Podcast Summary
The Importance of Rewarding Yourself in Real Estate Investing: Celebrate milestones and accomplishments, make plans and commit to them, and reward yourself for achieving success in real estate investing.
Learning from this episode of the Bigger Pockets podcast is the importance of rewarding yourself for achieving success in real estate investing. The guest, Tim Shiner, shared his experiences and insights on this topic, emphasizing that it's essential to celebrate milestones and accomplishments along the way. Brandon and Mindy also discussed their personal experiences and shared a quick tip about making plans and committing to them to make desired goals a reality. Overall, the episode was filled with valuable insights and inspiration for investors at all stages of their journey. Additionally, Brandon shared a quick tip about making plans and committing to them to achieve desired goals. He shared his experience of booking an Airbnb stay in Hawaii for a month to learn how to surf and emphasized the importance of taking action and following through on plans. The episode also featured a promotion for DealMachine, a tool that provides unlimited access to phone numbers and contact information for real estate leads.
Starting in Real Estate with Little Capital: Strategies and Inspiration: Aspiring investors can start with no money down through Rent to Retirement or 1031 exchanges, while focusing on quality properties in desirable areas can maximize returns.
There are various strategies to get started in real estate investing with little to no upfront capital. Rent to Retirement offers the opportunity to buy new construction rental properties with no money down, while 1031 exchanges can help investors defer capital gains taxes when selling and buying new investment properties. Tim Shiner, a successful real estate investor, shares his story of starting young in real estate after buying his first house at 19, despite facing challenges like being robbed twice. He emphasizes the importance of setting goals and focusing on quality real estate in desirable areas, such as great school districts. By utilizing strategies like these, aspiring real estate investors can build their portfolios while minimizing initial investment and maximizing returns.
Focusing on desirable areas with good schools for long-term returns: Buying properties in desirable areas with good schools and building relationships with renters can lead to greater returns in real estate investment by driving up property values and retaining tenants
While buying a cheaper property with the intention of positive cash flow may seem attractive on paper, it might not always be the best investment strategy. Real estate advice from people who have limited experience or have only bought a few properties in different circumstances may not be accurate. Instead, focusing on buying properties in desirable areas with good schools, where appreciation is likely to be higher, can lead to greater returns in the long run. Southlake, Texas, is an example of such a place, where the high demand for housing in a great school district drives up property values. Building relationships with renters and offering them incentives to buy from you instead of renting can also help increase your chances of retaining tenants and turning them into homebuyers. Ultimately, buying it right, focusing on appreciation, and debt reduction are the three key factors to consider when investing in real estate.
Involving family in real estate brings benefits: Family involvement in real estate can lead to smoother lease transitions, additional income, and effective property management.
Having family members involved in real estate can bring numerous benefits, such as better communication, easier lease transitions, and increased urgency for filling vacancies. In the case discussed, the family's involvement allowed for a smoother transition when tenants were ready to move out, as well as the opportunity for additional income through real estate commissions. Additionally, having a family member as a real estate agent can provide peace of mind for investors, ensuring that their investments are being managed with their best interests in mind. The subtle reminder of a lease agreement and the offer to buy and tear up the lease for free can also encourage tenants to work with the landlord to find a mutually beneficial solution. Overall, involving family members in real estate can lead to stronger relationships, increased income, and more effective property management.
Long-term perspective and diversification lead to financial security: Having multiple sources of income and a long-term perspective can lead to financial security and independence
Having a long-term perspective and diversifying investments can lead to financial stability and security. The speaker, Tim, shares his experience of having a successful security rep firm but recognizing that it's not a sellable business. He then turned to real estate investing, viewing his properties as a herd of cattle that he's trying to get to market before retirement. He emphasizes the importance of looking at the horizon instead of getting bogged down by the day-to-day issues. He encourages doing something, even if it's not perfect, as none of the individual deals will make you rich or bankrupt you. He believes in having multiple sources of income, such as rental properties, inventions, royalties, and notes. By having a diversified portfolio and a long-term perspective, one can achieve financial security and independence.
Financial security through diversification: Having multiple revenue streams provides financial stability and can help weather market crashes or investment failures. Diversification is key, but focus and mastery in a particular area can also lead to success.
Having multiple revenue streams, or "legs" as the speaker refers to them, can provide financial security and stability. The speaker shares his belief that diversification is key to weathering potential failures or market crashes in any given investment or revenue stream. However, he also acknowledges the value of focus and the "one thing" approach, which can lead to mastery and success in a particular area. Ultimately, the speaker's personal preference is to have a multitude of projects and revenue streams, but he emphasizes the importance of being fully present and focused when working on each one. The speaker's analogy of a table with multiple legs to represent financial diversification is a powerful and memorable way to understand the concept.
Calculated risks and seeking guidance in real estate investing: Start small, find mentors, overcome tech challenges, and focus on strengths to succeed in real estate investing
It's important to take calculated risks and focus on what you're good at when it comes to real estate investing. Buying your first rental property is a step you can take relatively quickly, but it's crucial to assess the potential risks and consider seeking guidance from experienced mentors. Don't be afraid to start small and gradually build up your experience before taking on larger projects that may be beyond your current capabilities. Remember, mentors come before money, so find those who have achieved success in the areas you're interested in and try to learn from them. Additionally, don't let a lack of technological skills hold you back – seek help from others if needed. Tim, a listener who appeared on the podcast, did just that by hiring high school students to help him create a video submission for the Bigger Pockets podcast.
Balancing cash flow and appreciation in real estate investing: Educate yourself, make informed decisions, and be patient for long-term success in real estate investing by balancing cash flow and appreciation, focusing on stable markets, and choosing deals that align with your preferences and capabilities.
Successful real estate investing involves a balance between cash flow and appreciation. The speaker shares his experience of starting with cash flow-focused investments and later shifting towards appreciation-focused ones as his portfolio grew. He emphasizes the importance of buying in highly populated, appreciating areas and stresses that appreciation is not just gambling if the market is stable. The speaker also highlights the benefits of high-end real estate, such as fewer problems and higher quality tenants, but acknowledges that everyone should choose the type of deals that align with their preferences and capabilities. Ultimately, the key is to educate yourself, make informed decisions, and be patient for long-term success.
Diversifying Investments with Real Estate: Diversifying investments with real estate can lead to significant returns, considering benefits like appreciation and depreciation. Local market conditions and long-term vision are crucial. Effective communication and collaboration between partners or spouses are key to success.
Having a diversified investment portfolio, including real estate, can lead to significant returns, especially when considering the unique benefits of real estate such as appreciation and depreciation. The speaker's experience in Texas, where property taxes are high, illustrates the importance of considering the local market conditions and having a long-term vision. Additionally, effective communication and collaboration between partners or spouses are crucial in maintaining a successful investment strategy. The speaker's friend, Josh, found success by combining their real estate purchases with family vacations, creating a positive association with the investment process. Overall, the discussion emphasizes the importance of patience, strategic planning, and effective communication in real estate investing.
Effective partnership in real estate investments: Effective communication, collaboration, and creativity in financial planning can lead to substantial benefits for both personal and financial growth. Discuss and combine financial goals to maximize potential for growth, create mutually beneficial agreements, and consider using rental properties to fund education.
Effective partnership and alignment of financial goals within a relationship can significantly contribute to building wealth through real estate investments. The speaker shares an example of a man who successfully combined his family life and real estate portfolio by taking his family on vacations each time he bought a house. He also suggests creating mutually beneficial agreements, such as allowing a spouse to keep late fees in exchange for handling the related administrative tasks. The speaker emphasizes the importance of having a plan for wealth and encourages couples to discuss and combine their financial goals to maximize their potential for growth. Additionally, the speaker proposes a strategy for using rental properties to fund a child's college education, which not only provides an education but also teaches valuable skills and generates ongoing cash flow. Overall, the key takeaway is that effective communication, collaboration, and creativity in financial planning can lead to substantial benefits for both personal and financial growth.
Why invest in real estate for retirement?: Investing in real estate provides immediate cash flow, built-in equity, and potential appreciation, making it a powerful tool for securing financial stability and building wealth for retirement. Partnering with reputable companies and using technology can simplify the process.
Real estate investing can be a powerful tool for securing financial stability and building wealth, especially for retirement. Finding a strong "why" for investing is crucial, and having a supportive spouse is essential to avoid conflicts. Real estate investments can provide immediate cash flow, built-in equity, and appreciation. Partnering with reputable companies like Integra Development Group or BAM Capital can simplify the process and increase chances of success. Additionally, technology like Relay can streamline the process of opening a business bank account for your property. Overall, investing in real estate requires careful planning, research, and partnerships, but the potential rewards are significant.
Relay Fi: A Better Banking Solution with No Monthly Fees or Minimums: Relay Fi, a financial technology company, offers banking services through Thread Bank with no monthly fees or minimums, making it a convenient and cost-effective solution for managing multiple business accounts.
The speaker, Tim, expressed his frustration with managing multiple business accounts with his current bank and recommended Relay Fi as a solution due to its lack of monthly fees or minimums and easy sign-up process. He also shared that Relay is a financial technology company, not a bank, and that banking services are provided by Thread Bank. Tim then participated in a light-hearted segment answering random questions, which included revealing his deserted island companions of choice - Warren Buffett and Elon Musk, and expressing his admiration for their entrepreneurial minds. He also mentioned his love for the book "Elon Musk" and shared his appreciation for the innovation and ideas these two individuals bring to the table. Lastly, he mentioned his favorite apps, including CardDart, Uber, Control 4, BiggerPockets, and Twitter. In response to a question about working for the FBI or NASA, Tim chose the FBI, expressing his curiosity about the information and potential discoveries that could be uncovered. Overall, the conversation highlighted the convenience and benefits of Relay Fi's banking services and the admiration the speaker holds for successful entrepreneurs and innovators.
Stay informed, make quick offers, and be patient during the option period for successful real estate deals: Successful real estate investors prioritize speed and flexibility, using technology to stay informed, offering cash and large earnest deposits, and maintaining a patient and persistent approach during the option period to secure deals before others.
Successful real estate investors prioritize speed and flexibility in their deal-making process. They make use of technology to stay informed about new listings, offer cash and large earnest deposits to gain an edge, and maintain a patient and persistent approach during the option period. By doing so, they can secure deals before others and increase their chances of success. The speaker emphasizes the importance of seeing properties as soon as they become available and making quick offers. He uses a line of credit and always offers cash to put himself in a strong position compared to other buyers. Additionally, he advises against getting emotionally attached to earnest money during the option period, as it doesn't actually change hands until the deal is closed. Instead, he suggests focusing on the opportunity to inspect the property and secure the first position during this time. The speaker's strategies demonstrate the importance of being proactive and adaptable in the real estate market. By utilizing these tactics, investors can stay ahead of the competition and increase their chances of finding and securing profitable deals.
Making a Strong Offer in Competitive Markets: Seek advice from mortgage professionals for no-money-down or low-down-payment deals. Learn from experienced buyers and leverage their insights. Be resourceful and consider creative financing options.
In competitive real estate markets, making a strong offer can mean the difference between securing a property and being the bridesmaid. This can involve putting down earnest money or even using creative financing options. For those without cash, seeking advice from knowledgeable mortgage professionals can help uncover opportunities for no-money-down or low-down-payment deals. As one speaker mentioned, finding the smartest person you know and learning from their experiences can be a game-changer. Additionally, as real estate knowledge and strategies evolve, leveraging the insights of experienced professionals can help young buyers navigate the market successfully. One speaker shared how they recently refinanced multiple properties to access a large line of credit, which they now use to make competitive cash offers. By being resourceful and seeking guidance, buyers can increase their chances of securing the property they want.
Leveraging Equity for Multiple Property Purchases: Investors can buy multiple high-value properties with equity, focusing on desirable locations for long-term appreciation, even if some initially lose money. Managing properties requires effective property managers to ensure positive cash flow and growth.
With a significant amount of equity built up, real estate investors can continue buying properties without putting down large down payments. This strategy, known as house hacking, allows investors to buy multiple high-value properties and potentially still maintain positive cash flow, even if some properties lose money. This approach requires a long-term perspective and the ability to weather potential financial setbacks. When buying these high-value properties, investors may not prioritize cash flow as much as experienced investors might advise for new investors. Instead, they focus on desirable locations with strong demographics, good zoning, and excellent school districts. These areas are likely to appreciate over time, making them worth the investment, even if they initially lose money. Southlake, Texas, is an example of such a desirable location, offering a strong economy, desirable schools, and strict zoning regulations. Property managers can present challenges for investors due to conflicting goals, but their role is essential for managing properties effectively and allowing investors to focus on acquiring more properties.
Conflicts of interest in property management: Property managers may prioritize quick turnover and financial incentives over ongoing maintenance and tenant satisfaction, but a hands-on approach allows investors to learn and grow their skills.
Property management comes with potential conflicts of interest and financial incentives that may not align with the best interests of the property owner. The property manager's role is to act as an intermediary between tenants and property owners, but their payment structure can create a desire to turn over units quickly, leading to potential neglect of ongoing maintenance and tenant satisfaction. Additionally, having a hands-on approach to managing properties allows investors to gain valuable experience and learn the ins and outs of the business, making it a worthwhile endeavor for those who wish to retain control and grow their skills. Specific, detailed goals are essential for achieving success in real estate investing, as they provide clear targets and help break down larger objectives into manageable tasks.
Find your motivation through setting and achieving goals: Stay optimistic, set goals, find your 'why', celebrate accomplishments, and invest in real estate for long-term growth
Setting and achieving goals, followed by rewarding yourself, is a powerful motivator for personal growth and financial success. The speaker emphasizes the importance of finding your "why" and celebrating your accomplishments. He also believes that real estate is a sound long-term investment due to population growth, increasing labor costs, and rising material prices. For young adults starting out, he encourages getting started early, even with limited resources. Overall, the message is to stay optimistic, set goals, and enjoy the journey towards achieving them.
Take Action and Learn from Mistakes: Successful real estate investors take action, learn from mistakes, and don't let negativity hold them back. Barbara Corcoran emphasizes the importance of starting early and reading books by Robert Kiyosaki and Grant Cardone.
Action is key in achieving success in real estate, and in life in general. Barbara Corcoran emphasizes the importance of making offers and taking action, even if you make mistakes. She believes that starting early and learning from mistakes can significantly impact your trajectory. As she puts it, "Just do it. Figure it out. Go right now." Famous real estate investor Robert Kiyosaki's books, particularly "Rich Dad Poor Dad" and "Cash Flow Quadrant," have been instrumental in shaping her perspective. She encourages readers to start with "Cash Flow Quadrant" for a better understanding of the concepts. Barbara also enjoys reading Grant Cardone's books, such as "The Obsessed or Be Average," which emphasizes the importance of being relentless in pursuing your goals and not letting others' negativity affect you. Barbara's hobbies include working, real estate, sports cars, and gambling. She believes that successful real estate investors take action and learn from their mistakes, setting them apart from those who give up or never get started.
Learning from Experts and Successful Individuals: Seek mentors, emulate success, value their experiences, learn financially, and continuously grow through knowledge and relationships.
Seeking advice from experts and successful individuals is crucial for personal growth and financial success. According to Tim Shiner, 98% of people will never have a net worth of $1,000,000, making it essential to look for mentors and learn from those who have achieved what you aspire to. Shiner encourages emulating successful individuals, bringing value to them, and being willing to learn from their experiences. He also emphasizes the importance of financial education, which is often overlooked in schools. Shiner's book, "50 Things They Didn't Teach You in School," is a great resource for gaining knowledge on various topics, with all profits going to a food bank. Overall, Shiner's message encourages setting goals, having a "why" behind what you do, and continuously learning from others.
The Importance of Preparation in Real Estate Investing: Being prepared is crucial in real estate investing, from applying sunscreen to finding investor-friendly agents. Long-term benefits, focusing on time in the market, and utilizing BiggerPockets Agent Finder are essential strategies.
Key takeaway from today's interview is the importance of being prepared, whether it's applying sunscreen on a hot day or finding an investor-friendly real estate agent. The speakers shared their personal experiences and reminded listeners that being ready for various situations can make a significant difference. Moreover, they emphasized the long-term benefits of investing in real estate, regardless of market fluctuations. They encouraged listeners to focus on time in the market rather than trying to time the market. Additionally, they introduced BiggerPockets Agent Finder as a valuable resource for finding local market experts to help navigate the real estate investment process with confidence. This free service can help investors find the right agent who can provide valuable insights and support in their real estate journey. Lastly, they reminded listeners that investing involves risks, and it's essential to consult with qualified advisors before making any investment decisions. Overall, the interview provided valuable insights and practical tips for those interested in real estate investing.
