The art of real estate investing

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Begin to invest in your future with this residential investment course.
I can help you find the properties that make the most sense. Call to join my investor tour of homes.

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  • The most recent cycle showed _____________________appreciation. The economy was _______________________________. At the end of the decade there was a stock market ________________. There was also a bank _______________________. Values ___________________ and then ________________________.
  • The next cycle showed _____________________appreciation. The economy was _______________________________. At the end of the decade there was a stock market ________________. There was also a bank _______________________. Values ___________________ and then ________________________.
  • Home values did not decline in any ten year period since _________________________________________________
  • The art of real estate investing

    1. 1. Greg Rand, CEO
    2. 4. 5 Principles of Real Estate Wealth #1 Timing is Everything
    3. 6. Single Family Home Prices Recession Boom Begins Stocks and RE Rise Overheated Stock Mkt Crash Bank Bailout Real Estate Correction
    4. 7. Single Family Home Prices Recession Boom Begins Stocks and RE Rise Overheated Stock Mkt Crash Bank Bailout Real Estate Correction
    5. 12. Copyright 2011 - ReVest America, LLC Harvard
    6. 13. Copyright 2011 - ReVest America, LLC Rental Demand!
    7. 14. 5 Principles of Real Estate Wealth #2 Buy to Hold
    8. 15. 5 Principles of Real Estate Wealth #3 Cash Flow = Staying Power
    9. 16. <ul><li>Rent </li></ul><ul><li>-Operating Expenses </li></ul><ul><li>=Net Operating Income </li></ul><ul><li>-Mortgage Payment </li></ul><ul><li>= Cash Flow </li></ul>
    10. 17. <ul><li>Asking Price = $250,000 </li></ul><ul><li>Annual Gross Income $ 24,000 </li></ul><ul><li>Vacancy Rate 5% $ 1,200 </li></ul><ul><li>= Effective Gross Income $22,800 </li></ul>
    11. 18. <ul><li>Property Taxes </li></ul><ul><li>Insurance </li></ul><ul><li>Attorney/Accounting Fees </li></ul><ul><li>Property Management </li></ul><ul><li>Repairs and Maintenance </li></ul><ul><li>Utilities </li></ul><ul><li>NOT Mortgage Payment </li></ul><ul><li>Total for Example $ 8,000 </li></ul>
    12. 19. <ul><li>Effective Gross Income $ 22,800 </li></ul><ul><li>- Operating Expenses $ 8,000 </li></ul><ul><li>= NOI $ 14,800 </li></ul>
    13. 20. <ul><li>If I invested my cash with no mortgage, what would be my annual return? </li></ul><ul><li>NOI $ 14,800 </li></ul><ul><li>÷ Purchase Price $250,000 </li></ul><ul><li>= CAP Rate 5.9% </li></ul>
    14. 21. <ul><li>If I invested my cash with no mortgage, what would be my annual return? </li></ul><ul><li>NOI $ 14,800 </li></ul><ul><li>÷ Purchase Price $225,000 </li></ul><ul><li>= CAP Rate 6.6% </li></ul>
    15. 22. <ul><li>Asking Price $250,000 </li></ul><ul><li>30% Down Payment $ 75,000 </li></ul><ul><li>= Mortgage Amount $175,000 </li></ul><ul><li>Annual P&I (6%=$1049/mo) $ 12,588 </li></ul>
    16. 23. <ul><li>Effective Gross Income $ 22,800 </li></ul><ul><li>Operating Expenses $ 8,000 </li></ul><ul><li>= NOI $ 14,800 </li></ul><ul><li>- Debt Service $ 12,588 </li></ul><ul><li>Cash Flow $ 2,212 </li></ul><ul><li>÷ Cash Invested (w/closing costs) $ 80,000 </li></ul><ul><li>Cash on Cash Return 2.8% </li></ul>
    17. 24. <ul><li>Gross Income </li></ul><ul><li>- Vacancy Rate </li></ul><ul><li>= Effective Gross Income </li></ul><ul><li>- Operating Expenses </li></ul><ul><li>= Net Operating Income (NOI) </li></ul><ul><li>÷ Purchase Price </li></ul><ul><li>= CAP Rate </li></ul>
    18. 25. <ul><li>Gross Income </li></ul><ul><li>- Vacancy Rate </li></ul><ul><li>= Effective Gross Income </li></ul><ul><li>- Operating Expenses </li></ul><ul><li>= Net Operating Income (NOI) </li></ul><ul><li>- Debt Service </li></ul><ul><li>= Cash Flow </li></ul><ul><li>÷ Cash Investment </li></ul><ul><li>= Cash on Cash Return </li></ul>
    19. 26. 5 Principles of Real Estate Wealth #4 Appreciation = Wealth Forbes.com
    20. 27. 5 Principles of Real Estate Wealth #5 Real Estate Ownership is a Business
    21. 30. 1. Establish a Long-Term View
    22. 31. 2. Set Financial Expectations
    23. 32. 3. Get Away From Get-Rich-Quick Schemes
    24. 33. 4. Identify Motivation: Long Term Goals
    25. 34. Compartmentalization
    26. 35. 5. Determine Aptitude
    27. 36. 6. Go Shopping
    28. 37. Greg Rand, CEO

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