All Forum Posts by: Jesse Houser

@Jeremy Karja I believe you would need to have a survey done. As an agent, I would try and put that cost on the seller and use the survey to determine whose driveway the property is on. You will also want to check into how long they’ve been using the driveway as there could be an issue of adverse possession (just google adverse possession if you’re not familiar with the term). Finally, I’d also suggest checking to see if there are any easements for the neighbor to use the driveway. I don’t know the layout of the property you’re referencing so an easement may clearly not be the issue, but would probably be best to check.

@Andrew Neal, I agree. The ability to leverage your property and turn that into more returns is the key to building wealth in real estate. Thanks for sharing the example of your home. We're in the same boat with our house. Currently finishing renovations and will be able to list for $50k more than we paid and will probably be netting $35k all without being hit with capital gains taxes. Putting money in a savings account in a bank is about as useful as burying it in the ground. With inflation, it's just losing more and more value over time. And the piddly of interest banks give you anymore is a complete joke.

@Todd Dexheimer, I like that you mention the creativity that comes with real estate. There are so many different avenues you can take to not only invest in real estate but also with a property you own (rent it, 1031 exchange, lease option, seller finance, etc.). In a way, I feel like there is more protection in holding property just because there are so many different exit strategies I can take. And that's not even taking into account all the advantages you and the other posters have shared. Like your final point says, it's one of the safest investment you can make, especially if you know what you're doing and educate yourself.

@David Stewart Sounds like you know what I'm going through. I think the biggest thing is not taking the easy way out. Real estate takes work and I would argue is way more difficult than just putting money into your retirement and trusting that it's going to be invested wisely. I honestly think that's one of the largest hurdles some people have. They don't know enough about investing in real estate (other than the horror stories of calls at 2 AM) and at the moment feels less painful to just dump money into a retirement account. If there's one thing I know, I want to be in charge of my financial future because I know I'm going to look out for my best interest. No one else is going to have the same care for it that I have. 

@William Jenkins, I don't necessarily feel that it's a bad thing to have some diversity between real estate and the stock market. My concern comes from what is the better option and why do people choose one over the other. You can build wealth and make loads of money in the market, but I think the lack of control is the most challenging aspect for me. And honestly, the theoretical pay off of a $5k invest in 1960 does none of us any good right now. You're going to be hard pressed to find anyone who can make that same type of investment today and get similar returns. Sure, maybe Buffet, Bogle, or any of the other guys who just seems like freaks when it comes to making investments. I would argue that the market is way more volatile now than it ever has been just due to the nature of the world we live in. I feel like it's almost impossible to invest into anything with much certainty.

The one thing I will say about investing in the market is that I particularly like the All Weather approach by Ray Dalio. The approach that he takes to investing has produced positive returns or broke even all but three years since the 1960s. If you haven't heard of it, I would recommend checking into it. And I would also highly recommended Tony Robbin's book Money Master the Game. He actually sat down with some of the iconic investors I mentioned above and discussed their approach to investing. Ray Dalio lays out a simple and easy to understand version of his All Weather approach for today's market. It's a huge book and a long read, but so much valuable information within. 

@Jack B. You're correct, being a landlord does have considerably more responsibility to it than just dumping money into a 401k and letting it grow. However, there are many other ways to get involved in real estate that don't necessarily require you to be a landlord (syndication/crowdfunding, notes, having a property management company handle the care of the property). There is still work involved with each of these, mostly keeping an eye on your investment or the company managing it. But I would argue that the same care should be taken with investments that don't include real estate. 

@Ana Garcia Thanks for spelling all of those benefits out. It's helpful seeing them listed out like that because although I know of them and know them as a benefit, it's easy to forget some of them when trying to explain the benefits to another person. I honestly cannot disagree with anything that you said. Really good post!

@Scott W. While I agree with you that some tax benefits come with a 401k and IRAs, I'm not sure it's the best option unless you go with a Roth. If you have company matching it's an entirely different story as you want to take advantage of the matching. I have a hard time imagining that taxes are going to be lower when I decide to retire vs. where they are now (granted I have a while to go before I'm retiring from a 9-5 job). I think I would prefer to pay the tax now rather than later. But again, I'm don't think it matches the tax benefits you can get from owning real estate (namely rental properties). You also mentioned the higher returns that stocks have had over the returns on real estate. You can't argue with the numbers, but I think it also has to be considered how much more volatile stocks can be. Of course, with risk comes reward, but if I'm trying to build long-term wealth for the future, I can't play super risky. A large part of this for me is the lack of control. Something I have almost no control over feels way more risky to me than owning rental properties, and I use what happened to Facebook in the past would weeks as the example. Because of poor decisions within their company, their stock plummeted, and there wasn't a single thing their investors could do about other than get out while they still could. 

@Tony Kim Thanks for sharing the article. Was a pretty interesting read. I agree with you about the savvy investor being able to average much better returns.

I'm not able to look up the stats right now, but I think the majority of the wealthiest people in the world own real estate and have made a large portion of their money in this field (I think I read this in Tony Robbins book Money Master the Game). Maybe worth looking that information up again.

Thanks for all the responses, guys!

@Jim Grutkowski I agree with you that it doesn't necessarily have to be one or the other. There is definitely a benefit to diversifying your portfolio, having high risk/high yield and low risk/low yield investments, and then diversifying within asset classes as you said. I'm personally not convinced that some of those types of investments are worth it, but each person will have their perspective.

@Steve Vaughan All the points you mentioned are what I feel most strongly about as well. Leverage and taxes are two enormous benefits to growing a strong portfolio and doing it without needing to have all/sometimes any of the money up front and also keeping my money in my pocket. But I think what you said about control is the most important thing to me as well. I don't have any influence on what happens at any of the companies involved in a mutual fund and as @Mike M. has shown below, look at what just happened to Facebook just a few weeks ago. And that wasn't even in a period of recession, just poor choices on their part that cost a large number of people millions of dollars. 

I also like that you mentioned the fees that come with annuities. There are also a ridiculous amount of fees that come with trading stocks, and unless you're somewhat informed about it and keep an eye on the fees that you're charged, someone else can walk away with a large chunk of your profit. 

Thanks again for the input everyone and please keep it coming. I'm interested in hearing any other information you may have!

Hi all!

So I've been talking with my wife about the benefits to real estate investing vs. other forms of investing (stocks, bonds, annuities, etc.). She leans very much towards those forms of investing because it is what her parents have done and so it's what she knows. I've been trying to explain to her why I feel real estate has more benefits than the stock market and I was wondering if any of you could help me out.

Why do you pick real estate over other forms of investing? How can I better explain why real estate is a better vehicle for building wealth over stocks, bonds, annuities, etc.

Thanks for the help!

Hey all, I'm also in the Mansfield area. The next REIA meeting will be at the Holiday Inn on Park Ave (info below). It runs the fourth Tuesday of every month and is an excellent chance to network with other investors. Assuming the schedule holds, we'll have some people from Section 8 Housing coming to share about the program and provide us with some time to ask questions. Should be a good time. Hope to see some of you there.

116 Park Ave W

Mansfield, OH

4/24/28 @ 6:00 PM

Yeah, I feel the same @Mike McCarthy. A lot of the podcasts have talked about in terms of adding additional units to a property. Another one involved a guy from Detroit who took out a single family property, split the acre of land up into multiple lots, and then put multifamily properties on the land. And his explanation was that he was able to do all of that because he understood the zoning laws for his area. I think it's a really interesting way to make sure you get everything out of a property, as well as another way that a property may make sense to purchase. 

Hey everyone,

So I've been listening to a lot of the podcasts here lately, and quite a few of the guests have talked about zoning laws. Many of them shared how they were able to greatly increase the values of the properties they were purchasing due to the knowledge they had about zoning laws in their area. While I've found a couple different ways to learn about the laws in my area, I was wondering what strategies other members of BP have used to educate themselves on zoning laws in their area. Also, would learning about these laws be beneficial for business, or should I spend my time elsewhere? If anyone has a success story on how learning about zoning laws benefited their business, I would be interested in hearing it.

Thanks all.

Jesse

What you posted Greg is basically everything I've found online. Drops slowly, 60-90 days depending on they state, and will pay none of your fees or closing costs. Thanks for the response guys. I'll keep looking into it but looks like I'll have to wait a while or let it go.