Fri, 31 May 2019
1206 FBF: Client Case Study, Clay Slocum: Compounding Returns, Asset Protection, Appreciation Rates & Taxation
Today's Flash Back Friday comes from Episode 892, originally published in October 2017.
Jason welcomes client, Clay Slocum to the show. Clay is a millennial who currently has four properties in his real estate portfolio. Before buying his first property, Clay worked diligently with Oscar, his Investment Counselor, and a Local Market Specialist to play around with the numbers and he discovered his initial investment could grow exponentially. Clay shares his insights on the power of compounding interest, asset protection, and the Memphis market.
[01:10] Jason comments on the Las Vegas terrorist attack.
[09:30] Compound interest can be a powerful tool against inflation.
[15:12] Engineers take an analytical approach to investing.
[17:22] After 18 years, $100,000 grow to 14 million.
[24:43] Jason explains a Deferred Sales Trust.
[28:39] If you are on the fence about investing talk with an investment counselor.
[39:33] Asset Protection is a complicated subject you should speak with a lawyer about.
[48:58] Resources for tax help.
Mentioned in This Episode:
Thu, 30 May 2019
1205: CapEx Repairs, Home Inspections & Market, Screen, Lease, Collect, Maintain & Accounting Self-Management Tool UpTop by Frank Barletta
Jason Hartman and Adam kick off today's episode answering some listener questions from Brenda and Roger. They want to know about how Jason's family was able to make real estate investing work in California, as well as planning for CapEx repairs as a landlord.
Then Jason talks with Frank Barletta, Co-Founder and CEO of UpTop, about how his software can help self-managing property owners. Frank explains how UpTop helps landlords deal with leases and maintenance requests, as well as how to use the platform.
[3:26] Listen Question from Brenda: Jason doesn't like investing in California but his Aunt has successfully invested in Sacramento, CA. How did she succeed?
[5:58] Real estate as an asset is so powerful that it can turn decent investments into great investments over time
[8:12] How to account for large CapEx repairs
[11:46] It's crucial to look at your inspect report thoroughly and make sure the items that were supposed to be done were done properly so you don't get surprise expenses later
Frank Barletta Interview:
[18:56] What does a landlord do with UpTop?
[21:56] Where UpTop makes its money
[27:01] How UpTop handles leases
[27:48] Dealing with maintenance issues through UpTop
Wed, 29 May 2019
Jason Hartman talks with his Local Market Specialist from the Jacksonville/St Augustine markets about what led him start working in these markets, as well as what types of properties are available. The markets offer new construction single family, duplexes, and short-term rentals for purchase that all cash flow.
[4:35] When Bakersfield real estate stopped making sense, this LMS realized that Florida seemed like a good market
[7:20] The media's attempt at scare tactics for investing in real estate can tell you where we are in the cycle
[13:34] Jacksonville is still below peak pricing
[19:19] The 3 types of properties the Jacksonville/St Augustine markets provide
[24:02] Who are the short-term rental target tenants?
[27:32] You can cash flow expensive properties, but you have to do it in a different way
Tue, 28 May 2019
Jason Hartman and Adam examine the Investopedia article they referenced yesterday referring to the 9 common effects of inflation. The 2 types of inflation (cost-push and demand-pull) are also broken down in regards to how they impact your property value and rent.
Then the two examine what impact the Trade War with China could have on the markets properties are available in. If production from overseas come back to the United States, where are we likely to see the impact?
[4:18] The 9 common effects of inflation
[9:15] The land value is the one that's susceptible to big swings in value
[12:48] Cost-push versus demand-pull inflation
[15:57] How the Trade War could create cost-push inflation in the linear markets we're investing in
[19:12] If China ever manages to create a middle class they're going to have to deal with a new set of issues, which might make them an inopportune producer
[23:59] When labor shortages hit construction it can make it incredibly expensive to build a house and retain the workers needed
[28:39] Once the Trade War has ended, look at what job sectors are going to be impacted most and adjust your investing strategy accordingly
Mon, 27 May 2019
Jason Hartman and Adam take today's episode to discuss the growing trend toward a renter nation. But this trend isn't just for the young, it's for all age ranges. Renters in the 60+ demographic have seen an even bigger percentage increase than those in the 20-34 or 35-59. This is phenomenal news for landlords, as more people are competing to live in your properties.
They then look into the market for pre-fabricated homes, the impact of recent Airbnb decisions, and a brief glimpse at the 9 effects of inflation that will be discussed further in Tuesday's show.
[3:12] The over 60 demographic has seen a 43% increase in renters in the past decade
[6:52] A survey has found that few millennials are viewing home ownership as a necessity
[9:38] How the pre-fab home market is distorted to make it appear to be a cheap alternative
[16:18] A look into one of Jason's blogcasts on wealth creation
[20:34] Airbnb is giving up the addresses of 17,000 units to New York City.
[24:42] A brief look at the 9 effects of inflation
Fri, 24 May 2019
Today's Flash Back Friday comes from Episode 876, originally published in March 2017.
Jason and Investment Counselor Sara discuss the indirect impact of Hurricane Harvey in Houston. It may be one of the worst natural disasters in our nation’s history but an opportunity for rebuilding also exists. Prices will increase for commodities needed for rebuilding the area and labor will be needed in all sectors for those who were directly impacted by the storm.
[01:37] Disaster Capitalists make the most of the tragic flooding in Houston.
[05:25] A moratorium on mortgages benefits those with the most debt.
[11:09] Is it smart to buy properties on the cheap in Houston?
[12:32] How should investors handle damage to their existing properties?
[15:28] The cost of commodities always increase after a natural disaster.
[22:41] Laura wants to know how Jason's single-family portfolio homes performed during the 2008 recession.
Administrator@realestate.com - Free 1-hour onboarding session
Thu, 23 May 2019
Jason Hartman talks with Cynthia Kane, author of How to Communicate Like a Buddhist, as well as Talk To Yourself Like a Buddhist, about how we should be communicating with ourself and with others. Too often we say things hurtful to ourselves and our loved ones which we don't even realize until it's too late. Cynthia explains the elements of right speech that will point us in the right direction, as well as the importance of silence.
[3:23] The most important conversation you can have is with yourself
Cynthia Kane Interview:
[5:50] How does communicating like a Buddhist help you?
[9:39] The importance of "Mindful Listening"
[12:09] How we can use silence in a positive way
[19:43] How do you talk to YOURSELF as a Buddhist?
[23:47] You need to pump yourself up with self talk a little bit
[25:38] The importance of questioning
Wed, 22 May 2019
Jason Hartman and Adam take today's episode to discuss a new commandment Jason thought of while on the radio in Georgia after the recent Venture Alliance Mastermind event. They also discuss how Commandment #3 would protect investors from some of the exorbinant compensation packages that CEOs are taking that are harming stock holders.
Then Jason recaps the weekend and some of what he learned about tax liens and deeds and potential new markets that he visited while heading home from the event.
[3:04] The compensation of CEOs like Elon Musk shows why you should always maintain control (Commandment #3)
[8:16] Commandment #21 was created just this weekend
[15:02] Cuba doesn't have the port capacity to handle large cruise ships, so you have to take one of the smaller ones
[23:18] Early bird pricing ends June 4
[24:29] The Venture Alliance Mastermind weekend recap
[30:32] If you're going to invest in short-term rentals, make sure that the numbers work even if you have an increase in vacancy and a drop in prices during the next downturn
Tue, 21 May 2019
Jason Hartman and Adam start today's show answering a listener question about the value of local real estate investor associations. Jason has some dueling thoughts on the matter, and explains why you need to be wary when joining one.
Then Jason talks with Kelly Alexander, founder of Great American Tax Remedy, about how Kelly has been able to avoid paying Federal income tax since 2014. Kelly's method hasn't had to hold up against an IRS audit, but she's confident that what she's doing is completely legal and can help anyone out.
[4:47] Jason's thoughts on real estate investor organizations
[9:26] Do not fall for the "flavor of the month" or "get rich quick" schemes that you'll hear at some meetings
Kelly Alexander Interview:
[13:40] How Kelly's tax plan to avoid income taxes works
[17:17] Who else is using Kelly's technique?
[18:38] What Kelly does when she gets paid in order to avoid income tax
[28:36] How to report your income on your taxes under Kelly's format
[38:48] Why Kelly's strategy works for both state and federal taxes
Mon, 20 May 2019
Jason Hartman and Kerry take today to look at some of the signs in our economy today that don't point toward a rosy future. But don't take that to mean the sky's falling and we're headed for a doomsday scenario, we've still got some runway left.
The two also discuss how self-management can show you things that you wouldn't have known just sticking with a property manager. You don't HAVE to self-manage, but it's important to know how to self-manage so you don't get taken advantage of by your current manager.
[2:39] There are ominous signs out there for the economy, so we'll see how much longer it can hold them off
[5:47] For the first time in a long time, Kerry is bullish on the New York real estate
[13:13] Where will the next recession come from?
[17:05] There's an urgency that you need to do something now rather than waiting around
[21:04] Why Kerry thinks Indiana has been the longest running market for Jason's company
[25:19] Utilize your tenants as your assets
[30:51] If you choose to self-manage, remember to track ALL of your expenses
Fri, 17 May 2019
1196 FBF: Inflation: The Best Business Plan For Governments & Central Banks - Never Bet Against The Fed
Today's Flash Back Friday comes from Episode 887, originally published in September 2017.
The US is facing a looming financial crisis. In this episode, Jason outlines six business plans the government can use to ease its inflationary pressures. Four of the plans could result in negative outcomes, while the final two plans could achieve debt repayment by way of inflation. Understanding inflation and all of its aspects are not for the light-hearted. Jason explains inflation, how the government reports on inflation and offers up some educational resources for those who want to know more.
[04:35] Technology is changing the game in all aspects of life.
[11:15] Meet the Master's of Income Property Event is a 3-day event in January 2018.
[14:15] Jason identifies 6 ways to deal with inflationary pressures.
[21:17] Using inflation as a tool to avoid paying debts.
[27:39] Understanding the difference between real and nominal and price and value.
[33:49] Redistributing wealth through inflation.
[40:11] The three ways the government manipulates inflation statistics.
Mentioned in This Episode:
Thu, 16 May 2019
Jason Hartman talks with Josh and Mike from Elite Group Inspection Professionals about what to expect when getting a home inspection. A good home inspection can save you thousands, and a bad home inspection can cost you thousands. It can be tough to figure out who you can trust when you're getting one done, but Josh and Mike give you some resources to finding a competent inspector and what the major things you should be looking for on your inspection reports.
[6:49] Make sure you check your home inspector for licenses, certifications and insurance
[9:36] Some of the biggest concerns from buyers
[14:15] The pros and cons of various roof types
[19:09] Expect a lot detail about repairs needed in your inspection, but not about how much they will cost to fix
[22:43] What to look for on the interior of the house
[25:50] When you need to get a re-inspection done
[28:39] Some of the common plumbing problems
Wed, 15 May 2019
Jason Hartman and Drew do a small client case study about his journey of self-management, then move into the finale of Jason's examination of Kyle Bass' speech about China. Finally, Jason and Drew explain how Commandment #3 (Thou Shalt Maintain Control) and Tesla's current situation go together, as the company continues to make some poor business decisions and hemmorage money.
[2:50] Drew's new roof on his Indianapolis home
[9:54] When you self-manage, your tenant is part of your team
[13:59] Is self-managing really worth it to Drew or is he doing menial work that's not worth it?
[15:52] Revisiting Kyle Bass' speech
[23:06] How Commandment #3 and Tesla mix
[27:03] Tesla is getting dumb money and pillaging it
[30:29] In real estate you can fire someone and get another person to do the same job. With big companies like Tesla, you fire Elon Musk and the company's in trouble
Tue, 14 May 2019
1193: Client Case Study: David Nelson on Self-Management, Diversification & Listen Question on Loans After Fannie Mae & Freddie Mac
Jason Hartman and Adam start today's episode by answering a listener question from Amina, who wants to know what her options are after she maxes out her Fannie Mae and Freddie Mac loans. Surely there are options out there, but what are they?
Then Jason has a client case study with David Nelson, who, along with his wife, has amassed a real estate portfolio that has allowed her to retire early to focus on their holdings. David discusses how his cockiness led him into a bad deal, why continual education is important and where his journey is heading.
[5:15] Listener Question from Amina: what do you do after you max out your Fannie Mae/Freddie Mac loans?
[10:34] If you're wanting to cruise to Grand Cayman, Jamaica and Cuba you need to sign up soon!
David Nelson Client Case Study:
[17:19] David started getting cocky investing in 2016 and didn't pay enough attention to his inspection
[20:24] Jason's group doesn't do any one off deals
[24:28] How self-management has gone for David so far
[29:18] When you combine education with action you can accomplish nearly anything
[33:01] Why being 80% in on one asset class isn't necessarily a mistake
Mon, 13 May 2019
Jason Hartman and Adam use today's episode to discuss some important information about rental rates vs income growth, answer listener questions and what Mark Zuckerberg's college roommate thinks about him.
[3:29] Rents have been rising faster than incomes in most of the United States
[7:56] Investing in a prudent market with lots of government jobs could be helpful for rents not decreasing
[13:31] Would real estate investing make sense if another Depression hit the US?
[23:36] Population decline can be devastating for real estate investors
[29:06] Once big tech companies get their funding they start to lose their touch with the people
Fri, 10 May 2019
1191: Pension Ponzi Schemes, Asset Inflation, War On The Middle Class, Bernie Madoff, Market Cycles, American Greed with Pat Donohoe
Today's Flash Back Friday comes from Episode 872, originally published in August 2017.
Jason welcomes Patrick Donohoe of The Wealth Standard Podcast to discuss the dirty details of pensions, insurance policies and Ponzi schemes. Jason describes the difficulties and common mistakes average retail investors make when investing in financial services. And, Pat gives a comprehensive overview of how to make the most of your existing policies in order to invest your money in the most historically-proven asset class, income property.
[02:25] Is the US a giant Ponzi scheme?
[05:31] Understanding the difference between pension benefit plans and contribution plans is essential.
[15:15] The financial service industry preys on retail investors.
[20:49] Harry Markopolos is waiting to capitalize on a market correction.
[27:09] Analyzing the patterns and mistakes of the middle-class investor.
[35:27] The Wealth Standard Podcast focuses on helping individuals understand the comprehensive nature of the economy.
[37:49] Pat explains how policyholders can reduce their risk and get investment money for cash-flow properties.
Mentioned in This Episode:
Thu, 9 May 2019
Jason Hartman and Adam start off today's show talking about the topic of the news today: Trump's billion dollar "loss" over a 10 year period. What the media fails to mention throughout the whole thing is that he didn't actually LOSE any of that money, he simply had massive deductions thanks to the beauty of real estate phantom deductions.
Then Jason talks with Steve Jones, CEO of Allied Universal and author of the book No Off Season: The Constant Pursuit of More, about how his career in sports translated into business success. Steve and Jason look at the various skills learned in sports and how can each be applied to the business world, whether you're an employee or employer.
[2:55] People are horribly off target thinking Trump is a "Billion Dollar Loser"
[5:21] Real estate deductions run on a depreciation schedule
[9:37] Real estate offers you a tax deduction you can't get any other way
[11:44] How property tax states are able to increase their revenue through land value
Steve Jones Interview:
[18:16] Your ability to overcome obstacles is going to make or break your success
[21:05] Sports teaches you how to work as a team
[24:10] Some techniques on how to keep the team cohesive when dealing with adversity
[27:49] With no action steps in place you only have a dream, not a plan
Wed, 8 May 2019
1189: Artificially Low Interest Rates, the Next Recession & Investment Income From Tenants with Drew, Part 2
Jason Hartman wraps up his talk with Drew from yesterday, as the two leave the topic of self-management and delve into more economic lines of conversation. Jason brings up a recent Peter Schiff tweet and the two dissect whether it holds water in today's environment, as well as discussing how articially low interest rates are impacting the investing landscape we see today. They also discuss a different way to look at the rents you're collecting from your tenants in a way that makes it even more powerful than it looks at first glance.
[3:01] If falling consumer prices have been good for the last 100 years, why does the Fed think they're bad now?
[6:25] The artificially low interest rates are encouraging bad investments
[10:24] Who's going to get hit hardest in the next recession?
[14:10] Targeted advertising is keeping us from seeing a large chunk of the world today
[19:54] It's important to hold yourself accountable the same way you hold your tenants accountable when dealing with your investment properties
[23:57] Your tenants are working 33-40% of their work life just to pay you
Tue, 7 May 2019
1188: Client Case Study: Tenant Retention, Lease Renewals, Single Family Cost Segregations & Noise Pollution with Drew Baker, Part 1
Jason Hartman talks with client Drew Baker in part 1 of their interview about the new developments in Drew's journey in self-management. Drew gives Jason a rundown on how he deals with lease renewals, some of the repairs he's doing to his properties in order to retain his tenants, and what software he's using to keep track of it all. Jason also gives Drew a little bit of advice on how he may be able to accelerate his depreciation in a cost effective manner.
[5:15] The one type of pollution that China doesn't have, that America has PLENTY of, is noise pollution
[10:35] An update on Drew's self-management process
[13:38] Cost segregation studies have become reasonably priced for single-family homes and could well be worth the cost
[18:29] Drew tries to get his leases to come up for renewal in the warmer months, as well as signing a 2 year lease
[22:00] Drew's approach to lease renewals
Mon, 6 May 2019
Jason Hartman takes today's show to go over his thoughts on J. Kyle Bass's speech from the recent CPDC Conference about China. As the second largest economy in the world, China carries a lot of weight, claiming to have around 15% of the world's GDP. But a closer look at the numbers gives us a sense that it might not actually be true. There are dangers lurking in the China economy that could lead to some bad events.
Then Adam talks with Graham, one of the mortgage lenders with the network, about what interest rates investors can be expecting this month.
[3:13] China claims to have 15% of the world's GDP, but there's little to prove that's true
[5:49] Jason used to listen to the doomsayers, but it's not going to happen with such a demand for dollars
[9:47] Endowments don't invest in the greatest things, but it's not a problem that should be that difficult to solve
[16:12] The dangers present in China in their banking sector
[19:16] Hong Kong is the most expensive real estate in the world, at $10,000 per square foot
Adam's Mortgage Update:
[23:43] We're seeing investment mortgage rates in the low-mid 5s
[27:05] What will happen if the Fed decides to cut rates this year?
Fri, 3 May 2019
1186 FBF: Income Property Management, Tenant Self-Sufficiency & Tangible Assets with Scott Shellady, SVP of Derivatives for Trean Group
Today's Flash Back Friday comes from Episode 363, originally published in February 2014.
"The Cow Guy" Scott Shellady is the Senior Vice President of Derivatives at the Trean Group. He joins the show to discuss where people should start when investing in tangible assets.
Shellady believes in SWAGER for investing, standing for Silver, Wine, Art, Gold, Energy and Real Estate. He thinks SWAGER investments are a good choice for current investors.
The topic then shifts to how boomers can prepare for retirement. Shellady explains the most common mistakes baby boomers make with their finances and what they do if they were laid off or fired during the recession to protect their retirement.
Thu, 2 May 2019
Jason Hartman brings this episode to you from China, where he has seen the impact of the rising middle class. While it may seem to be a world away, the growth in construction in China is impacting the cost of construction here in the United States as well.
Then Jason talks with Anna Myers, Vice President of Grocapitus, about how to analyze deals, specifically for multifamily. Anna's group is all about finding the right deals in the right market, and she talks with Jason about which markets are looking good and which are past their peak, along with why the demographics for real estate investors is still incredibly bullish.
[3:28] The Chinese surveillance state is rampant and the country seems very wary of terrorism
[7:04] The rising middle class in China has led to a large amount of higher end stores
[10:31] All buildings are made from the same materials, so when there's a building boom in China it impacts builders everywhere
Anna Myers Interview:
[13:08] What is Anna's definition of "data driven real estate investing"?
[18:23] How can you know when the supply of starts is going to meet the demand for jobs?
[21:51] Things you need to be looking for at the neighborhood level of your market
[27:36] Anna's team is looking at approximately 80 markets a quarter
[31:28] What kind of properties does Anna have in her portfolio?
[33:47] The stigma of renting is gone as Millennials and Baby Boomers are now renting
Wed, 1 May 2019
1184: Client Case Study: SFRs to Apartments with Greg Scott & Population Density's Impact on Real Estate Prices
Jason Hartman begins today's episode from the city of Shanghai, one of the largest (and densest) cities in the world. Since he's been in town he's started thinking about the importance of population density on real estate. It impacts everything from quality of life to desirability of businesses to the pricing of every unit.
Then Jason talks with client Greg Scott about his journey from accidental landlord to an owner of multifamily properties. Greg and Jason examine why people don't know whether they're winning or losing, how Greg was able to continue investing through the Great Recession, and what sort of demographics are making being a landlord look better and better.
[3:46] It's important not to overlook the importance of population density
[6:27] One of the huge drivers of real estate prices is population density
[11:10] Even after "graduating" to bigger deals, Jason believes the single family home is the best deal out there
Greg Scott Interview:
[14:46] Greg's journey to becoming an accidental landlord
[18:23] People often don't know whether they're winning or losing
[23:29] When you hear about the returns people get from real estate and want to do the same, you have to actually act on it
[25:03] Greg's plan for his new multifamily facility
[27:49] How worried was Greg when he was investing in property during the Great Recession?
[31:55] Does Greg see the same thing about high rental demand as Jason does?