Guarino
  • A few of Gene’s star students, Sherry Ellingson and Rocky McKay, Loe Hornbuckle, and CJ Matthews

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An explosive demographic with specific needs

So much of real estate is about understanding specific demographics and their needs. All around the world, and especially in the United States, there is a massive population that has created business opportunities through every season of their lives … baby boomers.

Baby boomers are retiring in droves, and they aren’t too far away from not being able to live independently anymore. Unlike generations before them, boomers (in general) are adamant about not living in an institution or hospital. They want to live in a home and have a social life.

That’s what makes residential assisted living homes such a fascinating investment niche. This specific demographic and a unique financial model means more CASH FLOW than a typical single-family home investment.

Gene Guarino is the leading expert in this investment niche. As president of the Residential Assisted Living (RAL) Academy, he teaches investors everything they need to know to get started.

“It all starts with education. Get educated first. If you don’t, you’ll most likely go out, make mistakes, and bang your head against the wall,” Gene says.

We’re all about education for effective action. So, we sat down with a few of Gene’s star students to learn about their experiences and what advice they have for other investors.

Building your brand from the ground up

Sherry Ellingson and Rocky McKay are business partners who attended Gene’s class several years ago.

“We kept hearing about senior living,” Sherry says. “We both have parents who are going to be entering into this category before long, and after taking a look at some of the current options in our area we thought, ‘You know, we could do this a little bit better.’”

Rocky and Sherry first acquired an existing assisted living facility that needed some updating. The property is 10 beds with jack-and-jill baths and lots of places for residents to be able to visit with friends and family. The goal is to have residents feel at home and have a happy, safe place to make their own.

How do they attract tenants? Case workers from hospitals and rehab centers refer potential residents and their families to placement agents who find out what they are looking for in an assisted living facility.

Then, the agents take them on tours and show refer them to various home options. That’s why a good reputation is so important.

“The reputation of a home is attached to the owner, so your focus should really be on creating your own reputation and brand from the ground up,” Sherry says.

“The demand for a good home is extremely high, and as we provide such an essential service for our residents, it feels like we are doing the right thing,” Rocky adds.

For investors just starting in the niche, Sherry and Rocky recommend looking for an existing home and remodeling it into a residential assisted living home. They also suggest having a fixed rent rate with everything included so families can set their budget and not worry about hidden fees.

And don’t forget that there is benefit in adding more properties. More residents means the ability to buy supplies in bulk and save even more money on operation costs. Sherry and Rocky hope to have a couple hundred operating homes in the next several years.

Raising capital and expanding your network

After going through the RAL Academy course, Loe Hornbuckle found his passion. Since then, he has opened 40 beds in residential assisted living homes and is in the process of developing an 80-bed facility made up of five homes on six acres as a planned community.

“I look at residential assisted living as a tool to keep people out of nursing homes or institutional environments that may not be right for them,” Loe says. “There are a lot of people who are placed inappropriately in those settings.”

Even though he was passionate about the type of investment he was making, Loe says he still had a lot to learn when it came to raising capital.

“The first time I raised capital, I put out my business plan, and at the end of the first day my wife found me in the fetal position on the floor. It was harder than I thought it would be,” Loe says.

Proper education changed this for Loe. He learned you have to build a network to effectively raise capital. He suggests that RAL investors attend events and conferences so they can meet the many people out there who are willing to help them along the way.

“Your network is everything. When you build your network, you have the power to step into good business like residential assisted living,” Loe says.

Syndication and working smarter

As a self-proclaimed real estate addict, CJ Matthews was looking for an investment with good cash flow and without a huge amount of ongoing work. After hearing Gene speak on RAL homes, she knew she had found the perfect niche.

“With residential assisted living, you do the work to set everything up, and then you become the business owner. At that point, someone else can actually run the day-to-day business for you,” CJ says.

The biggest advice CJ offers to potential RAL investors is to learn about and apply effective syndication.

“Before learning to syndicate, going out and asking for money felt risky or scary to me, but after I attended the Secrets of Syndication seminar, I knew what I needed to do,” CJ says.

When it comes to working with partners, CJ recommends choosing people who have skill sets you don’t. That way you can work synergistically and accelerate your success. And don’t forget this particular investment niche requires a special touch.

“This space isn’t for everyone. You need to love real estate, love making money, love putting in work on the front end, and most importantly have a heart. If you aren’t willing to care about these people and making the last years of their lives happy, then this may not be the investment for you,” CJ says.

Interested in learning more about investing in residential assisted living? Listen in to the show to hear more from Gene and his students. You can also email us at ALF@realestateguysradio.com, and don’t forget that Gene will be cruising with us on our Investor Summit at Sea. We’d love to see you there!

Listen to other episodes in our Profitable Niches series (like Stacking up Profits with Self Storage or Making Money with Mobile Homes) to step off the beaten path and learn more about other lucrative, but as-yet unexploited asset classes.


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.

Expecting the Unexpected – Investing in Uncertain Times

Real estate investing is full of ups … and downs. If you haven’t experienced the downsides, we guarantee you will eventually.

As a real estate investor, you have to be on top of your game. You didn’t get into this business to pull the sheets over your eyes … you’re here to build wealth, and that requires planning and preparation.

You can’t bet on disasters NOT happening … they most likely will. Careless investing is a sure recipe for a crash. Careful investing, on the other hand, will help you survive crashes without losing the wealth you’ve accumulated.

In this episode of The Real Estate Guys™ show, we discuss how YOU can prepare for storms that come out of nowhere. You’ll hear from:

  • Your careful host, Robert Helms
  • His criminally cautious co-host, Russell Gray

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The nature of real estate

The real estate market is naturally volatile. Economies change, local markets evolve, natural disasters arise … sometimes overnight.

The downsides are ALWAYS looming.

But real estate investors are always looking for the upsides … sometimes so intently that they forget to look at the downsides too.

We caution you to do your due diligence AND have a back-up plan.

Some excellent words of wisdom are to always have a little cash on hand. The downsides are rarely in your control … but you can control your ability to react when they arise.

Four ways to be prepared for a downturn

As real estate investors, we weigh risk and reward every time we look at a deal. But some risks aren’t so obvious.

Being a successful investor means playing defense and offense at the same time.

While you can’t predict the future, you can take practical steps to make sure you’re ready to fend off threats and take advantage of smart deals.

Step No. 1: Get in touch with a demographic that can weather a storm.

Tapping into the right demographic is the key to recession-resistant investing.

It’s a smart idea to look at markets where someone who is a bit under the median income can afford to live.

In tough times, people who are well-off can downgrade to your market. And in good times, people on the lower end of the income scale can move up.

Either way, your area will be in demand.

Many factors can cause a downturn … rising interest rates, slow wage growth, tax increases, or geographic factors to name a few.

Downturns aren’t solely due to nation-wide economic slowdowns. Make sure you pick a demographic that can resist small ebbs and flows in your market.

Step No. 2: Invest in towns that have multiple “stories.”

Every town has something it’s known for.

Even better is a town that’s known for many things … the stories that draw people and growth.

A big industry would be one story. Two big industries? Even better. A major sports team might be another story.

Don’t bet on a single story. Make sure the jobs in your market are tied to multiple industries … that way, when one industry fails unexpectedly, you won’t see a mass exodus or decline.

And be sure an area is appealing for more than one reason.

Step No. 3: Monitor your inputs.

Look at what inputs make the numbers on your financial statement move. These are the inputs to keep track of.

Compile data, set up alerts, and don’t be remiss about digging deeper when an alarm goes off in your head.

All the information you need can be found in one way or another. The internet is a treasure trove of data. Your local Chamber of Commerce is another resource for keeping track of essential information.

Don’t be casual … especially if you’re an experienced investor. Treat every deal like it’s your first.

Monitoring your inputs can help you stay ahead of the curve and react to changes before others even know there’s a threat.

Can you see the advantage?

Step No. 4: Key into experts.

We live in the information age … it’s almost ridiculous how much information is available.

But some of the best information comes from people who have been in your situation and figured out solutions.

Listen to and read information from multiple sources … even if you disagree.

Learn what other people are saying BEFORE you interject your own opinion.

You can’t expect the unexpected if you only listen to people who share your point of view.

Navigating the three rings of risk

We’ve learned a lot over the years.

One piece of advice we think highly of is to always own a property or two with no loan. The return won’t be as high … but you can sleep at night.

In investing, it all comes down to the rings of risk.

Every investor should have three rings of risk in their portfolio.

The center ring is your livelihood. It should be isolated from all the other risks you’re taking.

The second ring is those bread-and-butter properties that bring cash flow and provide long-term equity growth from modest appreciation.

The third ring is where your risky investments happen. You should only expand into this area after you’ve established the first two rings of your investment portfolio.

In the outer ring, you can be more speculative. You may lose quite a bit in this ring … you’re taking on way more risk. But you could also win big.

Another thing to keep in mind is your Plan B.

In any short-term play, make sure you have a Plan B and even a Plan C to take you through the long term.

Sometimes the market changes in the middle of your play. In that scenario, financing structures and a property’s ability to cash flow can be really important.

If you are house rich and cash poor, it may be time to sit down with a financial advisor and considering refinancing so you can leverage the equity you have in your properties.

You may also want to consider selling and buying new properties so you can get some cash on your balance sheet.

When the market turns, you want to be in a position to snatch up a bunch of cheap real estate … and you won’t be able to do so unless you have cash on hand.

Another consideration to take is whether to diversify your liquidity. If the dollar falls, precious metals will retain their value … and the more wealth you have, the more important it is to put your equity in a stable medium.

Your best strategy is a strong network

Knowing how to sell is the essential survival skill in a tough market.

We’re hosting our yearly How to Win Funds and Influence People event this year … a workshop that teaches participants negotiation strategies that result in win-win deals.

We host events like these because networking is SO important. The best way to prepare for the unexpected is to get around smart people and take note of their strategies.

Getting around people who’ve been in your shoes is essential … and most successful real estate investors are more than happy to share what they’ve learned.

We don’t only host events for investors like you … we also attend them! We’ll be at the upcoming New Orleans Investment Conference learning about all things investing with some of our most knowledgeable investor friends.

Join us!

Your net worth is defined by your network. Make those crucial connections, and you have the key to staying strong through ups AND downs.


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.