Strategies

Real estate investors disagree on many topics, but one that nearly all agree on is the necessity of investing in yourself. There are literally thousands of books out there that deal with real estate investing, and I’ve probably read most of them! The following list is the top of my top.  Without further suspense, I give you my Top Books For Real Estate Investors:

The Best Books for Real Estate:

The Book on Rental Property Investing by Brandon Turner

The Book on Rental Property Investing 3D Cover MASTERCash flow and wealth don’t happen overnight. But if you are willing to work hard and invest smart, this book is designed to help you achieve your financial goals through the power of rental properties! This book will give you practical, real-world advice for those looking to build wealth and cash flow through rental properties! You’ll learn:

You’ll learn:

  • Why Many Real Estate Investors Fail (And the mindset, processes, and systems you’ll need to succeed.)The-Book-on-Managing-Rental-Properties-3D-Cover-SMALL-No-Background-copy-208x300
  • Numerous Easy-to-Follow Strategies (Gurus love to tell you about some single “secret” method to build wealth. Instead, you’ll learn numerous!)
  • Finding Deals, Financing Properties, Management, and More. (This comprehensive guide will give you exactly what you need to get your first, or next, rental property.)

You can get this book alone on Amazon, or get it on BiggerPockets and get $500 of bonuses FREE including The Book on Managing Rental Properties!

The Unofficial Guide to Real Estate Investing by Spencer Strauss

The Unofficial Guide to Real Estate InvestingSimply put, this book is amazing. From making a plan, buying your first property, fixing things up, managing property, to selling for premium prices  – it’s all here.  This book was the inspiration for the real estate strategy that I used in my life to grow my portfolio, and also the inspiration for my other short (free) book “7 Years to 7 Figure Wealth” which you can get for free later on this list!Overall, this book is an excellent summary of the whole process of buying an investment property.

Rich Dad Poor Dad by Robert Kiyosaki

Rich Dad Poor DadThere may be a lot of hype and motivational talk in this book (not to mention the Rich Dad marketing machine you see everywhere), but this classic among investors contains an unbelievable amount of life-changing, thought-provoking content. Rich Dad is all about opening our minds to the possibilities of letting our money earn money, rather than our time. Kiyosaki does an excellent job of putting to words what I had been feeling in my heart for a long time.

Rich Dad’s ABC’s of Real Estate Investing and Rich Dad’s Advanced Guide to Real Estate Investing by Ken McElroy.

Rich Dad's ABC's of Real Estate Investing
These are two books that work as a team to teach one huge method of investing in real estate – multifamily investing.  These two are the best books on “big picture” real estate investing through apartments I’ve read.

If you want to start making serious money in real estate, check these two books out.  Also, these books contain the best descriptions and examples of harnessing the power of cap rates while investing in real estate.

The Book on Investing in Real Estate with No (and Low) Money Down by Brandon Turner

f8e37d4f-no-money-3d-book-cover-png_0aj0f60aj0f6000000Looking to get started using other people’s money? Struggling to find out how to pay for your first (or next) property?  This is the one book on this list you CAN’T afford to miss (see what I did there?!)  Usually the term “no money down” is synonymous with the late night TV gurus with big hair, big smiles, and big promises – but this book is different. It’s not about one “secret” strategy – it’s about numerous strategies used  by real investors in today’s market – both newbies and advanced.   Of course I’m a little biased on how awesome this book is – because I wrote it, but being one of the top real estate books on Amazon definitely validates my bias!If you want to pick up a copy of this (either digital, physical, audio – or all three) head over to BiggerPockets.com/nomoney and get it!

 

The Four Hour Workweek by Tim Ferriss

The Four Hour WorkweekWhile not about Real Estate at all, The Four Hour Workweek is still an excellent book on living outside the “status quo” of slave, save, retire, die. It transformed the way I look at the world, retirement, money, etc.  I recommend this book to almost every person in any field.

might be turned off by Ferriss’ “personality” and bravado but I find the information and motivation invaluable. If you are feeling overwhelmed by life and the busyness of it, don’t skip this one. I think you’ll like it.

Landlording on AutoPilot by Mike Butler

Landlording on AutoPilotMike Butler’s book is hands down the best book on being a landlord for single family homes. There is so much good information in this book about dealing with tenants it is insane. This single book helped me dramatically to improve my landlording business and make my business so much

If you are struggling at all with being a landlord or fearful of jumping into real estate because of the thought of being a landlord, read this book.

 

Other Great Real Estate Books: Honorable Mentions

BiggerPockets.com

Okay, Bigger Pockets may not be a physical book.  It’s actually the world’s largest real estate community.  However, anything you could ever learn in a book is found on this site.  Tons of investors, lots of info, amazing stuff. Really, this site taught me a lot about real estate investing. Now I am one of their contributors to their blog (which is super-duper cool). Seriously any question you have about rea estate (besides asking me, which you totally can and should!) you can ask in the forums and you’ll get a bazillion seasoned real estate investors to answer you. It’s a living book. I love it.

7 Years to 7 Figure Wealth7 Years to 7 Figure Wealth by … me!

  Ok, it’s a shameless plug, but I had to include this book in the list! If you want to check it out, it’s 100% free and you can download it right now.  This book is a complete summary of my investment strategy and one avenue to earn a million dollars in real estate purchasing only five properties in seven years with almost no money.

What Every Real Estate Investor Needs to Know about Cash Flow… And 36 Other Key Financial Measures by Frank Gallinelli.  This book is about math, and making that math easy. If you don’t understand the principles discussed in this book, you will never be successful in real estate or any business, period.  If you want to understand it fully, devour this book and keep it on your shelf. This is definitely not a “check out from the library” sort of book.  (Also, read “The Buy and Hold Guys'” interview with Frank Gallinelli here)

Investing in Duplexes, Triplexes, and Quads: The Fastest and Safest Way to Real Estate Wealth by Larry Loftis. This book, as the title suggests, is my favorite book dealing with small multifamily properties. Being one of the first investment books I read, it really opened my eyes to what is possible out there, and caused me to buy my first duplex – which still brings me almost $400 per month in cashflow. I owe that purchase and success to this book.  If you are just starting out, I highly recommend this book.

Set For Life 3DSet For Life by Scott Trench. Scott is a great friend of mine and one of the smartest people I know. He wrote this FANTASTIC book that anyone under the age of 40 needs to read. Like… right now. Seriously – it’s life changing. It’s all about how to set up your life so you can achieve financial freedom sooner than you’d ever imagine. Part real estate, part personal finance, part motivation, and 100% awesome. Read it.
How to Manage Residential Property for Maximum Cash Flow and Resale Value – By John T Reed. This hard-to-find book (he doesn’t sell on Amazon – just on his website) is really like an encyclopedia on managing large multifamily properties. Known for his straight-forward, no-fluff attitude, Reed has thousands and thousands of tips on managing larger properties. I re-read this book at least twice a year and learn new things every time.  I have not (yet) read his other real estate books, but if they are anything like this one, they will be amazing. 

[FREE] 20 Ways to Buy a House for $2,000 or Less – Written by Ben Leybovich, and 100% FREE for you to read, this book contains a TON of great suggestions for buying real estate using other people’s money. In a way, this was the book that inspired me to write “The Book on Investing in Real Estate with No (and Low) Money Down.” In addition to this free book, Ben offers a ton of other great content for free, so be sure to download all his free content.

 ***Update – Check out the sequel to this post titled, “Seven MORE Must Read Books for Real Estate Investors”  ***

What are your favorite real estate investing books? List them in the comments below!

P.S. looking for hard money loans in California? Be sure to check out my friends over at northcoastfinancialinc.com. They have very competitive rates, can fund within a week and specialize in fix and flip loans and other hard money loans.

Today I am honored to have my favorite real estate investor and property manager in the entire world write for me… my wife! Heather has been my constant companion on my journey through real estate investing and the reason for my success so far. She is not only the best property manager I have ever known, but she knows the business of real estate investing inside and out and has a heart to help others as well.

 

As someone who entered the world of landlording at the ripe young age of 23, I have had my fair share of dealing with tenants who take one look at me, and use that as ammunition they tuck away for later use when they need someone to walk all over.  Sometimes, it’s written all over their face:

  • Inexperienced
  • Soft
  • Easy
  • Pushover

Great first impression, isn’t it? This is why over the last few years, I have developed a system that not only works for the fresh-faced beginner-landlord, but should be implemented by any and all landlords wishing to have a successful business relationship with their tenants.

 

It Starts with Being Knowledgeable.

 

The best ways to do this? Read. A lot. There are so many wonderful books out there on landlording that offer great ideas, strategies, and tools you can use in all sorts of situations you might suddenly find yourself in. I have three favorite books that I believe every landlord should read, highlighter in hand, at least at some point in their career:

Landlording on AutoPilot” by Mike Butler

The Unofficial Guide to Managing Rental Property by Melissa Prandi

How to Manage Residential Property for Maximum Cash Flow and Resale Value” by John T. Reed

Become familiar with your state’s landlord/tenant laws. I have my Landlord Tenant Act printed and tucked away nicely in a file for quick reference.

Also, the internet has a plethora of information from landlords of all shapes and sizes. The information and perspectives from BiggerPockets.com alone is enough to satisfy anyone looking for landlording advice.

Get together with other landlords. If there is one thing I’ve learned, landlords love talking about their experiences. Listen and learn!

The point is, don’t go through landlording blindfolded. Know what you’re getting yourself into, and have a solid foundation on which to build upon.

Have a Written Policy.

 

All that knowledge you learned? Personalize it to fit your business model and write it down. Cover everything. When a tenant has a question, instead of the answer coming from you, the landlord, it comes from the policy. Example: “My boyfriend got me a puppy for my birthday, can I keep it?” Answer: “I’m really sorry, but our policy states that no pets are allowed at that property.” Having the policy written down helps protect you from succumbing to your sensitive side that thinks on the spur of the moment, “Maybe just ONE puppy wouldn’t be so bad.”

Nope, it’s bad.

Your policy is there to protect you from yourself 🙂 Also, be sure to:

  • Be Up Front. Once you have your policy in place, don’t be coy, make sure your tenants know what those policies are. They should be in your Rental Agreement or Lease, which your tenants should have a copy of.
  • Be Consistent. The Rental Agreement I use with my tenants states that rent is due on the first and considered late after the fifth. On the sixth, if rent hasn’t been received, the tenant gets a $50.00 late fee and a 3-Day Pay or Vacate Notice per our policy and the terms in their Rental Agreement . The tenant is made aware of this when they move in, so it comes as no surprise when on the sixth they receive a late notice. When you are consistent, you are training your tenants to do things on your terms, which if you ask me, is a much wiser decision than doing things on theirs.

Follow Through.

 

This includes everything from completing tenant requested maintenance to enforcing your policies.

We once had a tenant in one of our 2-bedroom apartments that decided to get a young lab. Their Rental Agreement and our policy both stated that no pets were allowed on the premises. As soon as I was made aware of dog in the apartment (it’s difficult to hide a 60-pound dog in a 24-unit apartment complex!), I contacted the tenant by phone and reminded them of the strict “no-pet” policy and gave them a date by which the dog would have to be gone. When that date rolled around and the dog was still residing in the apartment, the tenant was given a 10-Day Notice to Comply with their Rental Agreement or immediately vacate the premises. On the tenth day, we did a thorough walk-thru of the home and confirmed the dog had been re-located.

Now, I wonder what would have happened if we hadn’t followed through? I can tell you: that apartment would still have one fluffy, yellow, 60-pound tenant.

Be Professional.

 

Landlording is a business, and as with any successful business, it’s important to always be on your best behavior. This includes the way you interact with your tenants, your appearance, written correspondence, returning phone calls promptly, etc. If you’ve been in the landlord role for any time at all, I’m sure you found out quickly that tenants can be the exact opposite. You can’t control them though, you can only control you. Set the precedent for your tenants that you are a professional business.

When my husband and I started out we essentially started our own property management company for our own rentals. We have a professional name, separate phone-line, operating hours (10-4 Monday thru Friday, with an emergency number for after-hours maintenance issues that can’t wait), logo, letterhead, standard forms, policies, maintenance crew, signs, etc. We answer the telephone with, “Thank you for calling (Company Name).” By doing this, it gave us the professional face we were looking for, and bonus, instantly gave us a higher authority to refer to.

Obviously not everyone needs to go so far as creating a company to run their business through, but the point is that you control how you appear to your tenants, and that appearance sets the precedent. If you want to be taken seriously, be professional in all situations, even when they’re not.

Offer a Quality Product.

 

Don’t be a slumlord. This doesn’t mean your rental has to look like it came straight out of Better Homes and Gardens, but give your tenants a clean home, something they can feel good in and show off to their friends. Also, generally the better product you offer, the better quality tenants you attract, and the better they will care of it while it’s in their possession.

Be Above Reproach.

 

Act with integrity. Don’t give your tenants a valid reason to complain.

Notice I said valid. Tenants complain, because unfortunately, in the tenants mind the landlord is the big, bad, rich guy taking advantage of everyone and their grandmother. But that doesn’t mean you have to be the stereotypical landlord. Do what you say you are going to do, when you say you’re going to do it. If your tenants have something to hold over you, trust me they will. So, why give them the opportunity? Doing this won’t stop the complaining or the stereotype, but you will always be one step ahead.

Final Thoughts

 

Obviously, these steps aren’t the magic formula for creating and maintaining a successful landlording career; however, they do set you up to have a tough time avoiding it. Simply know what you’re about, have a plan, and follow that plan. Whether you’re a beginner or seasoned, young or…wise (wink!), set yourself up to not only succeed, but exceed in this business.

P.S. looking for hard money loans in California? Be sure to check out my friends over at northcoastfinancialinc.com. They have very competitive rates, can fund within a week and specialize in fix and flip loans and other hard money loans.

 

This list might look familiar for those who have downloaded my free e-book, “7 Years to 7 Figure Wealth,” but I thought I’d share it here for everyone else and dive in a little deeper explaining each item more fully.

Also, I’ve got big news about my newest property acquisition coming out later this week!  Be sure to get automatic updates by entering your email in the bar at the top of this page and sign up for my newsletter by entering your email on the right (I know, there is a lot of signing up around here! I promise I don’t use your email for bad purposes!)

So without further ado, here is:

Ten Ways to Fail as a Real Estate Investor:

  1. Don’t Read- If you really want to stop moving forward, stop reading about investing. Don’t learn new strategies, because you will be left in the dust when the market changes. Don’t read quality real estate blogs or download a free e-book. (shameless plug, I know!)
  2. Don’t Connect with Other Investors – Associating with other investors will give you confidence and knowledge, as well as help navigate muddy waters. Therefore, be sure to steer clear from other investors. Especially don’t join websites like BiggerPockets.com or your local real estate investment club.
  3. Don’t Have A Plan – Knowing the direction you want to go will only get you there faster. Instead, simply aimlessly “invest” in whatever floats your boat at the moment.
  4. Only Listen To Gurus – Pay lots of money to attend seminars full of up-sells and “hidden secrets.” Make sure you only listen to them and don’t ever question their dated information or underhanded sales techniques.
  5. Do Everything Yourself – By stretching yourself thin, you will lose both interest and money – so be sure to never ask for help or hire a professional.
  6. Run Your Business On Emotion – Don’t be rational when making business decisions. Instead, rely on how it feels at the moment. Feel bad for tenants who spend their money on drugs instead of rent and give them another break.  Be sure to take everything personal as well and take our your frustrations on your family at home.
  7. Get Fancy and complicated – Investing is fairly straightforward and simple, so if you want to fail – be sure to get real fancy and complicated. Using seventeen layers of LLC protection, cross-collateralize everything you own, and take huge risks to help speed up the process of failure.
  8. Spend your money frivolously – There are many ups and downs when investing in real estate, so be sure you don’t save enough money to cover you in the down times. Be sure to leverage yourself out as thin as possible, buying the best new cars and toys so you look as rich as you want others to think you are.
  9. Don’t stick to your standards– following a recipe is for those who want the food to turn out tasting delicious. Instead, deviate as much as possible, buying property that doesn’t meet your standards and rent to tenants who would never qualify. Combine this with number six above for even faster failure.
  10. Wait Until Tomorrow –You will never succeed if you don’t start, so make sure you sit back and watch one more episode of Desperate Housewives. You can always invest when you have more time, more energy, and more desire. Besides, the government will take care of you when you retire.

 

Do you have other ways to fail you want to add to the list?  Comment below and let me know! (That rhymed. I’m a poet and I didn’t know it!)

Also, if you enjoyed this article, share it by using the buttons below!

 

Image courtesy of FreeDigitalPhotos.net

P.S. looking for hard money loans in California? Be sure to check out my friends over at northcoastfinancialinc.com. They have very competitive rates, can fund within a week and specialize in fix and flip loans and other hard money loans.

 

This is a post (the second in a three-part series) by John Fedro of MobileHomeInvesting.net

In my last post here at RealEstateInYourTwenties.com, I introduced myself, teased you with my simple cash-flow generating secret tool, then KAPOW!! – completely threw you a curve-ball by divulging my money-making strategy is investing in small, individual, easy-to-close mobile homes in and out of mobile home parks. I need to be brutally honest with you for the next minute…

Before we get into the meat of a cash-flow deal (next post) and talk about where all our money is made, you have to understand why sellers will sell you their unwanted mobile homes for such low prices; and conversely, why buyers will pay over retail prices for the same mobile homes. Much like any j.o.b. – you must understand your product, market, and all the players before you may truly thrive.

1. Understand Your Target Homes:

The mobile homes that will make you the most money are often times not the ones you would first believe. In a nutshell 3 bedrooms almost always outsell 2 bedrooms, and clean mobile homes always outsell mobile homes that need repairs. But what else… If you have been in real estate for any length of time you understand that it is not the cleanest or largest homes that make the most money but it is the more motivated sellers that you are truly after. The more motivated the seller, often times the more lucrative the deals end up becoming.

2. Understanding Your Buyers:

Approximately 80% of your end-buyers that call from your “Mobile Home For Sale” advertisements will not have the cash or approved credit to pay you all-cash for your mobile home. Another way to say this is that most mobile home buyers can make you a move-in payment and monthly payments for the sales price of the home. Understand that there is an ocean of buyers looking to buy a home with monthly payments instead of paying with all-cash.

What about buyers with all cash? These buyers are out there but in far less supply than buyers with some cash and great job history. Go where the demand is… payment buyers.

What about bank financing? Bank financing is very hard and restrictive to obtain especially concerning mobile homes on rented land such as inside a mobile home park.

There is a large segment of American society that are credit-conscious, hard-working and honest folks that would love to stop renting and finally own a mobile home of their own. If you choose to sell a home for all cash you are competing with all other sellers looking to sell their properties for all cash; driving home prices lower and lower. If you choose to accept monthly payments for your mobile home you can likely find tenant-buyers eager to pay over retail price for the value/opportunity to own a beautiful home.

3. Understanding Your Sellers:

My real estate investing business changed forever when I began to see my sellers for what they really are; fragile, scared, vulnerable, friendly, and selfish human beings. Let’s step outside the relationship that we typically have with mobile home and traditional real estate sellers and realize that each is a unique soul with his or her own set of skills, ambitions, loves, fears, and wants.

So what does all this mean for you: In a nutshell sellers are real people in real situations. Some sellers need to sell today, and others can wait weeks, months, or even years before becoming desperate to sell. Again some sellers are at the end of their ropes, while others have enough savings/income to ride out whatever situation is requiring/pushing them to sell. By being a mobile home investor in your area you may close deals and generate cash-flow by knowing your market and knowing what buyers will pay.

In my next post here at Realestateinyourtwenties.com you will discover an simple method to help ensure you underpay for every mobile home you purchase.

 

Impact a life daily,

John Fedro

John@mobilehomeinvesting.net

P.S. looking for hard money loans in California? Be sure to check out my friends over at northcoastfinancialinc.com. They have very competitive rates, can fund within a week and specialize in fix and flip loans and other hard money loans.

Hey everyone!

After many days of writing and editing, my first eBook has arrived and I’m giving it away for free! Yep, just as a gift for hanging out at Real Estate In Your Twenties.

And yes, you can still get the eBook free if you are thirty, forty, or a hundred years old!

Simply add your name and email to the box below!

Also, let me know your thoughts about the book!

P.S. looking for hard money loans in California? Be sure to check out my friends over at northcoastfinancialinc.com. They have very competitive rates, can fund within a week and specialize in fix and flip loans and other hard money loans.

Looking for the “right” home to buy can take a lot of time and effort, especially when trying to comb through the hundreds or thousands of deals that are on the market today. It is important not to waste time and maximize your efforts (see my last post on the 80/20 principle).  The following is the quick mental math that I use to analyze a single family home quickly and decide if it’s even worth looking into.

First, I only look for homes in areas that I am financially comfortable with. So, if I am not comfortable with the average sale prices, rent prices, days on market, etc of a given area – I learn that first. I live in a fairly small community, so it is fairly easy where I live.  If you live in a large area, like a major city, you should be focused on a small area that you can fully wrap your mind around. Never invest where you don’t know the market.

Second, I determine how much it is going to cost me to rehab the place. This is a VERY loose number, and generally just use $10,000 for a small paint/carpet turn,  $20,000 for a medium turn, and $30,000 for a major remodel. This includes labor, material, closing costs, and holding costs.

Third, I look at the purchase price and add the repairs. So, if I found a house for $65,000, and it needed $10,000 in repairs, I use the number $75,000.

Fourth, I then take that final number and knock off two “zeros”. This gives me a good estimate of my monthly mortgage payment with taxes and insurance. So $750 becomes $750 per month. I know this is a bit high, but I like to be conservative.

Fifth, I add a few hundred for vacancies, repairs, etc. So I might say this property is going to cost me on average $1000 per month.

Finally, I just need to know what the average rent will be. If the average rent, on the low side, will give me $200 per month in cashflow, this is probably a deal worth looking into. If not, I’ll move on. Additionally, if the total cost I would have invested in the  the property is $20,000 less than it’s value, then I will also move forward.

I believe any property needs to have both positive cashflow and good equity. There are too many good deals today to buy something that doesn’t have both.

That’s pretty much my quick and easy strategy to sort through all the listings to find a gem. I do this whole process in about thirty seconds per home, and it has worked great for me. Obviously, if I decide to pursue it in more detail I will learn exactly how much repairs are going to cost, what the mortgage will be, and more. This is simply a very quick way to sort out 90% of the deals and only focus on the ones that might be good.

 

image credit: NNECAPA

 

P.S. looking for hard money loans in California? Be sure to check out my friends over at northcoastfinancialinc.com. They have very competitive rates, can fund within a week and specialize in fix and flip loans and other hard money loans.

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