David Pere

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David Pere has been active in the U.S. Marine Corps since 2008. He got his start as a real estate investor in 2015 and since then has bought and sold over 50 rental units, partnered on multiple fix...
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David Pere has been active in the U.S. Marine Corps since 2008. He got his start as a real estate investor in 2015 and since then has bought and sold over 50 rental units, partnered on multiple fix-and-flips, and built a growing community of like-minded investors. Through these experiences, From Military to Millionaire was born with the goal of teaching personal finance and real estate investing to service members and the working class. David is the host of The Military Millionaire Podcast and has created a YouTube Channel where he shares the knowledge that helped turn his life around. In four years, David has gone from living paycheck-to-paycheck to replacing almost half of his income. He aspires to help others follow in his journey to financial freedom!
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Personal Development

The Least Discussed Reason Wannabe Investors Don’t Take Action (& How to Overcome It!)

I’ve never fully understood the obsession with figuring out why other people fail to take action when it comes to real estate investing. It seems like a lot of people genuinely look for justification not to start.  “If Jimmy didn’t start because he had no money, and I have no money, then I’m justified in not starting yet.” This is entirely the wrong mentality! Why not focus your energy on figuring out why successful people DID take action? Regardless, I’m going to tell you the real reason some who are interested in investing never take action. It’s something that isn’t discussed very often. But first, here are some of the most stereotypical excuses. Why Some Wannabes Never Take Action: The Typical Responses Don’t get me wrong. All of these excuses are pretty understandable—yet unfortunate. Let’s briefly discuss each. Fear Fear is a beast. And taking the plunge into real estate isn’t easy.  That being said, everybody experienced the feeling of fear when they bought their first property. It may not have been crippling, but it was there. Anyone who tells you they weren’t at least a little scared is probably not being completely honest with you. This is why it’s important to make decisions based on numbers and bounce the analysis off experienced investors. Don’t bring your emotions into the deal at all. Emotions are dangerous—leave them out of investing. Lack of Experience This excuse drives me nuts! NOBODY had experience before they took action—you gain experience BY taking action! If this is your excuse, either quit or work under somebody for free to gain the experience you so crave. This is a silly excuse to me. Just take action! Related: A Beginner’s Guide to Finding a Real Estate Mentor No Money This is an understandable excuse and probably the most common. I have been investing since 2015. To date, I have never paid more than 6 percent down on a real estate transaction. Leverage is wonderful. It is risky but wonderful. I house hacked my first duplex for less money than most of my cars have cost.  Theoretically, you could sell your car and buy a house.  You can overcome the “no money” issue by utilizing FHA loans, VA loans (if qualified), seller financing, purchasing subject to the existing mortgage, partnering, other people’s money, hard money lenders, etc. My point is this: While having no money is scary, if you have knowledge and time, you can invest in real estate! Not Enough Time YOU HAVE THE SAME AMOUNT OF TIME AS EVERYONE ELSE! Set your priorities, and either make REI a priority or find someone with time and provide money/knowledge! This is a cop-out excuse.  I purchased a property while spending six weeks on a remote island and only having access to the internet through my cell phone a couple of times.  Figure it out. Why Some Wannabes Never Take Action: The Least Discussed Reason We have ruled out the most common excuses. And yes, they are just excuses. Now let’s talk about the least discussed reason some wannabes fail to take action (and how to avoid it). You’re LAZY! That’s it. The number one reason some people fail to take action is the amount of work required. This excuse is behind the time, fear, and experience excuses. You know it’s going to take a lot of time and energy to make this happen. You’re afraid because it takes a lot of work, and you don’t fully understand what to expect. You don’t have experience because you haven’t done it yet. In the military, there is a common phrase we use in combat: “Complacency kills.”  Although the meaning is a little different when applied to real estate, the message is the same. It’s not the one morning you sleep in or the one day you get nothing done that hurts you. It’s not the hassle you avoided today or the excuse you used today in order to procrastinate. However, if you ALWAYS avoid hassle, procrastinate, and sleep in, you will never succeed. Sloth is one of the seven deadly sins. If you want to succeed as a real estate investor, or in life in general, you need to kill the urge to be complacent—before it kills you! Related: Getting Started In Any New Real Estate Business Start Investing NOW: Here’s How Goals The first step to conquering the excuse of laziness is to sit down and set goals.  You need to long-, medium-, and short-term goals. These goals should be similar to a five-year plan, yearly goals, monthly goals, and weekly goals.  Think of the cartoons you watched as a kid where a rider would tie a carrot to the end of a long pole and dangle it in front of a stubborn horse/mule in order to motivate them to move forward. Goals are the carrot you dangle in front of yourself. No matter how driven you are (or aren’t), there will be days when you lack the motivation to do any work. At these times, it is important to have a carrot (goals) to chase in order to stay on track! M.I.N.S. Some of you may have noticed I didn’t say you need daily goals. You may have even been bothered by this and decided to tune out (haha).  The reason I didn’t mention daily goals is that, while they serve a purpose, I prefer to think in terms of the “most important next step.” This is sometimes called M.I.N.S. M.I.N.S. should be determined every night before you go to sleep. This will ensure you knock out the most important next step toward your weekly goal(s) first thing the next morning. If you can knock out the most important next step toward your goal every morning, it will snowball into accomplishing your goals quickly! The key is determining what this step is the night prior, and then doing it first thing the next morning! Accountability Most of the actions you take to achieve your goals will not be fun or easy. It’s easy to find “busy work” to use as a distraction. This busy work is more fun and often easier than accomplishing the most important next step would be. Since we are all human (I think), it’s safe to assume that you will have days, weeks, months, or even years when you fail to do the difficult task(s) that need to get done. This is human nature and a hard habit to break. And this is why accountability is crucial to your success as an investor.  You need to find some people who are on the same path as you, as well as a few who are farther down that path, and get together to grow and hold each other accountable! A common way to do this is through mastermind groups. A mastermind group is comprised of people who have lofty goals for life and are determined to achieve these goals. They meet regularly, whether in person or on conference calls, and talk through their struggles, successes, and so on in order to help each other progress. These mastermind groups are great for helping you grow and holding you accountable to achieve more! Systems Real estate investing isn’t easy at first (most things aren’t). Imagine REI as a large flywheel, and every step you take gets it to move just a little bit faster. As the flywheel speeds up, it takes less and less effort to keep it moving. This is the power of systems! Every time you complete a task, remember how you did it. If you complete that task a second time, create a system for streamlining the process. The simpler you can make tasks in real estate, the easier it becomes to buy homes! For example, one of my favorite systems to date is my Google Drive folder for lenders. Every time I have applied for a loan, I needed to provide the previous two years’ tax returns, W-2s, bank statements, photo IDs, verifiable income, etc. I created a folder titled “Lender Documents” in Google Drive that has all of this information in it, separated by tax year. Now, when I apply for a loan, I simply email a link to this folder to my lender and wait for them to tell me if they need any more documentation (which is minimal, if any)! Talk about streamlining the lending process. Don’t forget to create systems as you journey down the path of real estate investing. It will make your life so much easier! Use Laziness to Your Advantage Lazy people will often find the easiest way to accomplish a task. Use this mentality to succeed as a real estate investor—without losing all of your hair. Real estate investing isn’t easy, but it is extremely rewarding. Embrace your laziness, and use the safeguards above to continually attack your goals. Take the time to put in a lot of work now. You will be happy that you did! Have you stutter-stepped instead of starting? What’s holding you back? How will you overcome it? Leave a comment below!   Free eBook from BiggerPockets! Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks, and techniques delivered straight to your inbox twice weekly! Actionable Advice for Getting Started, Discover the 10 Most Lucrative Real Estate Niches, Learn how to get started with or without money, Explore Real-Life Strategies for Building Wealth, And a LOT more Sign up below to download the eBook for FREE today! Click Here to Download the eBook Now! We hate spam just as much as you

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Personal Development

The 13 Best Real Estate & Personal Finance Podcasts Right Now

I love listening to podcasts! A podcast is the most direct way to learn from experts in any given field. Think about it—many podcasts, particularly those related to real estate or personal finances, are structured like this: for 30 to 90 minutes, a guest takes you through their journey to become the successful person they are today. They talk about failures and how they dealt with challenges. They talk about current struggles and what they’re doing to overcome them. They talk about what worked and what didn’t work for them along the journey. By listening to podcasts, you can avoid many costly mistakes and streamline your own journey to success. And the best part is you can listen to them anywhere—in the shower, car (my favorite while commuting), walking down the street, cooking in the kitchen…literally anywhere! But there are so many great real estate investing and/or personal finance podcasts out there. Where should you begin? Here I’ll break down some of my favorites for you! Related: How I’ve Made Over a Million Dollars Listening to Real Estate Podcasts Real Estate Podcasts Real estate investing is a great way to build wealth, but without a guide, it can be complex. Want to become the next Manny Khoshbin, Grant Cardone, or Donald Trump? You need to listen to these real estate podcasts as frequently as possible! The BiggerPockets Podcast – Brandon Turner and David Greene (and Josh Dorkin for the first ~250 episodes) With over 50,000,000 downloads, the BiggerPockets Podcast is the most successful real estate podcast in the world. I attribute much of my own success as a real estate investor to this very podcast. When I first became interested in real estate, I started listening to an episode every day on my commute. Since then, I’ve listened to almost all of the episodes that have been released! My favorite episode was No. 281 (because I was a guest). Joking, of course.  I can’t pick a favorite episode, because every week they come out with a new one that is just as amazing as the last. If you like real estate investing—in any capacity—this podcast is for you! Best Real Estate Investing Advice Ever – Joe Fairless Joe is an absolute beast. The Best Ever podcast (shorthanded) produces a new episode daily and currently has 1,740 episodes released. (I can’t imagine recording that many podcasts!) I like this show because there is ALWAYS a new episode to listen to. With nearly 2,000 produced, Joe most likely has covered any real estate topic you’re curious about. Millennial Real Estate Investor Podcast – Ben Welch and Dan Mackin I had the opportunity to appear as a guest on this show (episode No. 35), too, and really enjoyed the hosts. I prefer shows with two knowledgeable hosts. It makes the flow of conversation better and allows for even better questions to be asked. That means better content for the listener! Like the name implies, this podcast is geared toward millennials. So if you’re a young real estate investor, this podcast is for you. The Military Millionaire Podcast – David Pere The Military Millionaire is a real estate podcast specifically geared toward service members and the working class. It features many guests who are military real estate investors, including several who transitioned from active duty to civilian through real estate. Yes, this means it discusses VA loan investment strategies, as well. There are also several very successful real estate investors who got started in the working class. The goal of this podcast is to show that with education (not formal), creativity, and grit, you can build wealth through real estate investing! You don’t have to start with a huge income or inheritance. If you are in the military, this podcast is for you. The Investor Mindset Podcast – Steven Pesavento This is a newer podcast, with only 16 episodes at the time of writing. However, they have already reached 20,000 downloads and are growing at an exponential rate! Th Investor Mindset focuses 80 percent of their content on the motivation and mindset that leads to success and 20 percent on the investing strategies and tactics that will get you there. I like this podcast because I believe mindset is incredibly important in order to become successful. Steven has already had some killer real estate investors on this show, and I look forward to watching it grow! If you want to improve your investor mindset, this podcast is for you. Personal Finance Podcasts Personal finance is the foundation of real estate investing. Without understanding your own finances, it is very difficult to build (and keep) wealth. This is why most lottery winners find themselves broke very quickly. For this reason, I recommend listening to personal finance podcasts, as well, in order to become well-rounded. You want to build a foundation that allows your real estate income to compound without needing to draw on it to pay your personal bills. BiggerPockets Money – Mindy Jensen and Scott Trench The BiggerPockets Money show is newer than the real estate podcast, but they already have 75 episodes to date. One of the most common questions real estate investors ask is, “How do I get started with no money or bad credit?” This podcast talks about managing your personal finances and improving your credit score in order to build a solid foundation for investing. They also talk about the financial independence retire early (FIRE) concept and how to obtain this by optimizing your personal finance behavior. If you want to improve your finances or your credit score, this podcast is for you. Related: No Credit? Bad Credit? 6 Steps to Fix Your Finances Choose FI – Brad Barrett and Jonathan Mendonsa With 130 episodes to date, the Choose FI show is one of the best-rated financial independence (FI) podcasts out there! They discuss reducing expenses, crushing debt, building passive income, etc. The goal of this podcast is to give simple, actionable steps in order to help you speed up the process of reaching financial independence. If you want to obtain financial freedom, this podcast is for you. Financial Freedom – Grant Sabatier This show is all about the premise that “money is unlimited, time is not.” The goal of the Financial Freedom show is to help you become financially independent as fast as possible. Guests share strategies for mastering money and living a meaningful life. Grant reached financial independence and “retired” at the age of 30. If you’re interested in reaching financial freedom at an early age, this podcast is for you. What’s Up Next – Paul Thompson and Doc G This podcast is different. I think that is why I like it. It features a panel discussion with two hosts and two or three guests on each episode. The guests are (usually) top influencers in the financial independence space that weigh in on questions that don’t have clear answers. If you like to hear experts attempt to answer uncommon, difficult questions, this podcast is for you! Bonus These podcasts don’t fit directly into the real estate/personal finance realm but are equally interesting to me! Smart Passive Income – Pat Flynn Pat Flynn is an influencer in the online entrepreneur community. He hosts courses on building a business/brand, creating podcasts, affiliate marketing, etc. I like this podcast because Pat Flynn was a large source of information for me when starting my online community. Pat has achieved massive success but has managed to keep things simple. He’s also never stopped helping “the little man.” If you’re starting a blog, podcast, or community, this podcast is for you. The Tim Ferriss Show – Tim Ferriss (obviously) Tim Ferriss is probably best known for his book The 4-Hour Workweek. Tim has been referred to as “the world’s best human guinea pig” by Newsweek. In this show, he hosts world-renowned guests from unique niches. He asks difficult questions to discover tips/tricks from these professionals that listeners can apply to their own lives. If you’re interested in entrepreneurship or hearing about cool cultural differences across the world, this podcast is for you. Jocko Podcast – Jocko Willink This podcast is about leadership and discipline. The description of this show online is literally only three words: “leadership and discipline.” Jocko Willink is a retired Navy SEAL Commander and bestselling author. His podcast is a wonderful gut-check for anybody looking to become a better leader. If you want to take ownership of your life to become more disciplined and a better leader, this podcast is for you. BiggerPockets Business – J and Carol Scott BiggerPockets Business Podcast is new and started with a bang. They advertise this show as a real-world MBA, where entrepreneurs guide you through what it really takes to start, scale, and sell your own business. I like this podcast because it brings everything together for entrepreneurs. It brings the same great quality that BiggerPockets brings to all of their podcasts and has already had some awesome guests, like BiggerPockets founder Josh Dorkin. If you’re an entrepreneur (or aspiring to be one), this podcast is for you. My Favorite Podcast My favorite podcast is the one I’m listening to at that moment. I love any show that answers questions I have or adds value to my life. There are so many great podcasts and great episodes out there. I recommend you try out every one on this list that sounds like it might be useful for you and figure out a way to fit podcasts into your daily life. Listening will speed up your journey to success and allow you to speak the language of finance nerds, investors, and entrepreneurs alike! What are you waiting for? Go download some podcasts! What else are you listening to that I didn’t mention? List your favorites in a comment below!   Free eBook from BiggerPockets! Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks, and techniques delivered straight to your inbox twice weekly! Actionable Advice for Getting Started, Discover the 10 Most Lucrative Real Estate Niches, Learn how to get started with or without money, Explore Real-Life Strategies for Building Wealth, And a LOT more Sign up below to download the eBook for FREE today! Click Here to Download the eBook Now! We hate spam just as much as you

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Real Estate Investing Basics

6 Ways to Gain Experience in Real Estate as a College Student

Is there any way for me to gain experience as a college student? This is a terrible question. Seriously, you’re setting yourself up for failure from the get-go with this mentality. The question needs to be, “How can I gain experience as a college student?” This simple mindset tweak is one that will serve you well for the rest of your life. I first heard this in Robert Kiyosaki’s book Rich Dad Poor Dad. He said that we need to train ourselves to think, “How can I afford this?” rather than saying, “I can’t afford this.” One of these questions puts up barriers and gives yourself an excuse to not find a solution. The other forces you to get creative and find a solution. With that said, here’s how you can definitely gain experience in real estate—no matter how young or old you may be. 6 Ways to Gain Experience as a College Student I often hear people use age as an excuse. They say things like, “I was going to do X, but I’ve got time.” Or they think, “I’m young. I can plan for retirement later.” The aged-based excuses take many forms, and I was once (regrettably) of the same mindset. My friend Jake Volin says that he feels the opposite is true—and I believe he is correct! I wish I had bought into this sooner. Many like Jake have cracked the code to success at an early age and used this to skyrocket themselves to success. Don’t wait. Start taking action to better your situation today! Here are a few of the simplest steps I can recommend for you. 1. Save The very first thing you can do is increase your savings gap. Your savings gap is the percentage of your income that you are able to save. For instance, if you earn $1,000/month and only spend $600/month, you have $400/month left over. This equals a 40 percent savings gap, also known as the savings rate. This is important because when you earn $1,000 it is taxed. When you SAVE $1,000 after you already paid taxes on the income, you get to keep it all! For this reason, slashing your expenses and living frugally is a huge way to start saving more money! Now, I know this doesn’t sound easy as a “poor college student,” but understand that pennies become dollars. Stop what you’re doing and complete a personal financial statement. You can find a couple of variations on the internet, but ultimately you just need to be able to track what you spent every dollar on last month. This will allow you to see exactly where your money is going. Save as much as humanly possible! The more you save now, the more prepared you will be to buy your first property. 2. Earn extra income With the exceptions of some very demanding programs, like military academies, you have time to earn some extra money at college. The problem is that we fill this time with partying, chasing tail, and playing video games. Or maybe you don’t waste time with these activities but instead stress too much about grades or social status. Whatever the excuse, it is beneficial to learn some time management skills and find time for a side hustle. Some of my favorite side hustles are driving for Uber/Lyft and delivery jobs (pizza, groceries, etc.). Alternatively, you could simply get an hourly job close to school. Be careful not to overwork though. You’ll need to have time and energy for the rest of these steps, too! 3. Learn The reason Uber and delivery jobs are my favorites is because you will spend a lot of time in the car. More time in the car equals more time to listen to audiobooks and podcasts! During this initial learning phase, you want to absorb as much content as possible via books, audiobooks, podcasts, and local meetups. The more you learn, the better! Read real estate investing books and personal development books, then listen to some real estate and business podcasts, too. I have spent days listening to audiobooks and the BiggerPockets podcast, absorbing as much information as possible! Take note of any word, phrase, acronym, or concept you don’t understand in order to search Google for an explanation later. By learning as much as you can and taking the time to fill the gaps with search engines, you will build a solid educational base, with very little money out of pocket. Also, some schools offer real estate programs. I have earned an associate’s degree in real estate studies, which is basically enough information to help you become a real estate agent. I don’t believe this degree is necessary at all for real estate investors, but I’m in the military and it was free, so why not! Related: 3 Simple Ways to Cut Back & Save Money Without Feeling Deprived 4. Network Building a network is one of (if not THE) most beneficial things you can do as a new investor. It’s also one of the most affordable! Look up local real estate investor meetups on the BiggerPockets events page, Meetup.com, or Facebook, and then start attending them. Most meetups are free (or super affordable) to attend and last two to three hours in the evening. Some of these events will have guest speakers; others will be less structured. The important thing is that you get out and attend as many of these networking events as possible. Don’t pretend you know everything either—nobody wants to help the guy who has it all figured out. Show up, be honest about where you’re at (a newbie), and be humble. Ask questions to get others talking about themselves, their projects, and their current struggles in business (this will be key later). One of the best ways to network is to learn as much about the other person as possible, and then follow up with them in a couple of days. If you have a solution to one of their problems, provide it! Even just a simple “thank you for X” will go a long way in them remembering you. Getting around people who are already doing what you aspire to do is a huge boost to both your educational base and motivation. It also allows you to bounce ideas off them and avoid making the same mistakes they did. I would be cautious about bombarding them with questions the first time you attend an event though. You don’t want to scare people away. On that note, DO NOT ask people to be your mentor the first time you meet them (or maybe ever). This may come naturally later, but don’t force it. 5. Add value Learning to add value is the fastest way to get into somebody’s trusted network. This is why I suggested earlier that you listen to the struggles other investors are having. If you can find a solution to their problem, it will pay dividends for you! Another great way to add value is offering to work for free. This could be as simple as sealing direct mail envelopes for them or helping with handyman tasks on a fix and flip. The sky is the limit here, but if you are willing to swallow your pride and work for free, it will allow you to get close to their business, ask questions, gain experience, and also build a relationship with that person. This can turn into mentoring later on, but again, let that happen naturally. Don’t push the issue. Elon Musk has a great quote: “You get paid in direct proportion to the difficulty of the problems you solve.” For this reason, you need to be thinking of ways to solve problems and add value to other investors—and in everything you do. It will pay dividends. I promise! Related: The Ultimate Guide to Building & Maintaining a Powerful Real Estate Network 6. Take action The final and most important step is to take action. All of your saving, learning, and networking doesn’t matter if you fail to take action. Your first deal will probably not be your best deal, but it will be the most important. You will learn so much by completing your first real estate investing transaction. From this deal, you will gain the confidence to invest again. You’ll begin developing a track record to attract private money lenders, too! Whatever you do, you must avoid the trap of analysis paralysis. This is where would-be investors learn, network, analyze deals, and never pull the trigger. The perfect deal doesn’t exist. Since that is the case, you can stop looking for it. Find something that makes sense, and go for it! If you think you’ve found a good investment, I would recommend bouncing the numbers off some of the investors in your network. If they don’t see any major red flags, go for it! Conclusion Is there any way to gain experience as a college student? Yes. Do so the same way most of us get started: saving, earning, learning, networking, adding value, and taking action. There is no reason why being a college student should hinder you getting started as a real estate investor. Any reason that you come up with is an excuse. So change your mindset, and conquer the world! What’s stopping you from starting your journey? Do you have any questions I can answer that might help you take action? Let’s talk in the comment section below!   Free eBook from BiggerPockets! Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks, and techniques delivered straight to your inbox twice weekly! Actionable Advice for Getting Started, Discover the 10 Most Lucrative Real Estate Niches, Learn how to get started with or without money, Explore Real-Life Strategies for Building Wealth, And a LOT more Sign up below to download the eBook for FREE today! Click Here to Download the eBook Now! We hate spam just as much as you

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Real Estate Investing Basics

Renting a Home Is Financially Better Than Buying—Wait, What?!

In the military, there is a popular idea that you should buy a house at every duty station. I don’t think this could be much further from the truth! Sure, buying a house at every duty station seems like great advice—to people that started in 2010. But what about the service members who bought at every duty station in 2004 to 2008? Obviously, there are great intentions behind this advice. I can certainly appreciate the thought, but as the saying goes, “The road to hell is paved with good intentions.” I have been on both the beneficial and detrimental sides of the equation. In 2015, I purchased a residence (in this instance, a house hack) at a duty station. Then I rented a residence (base housing) when I was stationed in Hawaii. I purchased my first rental property while stationed in Missouri as a recruiter. A year later, I moved to Hawaii and have spent the last three years renting here while investing in property on the mainland. How to Analyze the Market When Deciding to Buy vs. Rent Too many people get wrapped up in debating whether you should rent or buy your residence without understanding that it depends (mainly) on your market. One can argue until blue in the face that renting is dumb, but if the average home price is over $800,000 and won’t even come close to cash flowing, I would disagree. The real question you need to ask is, “Does my market appear better suited to renting or buying?” The market always dictates this decision for me—and it should for you, too. Related: 4 Reasons Renting & Investing Beats Buying & Owning, Hands Down How Much Are Homes in the Area? The first thing to consider is the average purchase price in your market. If you’re earning less than $100,000 per year, you probably don’t want to buy in a market where the average home price is over $750,000. The principal, interest, taxes, and insurance (PITI) alone could be $3,750 per month on a property like this! That means you could spend $45,000 a year on PITI—almost half your income. I think this expense should be enough to deter you. But just in case, remember that if you’re spending 45 percent of your annual income on a house, it will stifle your ability to save and build capital for future investments. That means you are placing your hope entirely on appreciation, which in my opinion is a gamble (more to follow on that). What’s the Status of the Population and Economy? The next thing you need to look at is population and economic growth—or lack thereof. Remember, in order for your home to be an investment, you need to buy it as an investment, not a home. That means you need to analyze the macro- and micro-factors that can affect a market. You want to see at least 1 percent population growth every year for the last two to three years. Real estate is a supply/demand business—the more people that need homes, the merrier! You also want to see a growing economy and ensure that its growth stems from diverse industries. An argument for the necessity of diverse industries is Detroit. The once booming metropolis has declined in population and economic prowess year-over-year for decades. Why? Because it relied too heavily on one industry: automobiles. For this reason, I like to see at least three different industries alive and well in my markets! For example, the area where I invest has three growing colleges, a booming industrial district, and several food/beverage manufacturers—not to mention being a transportation hub along a major interstate! Look for diverse, growing industries to ensure a steady stream of new jobs that will keep the population growing. Where Are We in Terms of Market Cycles? Nobody can know for sure what a market will do in the future. We can, however, understand what a market has done in the past and determine where it is in the typical cycle. For example, in 2005, the median home price in San Diego peaked at $572,900. In 2011, the median home price bottomed out at $370,300. Now, the same county has reached a median home price of $627,700. As such, it can be reasonably assumed that we are (at the very least) near the peak of the market. Understanding market cycles and weighing them into your decision-making process is critical. I am moving to San Diego in a few months and have decided to rent (or live in an RV) for several reasons—one of which is where we are in the market cycle. I’m not confident enough in the market continuing to trend upward to justify buying a $600,000 home. The nice thing is that renting in an expensive market (where the median income is higher) can afford you opportunities to pump additional saved income into a more affordable market! Related: When Renting Makes More Sense Than Owning Numbers to Consider When Determining Whether to Invest Cash Flow Cash flow is the lifeblood of rental property investing. When your properties are producing positive cash flow, (almost) any storm can be weathered. If your properties are not cash flowing, it opens the door for disaster to strike. Cash flow, for those unfamiliar with the term, is simply the amount of money you receive from monthly rental income after you have budgeted and paid for all expenses. Cash flow is important because you can reinvest profits into more properties. This is a less-discussed factor in the rent/buy decision—but one that is so critical. When a recession hits, cash flow allows you to continue holding properties even if the property value drops. (It is much easier to hold onto a property that has lost value when it is paying you to do so.) Unfortunately, it can be very difficult to cash flow in expensive markets. This is because the cost of a mortgage loan climbs higher than average rent prices in the area. Do not buy a rental property that doesn’t cash flow. Seriously. Don’t do it! Cash-on-Cash Return There are many people in Hawaii who say, “But it is possible to buy cash flowing real estate here.” And they are correct. But generally, buying here is still a terrible investment! The cash-on-cash return is my strongest argument against buying in overly expensive markets. Let’s say you find a property to cash flow $500/month in Hawaii. Is that a good amount? Maybe. The problem is that you likely had to spend at least $600,000 (probably much more) to purchase this property. Assuming 20 percent down, this property required $120,000 as a down payment. $500/mo. x 12 mos. = $6,000/yr. That is a 5 percent cash-on-cash return. Now, let’s say I buy a property for $100,000 with a $20,000 down payment in the Midwest. This property brings in $200 per month in cash flow (a conservative number in my market). $200/mo. x 12 mos. = $2,400/yr. That is a 12 percent cash-on-cash return. At this rate, putting that same $120,000 (used as a down payment for the $600,000 property) into six $100,000 properties instead would bring in $1,200 a month (as opposed to the original $500 per month). Which market was the wiser cash flow investment? Obviously, the cheaper one. Appreciation Appreciation is the number one justification for buying in overpriced markets. I tell investors who solely focus on appreciation that I’ll cross my fingers for them. Appreciation is a great bonus to cash flowing real estate, but it is just that—a bonus! I believe this because nobody knows what the market will do next. The homeowners who lost everything in 2008 thought the market was going to keep improving. The people who failed to buy in 2011 (bottom of the market) did so because they were convinced the market would continue going down. Sure, appreciation can be a huge windfall when the market skyrockets after you purchase a property. But I don’t believe this outweighs the damage that can happen when the market tanks and you lose everything. There are ways to plan for appreciation—purchasing after a crash, forcing appreciation through renovations, buying well below market value, etc. These are all viable strategies. However, too many people buy in places like Hawaii, San Diego, or Washington, D.C. without being realistic about where we are in the market cycle or what could happen to their properties. Don’t bank on appreciation. It shouldn’t be your motivation to purchase real estate. Appreciation is a great bonus, and that is how you need to view it. Bottom Line There is no shame in renting where you live and buying elsewhere to invest. Heck, Grant Cardone even does it, and he is one of the largest real estate syndicators in the nation. I think pride is often what drives the idea of buying a house no matter where we live. “I’m a real estate investor, and real estate investors own homes.” It’s a great idea in theory, but don’t let it influence you to make a bad decision. Always remember to buy a residence as an investment, not a home. If it doesn’t make sense as an investment, don’t buy it. The only exception I would make here is if the home is your “forever home,” and you can cover all expenses through your other investments. Make no mistake though, that home will be a liability—not an asset! Do you agree or disagree? If you think I’m wrong, tell me why! Leave a comment below.    Free eBook from BiggerPockets! 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Personal Development

6 Reasons You Might Be Struggling to Succeed (& How to Fix Them!)

We have all heard that two-thirds of business startups fail in the first decade. If you’re like me, you encountered this statistic but dismissed it, telling yourself, “That won’t be me!” Now, a couple of months or years later, you may be wondering why things haven’t taken off like you thought they would. This issue could be plaguing your real estate business, social media platforms, a startup business… maybe even your personal brand. Why You’re Struggling to Become Successful Here are the six reasons I find most people struggle to find success—and how to fix them! 1. You’re not setting goals Would you depart friendly lines with a convoy without knowing your checkpoints? No. Would you step off on a hike without knowing your mission? No. So why would you walk through life without goals? The short answer is you shouldn’t. The Marine Corps teaches the importance of setting S.M.A.R.T. goals. The acronym refers to: Specific: Rather than saying “get in shape,” define what you specifically want to achieve, such as losing weight, toning up, etc. Measurable: Rather than saying “lose weight,” say “lose 10 pounds in two months.” This is a quantifiable goal and can be tracked. Attainable: Ensure your goal can be accomplished. Realistic: Be honest with yourself, and keep in mind any obstacles you may need to overcome. Time-bound: Set a deadline. Deadlines are key to accomplishing your goals, but you must adhere to them! 2. You don’t practice accountability Nobody is perfect. We all know this to be true. For that reason, it is extremely helpful to have someone holding you accountable to your goals. Going back to our fitness example above, even the most motivated person will eventually have a day where they don’t want to work out. A good workout partner will hold you accountable and not let you skip. This works the same with any goal. Accountability can take many forms—it could be a weekly mastermind meeting, your spouse, a friend who you ask to hold you accountable, etc. The important piece is to have checks and balances in your life that ensure when your moment of weakness comes, you can resist it! 3. You’re making excuses Nobody cares about your success more than you do. So stop making excuses, and start doing. Stop worrying about problems, and start finding solutions. It is imperative that you do something every day in order to move the needle forward. Making excuses will accomplish nothing; it’s simply wasting your time (and anyone unfortunate enough to be listening). This is why I have friends like Alex Felice, who are so quick to tell me when I’m starting to make excuses. We are all human, and it is natural to make excuses—sometimes without realizing it. Much like accountability, a friend who can see through your B.S. is invaluable! There is a popular phrase in the military, “Excuses are like a**holes, everybody has one, and they all stink!” While crude, this is the way you need to think of excuses. They don’t move the needle forward, they don’t make you feel better (in the long run), and they have no place in your life! Related: 6 Ridiculous Excuses That Are Holding You Back From Real Estate Success 4. Your network sucks It is said that your wealth is the average of the five people you spend the most time with. If you’re the smartest person in your network, you need to find a new network. These statements might sound cliché, and I’m sure you have heard them before. But there is a reason they are repeated often: they are true! You don’t need to cut all of your friends out of your life, but there is nothing wrong with ditching the “negative Nancys” for some “positive Pauls” (pretty sure I just made that up). Seriously, if the people around you aren’t helping you grow as a person and accomplish your goals, you need to improve your network. A good way to do this is to attend real estate investor meetups and get busy meeting people with similar goals! Every time I attend a real estate investor meetup, I am amazed by the growth I experience. Improving your network is (in my opinion) the most important thing you can do to become successful! 5. You aren’t learning You need to learn something new every day. Formal education is great and all, but that isn’t what I mean. You need to learn something every day that will help you achieve your definition of success. For real estate investors, this could mean reading a book on real estate, listening to a podcast, or having lunch with a mentor. Search Google for useful blog posts or YouTube videos during your free time! The point is that you need to set aside time every day for personal development. I believe that the best investment you can make is in yourself! Don’t overlook opportunities for growth. Daily growth compounded over time will make you into a very successful person. Conferences and seminars offer a bonus perk: they are an excellent way to combine personal development and networking! I love attending these events to grow personally and build my network, while simultaneously getting a motivational boost! Related: The 4 Levels of Learning in Real Estate Investment 6. You’re not taking extreme ownership Everything is your fault! Much like making excuses, failure to take responsibility for your situation is a waste of time and not conducive to improvement. In his book Extreme Ownership: How U.S. Navy SEALS Lead and Win, Jocko Willink uses the example of being five minutes late to work. Is being late to work because of traffic your fault? Yes. Because if you had left the house 10 minutes earlier, you would not have been late. Will Smith has a great motivational video about the difference between fault and responsibility. In his short clip (which I recommend that you watch by searching “Fault vs. Responsibility” on YouTube), he states that whether or not something is your fault, it is still your responsibility. An example is that it’s not your fault if your significant other cheats on you, but it is your responsibility to decide how you’re going to react. It is also not your fault if somebody passes away, but it is your responsibility to cope with it. The main theme with both of these resources is that we need to act less on a “woe is me because X, Y, or Z happened” mentality, and instead think in terms of “this happened, so how do I fix it?” or “this happened, so how can I ensure it doesn’t happen again?” It isn’t easy to take extreme ownership when things go wrong, but it is much more productive. This mindset shift will open a lot of doors to you as a leader, and the better I get at this, the more successful I become as a leader of Marines. Conclusion Now that you are aware of these six reasons you’re not succeeding, it is time to utilize extreme ownership and change! Knowing your deficiencies will always give you an edge over the competition. But that edge is useless if you don’t constantly improve. That is why you need to constantly work on all six of these issues, and look for ways to grow. What are you currently working on for personal development? Share in a comment below!   Free eBook from BiggerPockets! Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks, and techniques delivered straight to your inbox twice weekly! Actionable Advice for Getting Started, Discover the 10 Most Lucrative Real Estate Niches, Learn how to get started with or without money, Explore Real-Life Strategies for Building Wealth, And a LOT more Sign up below to download the eBook for FREE today! Click Here to Download the eBook Now! We hate spam just as much as you

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