All Forum Posts by: Henry Clark

OP.  The US is the greatest country in the world.  If it’s the rhetoric turn the TV off and don’t watch those types of YouTube.  US was intentionally not built to go in a straight line. It was built to have both rich and poor.

With that said.  Our experience.

1.  Belize-  highly recommend it.  Easy to get residency.  Low or no property , income or capital gain taxes.  Bribery, slow government, no high end medical.  Good cheap low end health care.  Great place to have a tooth filled or to break an arm.  English is the major language.

2.  Korea- language barrier.  Health care is the tops and cheap.  Didn’t check out taxes or residency.  

3.  Italy Sicily.  Love them.  Housing cheap or expensive depending on you.  Health care is tops and inexpensive. But socialized.  My sister in law had heart surgery. 5 people to a room.  No curtains.  3 guys with psych issues.  Limited visitor times.  

4.  Croatia-  just visiting.  Beautiful.  Not as cheap as I had heard online.  

5.  Albania-  if your looking for cheap go there.   They love US.  

6.  France- is French.  

You need to prioritize-  health, taxes, residency, do you have money or need to make money, education if young kids, etc.

I still pick the U.S.  Everyone wants our Blue passports.  And they know what they are leaving.  

OP land can sit for several years.  Unless you have a ready USE, it will cost money to hold.  Even if you don’t buy outright, your wholesaling, you will need to put some money down for the rights.  

You really need a pocket load of investors to make this work.  For land or commercial it is a lot harder to find a buyer than residential.  

We buy land.  But we have ready uses for Self Storage or Country Lot subdivisions.  Thus we take more of a Buyers market approach and dictate the price or move on.  

OP do a search on your target areas.  Talk with realtors.

1.  Look for any listing over 1 year old.  No new listings.

2.  Look for properties over xx acres.

3.  In your price range.

4.  Nasty properties.   Example old farmhouse on 20 acres.  To much land for most buyers.  They won’t like the old house or trailer.  Not as much price competition.  Divide the house off and sale it.   You keep the rest.

5.  Recommend as before you look up State Transportation department land sales.  

OP.  YOU are different.  Dont go down the path other investors are following.

If you use the following two tools which you either know or can learn in 30 minutes you will be ahead of 90% of all RE investors anywhere.

1.  Use your BAH tax free payment to the max.  Max your monthly home payment to match your BAH payment.   No one else gets tax free money from the government that does not get taxed and doesn’t have to be paid back.

2.  Unless you have a cash snowball for investing built up, keep selling your house at each base.  Use your $250k per spouse to not pay capital gains.  Check on perks for military using this.  Your special.  Even if you sale your house for the same price you bought it, you make money.

3.  Get your RE license or your spouse to reduce transaction fees. 

4.  When you get out of the military go civil service.  They pay BAH for overseas assignments.  Do the same thing all over.

5.  When you get out of the military again join civil service.  Your years of military service add to your civil service.   So you get a second retirement real fast, like year 1. 

Don’t follow other RE investors.   Don’t take any training.  

If you have cash built up, I would look in Hawaii.  

OP if you’re approaching this from an investors standpoint.  I would play the dips.  Buildup cash now.

A.  Your chart shows the next dip.   What goes up will come down.  Wait for the builder specials. Once the downturn starts.  Find a development that just started, they will be hurting. 

B.  Stock market will crash.  First thing sold will be luxury items like BNBs.  Find your market now.  Get to know it.  Get to know realtors and lenders there.  Make the plunge.  Just recognize you will need to carry for a year.  

   C.  Covid type event.   Same as B above.  Especially for tourist areas.  

OP the answer is in your chart.   The spike occurred in 2020 to 2021.  Same period as Covid impacting the economy.  Affordability will naturally go back down.

1.  Lumber tripled in price.  Covid shutdown mills especially in Canada.   Also large forest fires slowed or shutdown Canadian logging in areas.  
2.  Hardware used in housing was restricted with made in China.   Stopped at the ports since ports were shut down due to Covid and strikes.  
3.  Cement costs have significantly increased due to Covid.  Plants shutdown.  
4.    Labor shortage due to COVID government payments.  
5.  Businesses received COVID payments injecting financing into new projects.         
6.  People received COVID payments and purchased goods causing inflation.

7.  Contractors lost money on fixed price build contracts.  They had to recoup with higher pricing.  

Believe the government injected over a years worth of GDP into the economy.

Think of a Bull Whip.   Long wind up, then a pop at the speed of sound.  We are in the Pop section.  It will take a couple years for the above to unwind.

Covid had more dollars chasing limited resources.  During this time we were building a new Storage location.  We needed 20 truckloads of cement to pour.  Pretty big right?  We were small potatoes.  Only got 5 loads per day, plus late in the day.  Always want to pour early.

Prices will go down.  Say 2 years starting now.       

But we have a new issue on the horizon.  China is economically imploding and they also have become to expensive.  They are no longer a low cost producer.  The supply chain will need a decade to find new sourcing.  Or lower cost.  

Answer to affordability is to have more people live in the unit, step down in type of housing, or move to affordable housing.  My neighbors son is 2 years out of high school and just bought a house using his money.  Combination of right professional choice (hvac) and buying in a lower cost market (small town).  

OP math won’t work.

1.  Buy a larger piece of farm ground.   Subdivide the waste ground off and keep.  Sell the good farm ground.  Farm ground itself won’t cash flow as you mention.  Our area $250 rent on $10,000 per acre.

2.  Do the same thing with a home property sale. 

3.  Look up land auctions by your states road department.  Might happen every couple years.  Usually odd shapes and sizes.   Good for your purpose possibly.  

OP if you have the time and inclination work for Habitat for Humanity on a couple projects to get base hands on knowledge.  

OP

1.  If using a construction loan make sure to factor in the interest during your holding period.

2.  Have your contractor and subcontractor add you as “Additional Insured” to their policies until done.   Has to be renewed each policy year for them. 

3.  Even though you will be covered by the contractors insurance, buy a liability policy yourself.  Cheap. 

4.  Get subcontractors to sign lien waivers or invoices saying paid in full at end of contract.  

Assuming this project will be longer and more expensive than your prior projects, so would take these steps.  
Good luck with project.