All Forum Posts by: Ari Hadar

@Ari Hadar generally, I think referrals from others that you trust. I personally like the model of sharing deals with a mentor because it aligns your interests. Rather than simply paying for education, you both win together, so the mentor is motivated to help you get to the finish line.

Hi @Ari Hadar, I think the terms Coach and Mentor are often used interchangeably. I have paid for directly for some mentors, and others have mentored me while sharing deals. Some have been compensated for their time by me using their other services like contracting or lending. A good coach / mentor is always worth paying for, and if they aren't being compensated for their time in some way, they either don't realize their own value, or they aren't going to be motivated to continue to stick around very long.

I would absolutely NOT hire a mentor. For me, it's a mindset thing. Everything you need to know for the basics of building a buy and hold portfolio are in free reasources like biggerpokcets that can be easily accessed. Even some ebooks you can find for free or like $2 online. If you expect a mentor to hold your hand and make sure that nothing bad happens, you're going to be in for a rude awakening. Just because there's plenty of free resources out there doesn't mean you're expected to know everything. Thats part of what building a team is for. Start off with a well trusted agent in your area that works with investors, attend meetups and I promise your team will form themself. Once you show that you have done the leg work in educating yourself, if you have a specific question on an issue, you will find plenty of investors that are happy to answer a question or provide a referral.

I love working with an investor.  That said, I'm an investor myself.  I think it is a great match if the agent can CALCULATE cap rates, LISTEN to what's important to the investor, and UNDERSTAND the clients long term or exit strategies.  As investors, we all have different skillsets, risk tolerances and capital.  So I think it is extremely important as an agent and investor to sit down and discuss the potential relationship and hit on all those things and the expectations that go along with that.  I love working with investors, especially those just getting into it with the goal of building long term wealth. There is so much more value I receive when I can help a fellow investor get launched and see them succeed and start stacking up more properties and trying different strategies along the way.  Being trusted to come alongside them as an educator is much more fulfilling to me than the sale.  Some agents just don't understand that, or don't yet.  So if that's the case, you move on and try to find one that knows what they're talking about and asks the right questions.  If you're in an area where you're not having any luck finding an agent, feel free to reach out to me and I can network through my channels with the goal of finding you one that will exceed your expectations.  Great post, thanks for sharing!

I wanted to ask fellow foreign investors what there biggest fear or challenge is trying to get into the property market in USA.

@Jason Papp it took me a second to figure out your question, but yes.

You would be selling the home for $425K.  In 20 years the seller will have been paid over $100K.  So yes, but here are some issues.

The first lender (if traditional) may not allow a 2nd on the property.  What stops you from paying off the 2nd loan the next day and saving over $75K?  Without a hefty pre-payment penalty the seller has no guarantees you won't?

Good Investing...

@Bakir Ebrahim The "Special Sauce" for Real Estate Investing is the leverage of capital, remove that factor and returns significantly underperform in comparison to other investing potentials. This is not a negative reflection of real estate as an investment vehicle, it speaks to to negative impact of improper utilization. 

Let's do the #'s on your question: Let's say it's utopia-ville where all properties are always $100k, tenants always pay $1k, and everything is always perfect and right, to keep it simple math. 

You have $100K, how does it best deploy;

Free and clear purchase. $100k, receiving $12k per year. Your rate of return is 12% annual. 

---- OR ----

25% down payment ($25k) = 4 properties ($400k in RE controlled) and with that $48k gross rents annually MINUS $300k mortgage payments of $17,000 annually = $31k annually. Your rate of return is 31% 

NOW lets say in Utopia-vill annual appreciation rates are a static 4%. See, the equitable gains are where the power of OPM (other peoples money) significantly amplify the power of leverage. 

The 1 property free and clear, after 10 years, has a market value of $148k, a $48k profit. 

Using leverage, having controlled 4 properties, after 10 years you have profited $192k in just equitable gains. OR in time terms 30 additional years of equitable gains. 

The truth is leveraged money is actually leveraging TIME. In any & every case that a person presents an all cash investing strategy, the use of leveraged funds will get a person the same results in a fraction of the time. The true sacrifice of all cash is time, becoming financially free at 40 or 140. 

Leverage can help but 40 % down ang 6%interest for foreigners reduce the profitability significantly. 

Yes. I think your individual goals will really lead to which tactics will work best for you. Many strategies can be made successful, and many tactics within those strategies. But there is no silver bullet, or one-size-fits-all technique. That's what most are hoping for when they first learn about real estate investing, but there are so many ways to make (and lose!) money in real estate. I'm one who believes a mentor is the way to go. I made my most expensive mistakes between mentors, and won't make the mistake of being without them again!

The most valuable personal component of my own real estate investing is the ability to self-start, to be self-motivated, to find and read and listen to stuff by myself, to reach for solutions by myself, to adopt someone else's best practice based on my own personal judgment, to always, always, always be up and after what I need to do.

The biggest reason I see others holding back is a fundamental unwillingness to do their best and yet fall flat on their faces and fail. Fail publicly, humiliatingly, over and over and over again in front of their friends and family. Fail so many times and in so many ways that failure is as close to them as or closer than their brother.

The immense majority of the people I meet cannot look a stranger in a suit in the face and say, with zero hesitation and good humor, "Oh yes, I am a failure in life. A complete failure. A miserable failure. A nothing. A zero. A nobody beyond redemption. And just who the hell are you, Jack?"

I know it sounds trite, but Michael Jordan really did say it best: "I can accept failure. I can't accept not trying."

As I see things, the world is jam-packed with not-tryers. Absolutely overwhelmed with them. They'll start tomorrow. They need some time. They'll think it over and get back to you. They want to revisit this over coffee and a sammich sometime next month.

And so, my best advice is not to go looking for a coach to turn you into an eagle from a s***bird.

I see a lot of those types reaching for a coach as a crutch and lying to themselves about it. They do it so they'll be able to blame her or him when they screw up. Or at least share some of the blame. Anything to avoid being humiliated, to know in their bones they've failed and they're a failure, to have the closest people to them know it too.

You need to understand coaching as a form of education, strip away the glib mysticism that so many charlatans sell. Someone who comes to you one day and tells you that he's going to change your life forever in a million ways and introduce you to an elite group of his associates and disciples isn't a coach. He's either a charlatan or Jesus Christ, and there was only one Jesus Christ. It also bears remembering that Jesus Christ didn't wear a bright blue suit and put goop in his hair.

On the other hand, the guy who specifically explains that he knows three different kinds of deals he can teach you, four different kinds of flip, two styles of buying and holding, that he can introduce you to (insert name) to (insert reason) and (insert name) to (insert reason), THAT'S who you want to listen to. No Jesus, no drama, facts, known associates, reproducible results, concrete reachable goals.

While you'll go in as a s***bird and come out as a s***bird, at least you'll have some money in your pocket and knowledge in your head. And just in case you were unaware, eagles have a cloaca, too.

Unless you live in a market where your average home is $1M and you have a reliable high W2 income and are able to build a portfolio of not less than 8-10 SFR you have no business doing OOS investing. Otherwise start local. If you have a small amount to invest you are better of buying and index fund and adding to it gradually.