BP Podcast 274: 3 Rules Paul Morris Uses to Never Lose Money

[Mindy Jensen]

What rules govern your real estate investing strategy? For most, it’s a tough question to answer. But not for today’s guest, Paul Morris. Paul, co-author of the bestselling , has been investing in real estate for more than twenty years and has never lost money, all because he abides by three simple rules. Today, Paul also discusses the power of mindset in building wealth, the key to investing in emerging markets, and much more. This episode will surely inspire, motivate, and educate you to continue your journey toward financial freedom.

[William B.]

Mindy, I am not sure I have something to say relevant to your post as it should be however, I just watched https://www.biggerpockets.com/show274 and I am enamored, dazed, fascinated, and inspired by one thing Paul Morris said which essentially is: "Hard work is something you don't enjoy doing" - Paul Morris; How is it that I haven't come to this realization until now and Paul Morris said it in such a concise and eloquent fashion? Am I being hyperbolic or does this resonate with any of you too?

[Sylvia Grugett]

I also came to a realization of that very thing that Paul said. He hit it on the nail! I honestly haven’t listened to many of podcasts recently but something drew me to this one and I ended up listening to it multiple times because everything Paul said was so simple and profound. Best one yet BP!

[Jay Hinrichs]

bounced around this one.. biggest take away FIRST property HOUSE HACK 

[William B.]

Originally posted by @Jay Hinrichs:

bounced around this one.. biggest take away FIRST property HOUSE HACK 

 Jay you gotta watch the 40:00 to 55:00 portion at least, 40:00 and on was the better part but honestly it was all pretty darn good. Of course you are a seasoned fella so it may not resonate with you as much.

[Jay Hinrichs]

I think I did were he talks about doing stuff he does not like..  or something to that effect.. I do that everyday.. real estate is not perfect and there are things we don't like.

of course I am just a little guy working from my home.. but I used the same method in the day.

I always owned a brokerage and had 40 to 50 agents working for me.. and that's where I picked of some great deals.. and its why I never really worked with the wholesaler crews  did not need them.

or I beat the wholesaler to the deal.. never bought from them.

I did not see how he made it through 08 to 2011 and never lost any money.. the value of his assets had to fall so I guess if you dont' sell you don't lose money.. so that was a good thing for him.. Very few can make that statement that were fully engaged in Real estate . and it could be he was more start up phase at that point in time too..  But any way.. I totally agree with him.. before you run off to some far away place you as a buyer in a high priced market should do whatever it takes to house hack and get a west coast asset especially CA if your going to live and work there.. its the foundation to manys long term wealth plans.. there are excepetions to that.. but very few

[JD Martin]

My takeaway from this: buying what & where you know. I don't own a tenth of the units he owns (although I own just about all of mine completely, f&c), but I truly feel the reason I've done well is by sticking to his 3 rules, which I've never really thought of as rules as much as it's just what I've done - buy where I know, be sure it cash flows, buy value add. That describes pretty much all of my properties. 

[Erwin Groenendijk]

Again, a really exciting/stimulating podcast. Shared it with my community of investors in Europe!

[William B.]

Originally posted by @JD Martin:

My takeaway from this: buying what & where you know. I don't own a tenth of the units he owns (although I own just about all of mine completely, f&c), but I truly feel the reason I've done well is by sticking to his 3 rules, which I've never really thought of as rules as much as it's just what I've done - buy where I know, be sure it cash flows, buy value add. That describes pretty much all of my properties. 

 Owning free and clear is a cut above, an extremely conservative approach (which I love and aspire to do), I would love to have the cash to do so right now, for now it will have to remain a part of my long term strategy. Great job with your investments and leveraging conservatively to solidify your portfolio resilience. It will be a huge asset to sleep soundly when values drop again at some point and not have to worry about being over leveraged. 

[Joseph M.]

Great podcast . Since Paul is also in the L.A , I found it insightful to hear about how he is investing locally in the current SoCal market .

Los Angeles has rent control but he says he still purchases properties that have rent control tenants and mentioned being able to buy out tenants etc .
Would definitely be interesting to hear more about that.

Paul is also the second largest franchise of Keller Willams offices ( outside of Texas where they started ) which is super impressive too of course .

[Russell Brazil]

I dont know how many times Jay and myself warn people about out of state investing in these forums.  Was great to hear someone else on the podcast talk about buying where you are and what you know.  Too many get drawn to these out of the area turnkey guys selling stuff in warzones and then wonder why they lost a bunch of money.  

[Mike Taravella]

The discussions regarding mindset was absolutely amazing. I always feel frustrated if I am not working super late on my real estate goals of trying to get my first multifamily property. With this episode I realized I need to have systems in place to help get to my goal with ease. Thanks BP nation for continuing to help everyday!

[Dennis M. Williams]

Yet another awesome podcast! Thank you for your time sir, and your insight on the mindset needed in this game.

[Keith C.]

IMO Paul was one of the best guests ever on BP. Great motivators / speakers / authors provide Takeaways  by using basic numbers to drive points home. Anyone who's show starts a show  with  " 3 Rules...  "  You know will leave  you with at-least 3 memorable points. Paul provided much more than that from great RE / business tips to mindfulness exercises  . I'd love to take Paul up on his mentoring offer.  Coffee on me.. 

[Fernando E.]

This episode with Paul is amazing, I love the 3 rules:

1. Buy what and where you know
2. Buy only cash flowing asset
3. Always buy value add ie worst house in the best neighborhood

But what I love more are the mindset advice shared by Paul including

1. Change “goals” to “commitment” and add “with ease” for example what do I need to do or be different in order to make $10,000,000 with ease?

2. Your net-worth will never exceed your self worth

3. Change your outside environment as we know we are the average of our 5 people we hang out with the most

4. People overestimate how they can change others and underestimate how they can change themselves and the last one

5. Most powerful words are those after “I am” .. like I am a smart and network very well adding a lot of value to people around me making me successful real estate investor

Great episode guys!