All Forum Posts by: Paul Moore

Hi @Marc Warren! You got a lot of great advice above. I recommend that you find a community of like minded investors and get advice from them. One group we recommend is Jim Pfeifer's Left Field Investors. Another one is @Ian Ippolito's Private Investor Club. You should get more than enough recommendations there. 

Though I wrote a book about multifamily investing in 2016 (The Perfect Investment) I have expanded to also invest in self storage, mobile home parks, RV parks and more. I recommend a diversified portfolio. 

Happy investing!

Hi @Kelvin Richards! That's a pretty broad question and it depends in part on your desire to be involved with your investments or to be passive. 

That aside, I'd recommend that you look for recession resistant asset types. Assets that usually do well in good times and bad. There are no recession proof asset types of course, but recession resistance is what I would go for. 

On a more granular level I would look for specific assets that have a lot of intrinsic value built in. Assets that can be modified (value-add for example) to produce more cashflow, more value, and create outsized appreciation. Feel free to reach out if I can help. Happy investing!

Hi @Chris Hill! Congratulations on your success so far. You are in an enviable position and have done better than 99.x percent of the population. 

You can clearly do the math and you got some great advice above. I'm going to answer from a different angle. I am going to ask if you really want to manage condos and other properties on your own as you enter your 50s, 60s and beyond. There is absolutely nothing wrong with managing these properties but as you know, the hassle factor can be significant. Maybe it isn't for you but I find the vast majority of real estate investors I speak with find there is a bigger hassle to expect when managing properties. If that's what you want to do it seems like you are on a great path. 

On the other hand if you, like me, and many other investors I know want to get rid of the hassle and some of the specific risks of owning and managing properties yourself, the syndication route is the obvious way to go. 

I know I am significantly oversimplifying this but I am just throwing this out there for readers to remember the hassle factor and how it should be figured into your decision. Good luck and happy investing! 

Hi @Karna Patel! Congratulations! Most people start out in residential real estate and many of them eventually "graduate" to commercial real estate. You are very wise to start off in commercial real estate from the beginning. 

A lot of the answer will depend on what kind of company you will be working for and what you are passionate about. It's likely you will learn a lot of things on BiggerPockets and from books and podcasts that you might not hear at work. You got a lot of great advice above. Feel free to DM me to jump on a call to discuss this further. 

Hi @Randy Smith! This is a wonderful post IMHO and I'm really surprised no one has commented on it. 

I completely agree. I've been a full time investor since I sold my company in the late 90s. Well, I actually I was a speculator for a long time and after losing money I am champion for investing versus speculating. I believe that investing is when your principal is generally on the safe side when you have a chance to make a return, while speculating is when your principal is not at all safe and you have a chance to make a return. I digress. 

I have migrated from investing in lots of things to mostly real estate over 20 years ago. I've migrated from residential real estate to all commercial real estate in the past decade. The goal of our fund is to do exactly what you said which is to provide diversification across recession resistant asset types as well as geographies, operators, etc. I really like your post and just wanted to thank you for it! 

Hi @Gavin Beard! It sounds like you're off to a great start and BiggerPockets is a great place to start to get advice. 

I recommend that you go to some commercial real estate courses or events to learn more before making a decision. If you decide to skip college you will need this type of training to manage your own firm. If you decide to go to college it will give you some more guidance and focus your efforts there. 

I have an engineering degree and an MBA but the vast majority of what I do I did not learn in college. I am not saying you shouldn't go, it is really up to you. But a lot of very successful commercial real estate investors have went a different route or after going to college have switched careers. You're in a great position and as @Eliott Elias said above you have some time to make decisions. I wish I was asking that same question as your age. 

Hi @John McKee! Great question. My firm manages a commercial real estate fund. We invest with the best operators we can find in various recession resistant asset classes. As a result, I can only answer best from my point of view. 

I've learned that when a market gets shaky and interest rates rise like they have that I need to do a better job than ever communicating with investors. It's not enough to continue to tell them what we're doing and about our successes and challenges. Investors, not surprisingly, want to know details about how we are dealing with the current interest rate increases, movements in cap rates, and more. 

A lot of investors want predictions on the market and we've all found that's impossible to do well. Check out this graphic showing past predictions of forward looking interest rates. This is from an expert who spends a lot of time evaluating the market. If they can't predict the future then it is a fool's errand for us to try to. 

@Bob Stevens thank you for your replies on this thread. I'm a little confused on your answers so I wonder if you could demonstrate how you're getting a 20% or better cap rate. Can you give us an example? You also mentioned net versus gross cap rate and I wonder if you can explain that a little more. I look forward to hearing back! 

Hi @Eric Fernwood! Great post here and a lot of healthy discussion. 

You asked in your original headline "...how to stop it?" 

I'm going to come at this from an entirely different angle. I just spent hours with friends who have been trying to manage single family rentals. For most people it's far more challenging to manage single family rentals than they expect. It's usually not like it is on HGTV though I admit it works out for some people. 

Again to your original question, I would say most investors would be most profitable, most safe, and most happy by investing passively in commercial real estate syndications or funds. The goals are principal protection, cashflow and growth are often achieved. The operators are taking the debt in their name, finding the deals (typically off market) and they are rolling with the punches of economic cycles nationally and locally. 

Though it's easy to make a mistake in this arena as well, most investors who have a job, a life and a retirement might be happier and better off investing passively. Just my two cents! 

Hi @Cooper Heller! You're in the right place to learn a lot about real estate investing. I highly recommend you listen to a couple hundred episodes of the BiggerPockets podcast. I am guessing something will strike you deeply inside and you will know that is the path to pursue. That said here are a few thoughts: 

First, someone mentioned house hacking. I highly recommend you house hack with a single family, duplex, triplex or fourplex. You should be able to get Fannie Mae or Feddie Mac debt and that will help. Even better if you are a veteran. BiggerPockets has a great podcast on house hacking. 

That said, if I was starting over in real estate investing I would jump into commercial real estate as soon as I can. That could include large multifamily, self storage, mobile home parks. RV parks or more. So many things to choose. I wish you the very best of luck and success!