Let’s face it. It is tough living in a big city. It is no secret that life in a big city is seriously expensive. With ever-climbing costs, the situation just keeps getting harder. To top it all off, there’s the the skyrocketing costs of real estate! It’s just not easy to find an ideal spot worth investing in. Soaring prices, bad neighborhoods, and an overcrowded market are all big reasons so many would-be investors simply don’t ever get to it.

Everyone knows what happens when demand is high: Prices rise.

So, do you still want to follow the crowd and call a tiny patch of land with a tiny set of rooms your own? If so, then invest in the West Coast and East Coast. Investing there may be one of the stupidest things you can do right now.

Now, you might be thinking, why on earth is investing on the West and East Coast such a bad idea? Well, it’s because huge hedge funds have raised billions of dollars and bought tons of available properties. The first ones they bought were the best deals. There are absolutely no deals left, and the few available are usually not even worth the sweat. Right now, you would be paying top dollar and getting a crappy ROI to boot. But hey, you tell me. How does a $300,000-$500,000 single family home that rents for between $1,200-$1,500 per month sound? Does that seem like a good deal to you? Let me answer that for you: not at all! These are ridiculous and lousy investments in my opinion. I would rather stay in bed sleeping than wreck my balance sheet buying properties like this.

Why All Investors Should Consider the Midwest

Now, if you are someone who refuses to be a follower, I might have some awesome news for you. Think Midwest. Yes, you heard me. The Midwest is where all the real estate action is. Wake up and smell the roses. City dwellers won’t even believe how far their money can go in the Midwestern states. Here, you’ll end up spending almost one-fifth of what you’ll shell out on real estate in any area on the East or West Coasts.

Yes, life in the Midwestern region is different. Yes, it’s less crowded there and a lot quieter, but isn’t it better to have more space, more conveniences, and a stunning piece of real estate at knock-out prices? Well, many people with families would argue that it is indeed better to live there than anywhere else. With top-rated schools, the possibility for a high-end lifestyle, and effortless connectivity all finding their way to these locations, there isn’t much to complain about.

Related: 28 Smart Questions to Ask a Broker When Investigating Out-of-State Markets

The Midwestern region is known for its scenic natural vistas, which are virtually non-existent in big cities, thanks to rapid urbanization. Most Midwestern areas offer an incredible lifestyle at extremely lucrative prices. So what is the catch, you ask? Well, there isn’t any catch. The cost of living here is much more reasonable than in most big cities. This means people get to save way more than they could ever manage in the big city! Comparatively an under-explored market, the Midwest has potential beyond compare!

Why should you care as an investor? Because these Midwestern families are your future rentals. There’s such a clear demand for rental properties in the Midwest.

5 Reasons to Consider Midwest Investments

But there’s more. When was the last time you felt like a kid in a candy store? With deals so sweet you will feel like a kid again, the Midwest is sure to bring back some great feelings. Why? Properties are available between $50,000-$70,000. In addition, many of these $50,000-$70,000 properties will bring in a rent of $700-$1,000 per month. Now, I don’t know how good your math is, but this gives you a ridiculously high ROI. Many of these houses could be found in solid B areas! You can think of the Midwest as a hidden gold mine waiting to be explored. In many parts of the Midwest, a mere $1 million will buy you a stunning mansion with acres of open space surrounding it. You might even get a lake-facing property, or one with a huge pool and a car collector’s garage!

Let’s face it — life is too short to be spending your time in cramped spaces. Many people feel that way, and that’s why the Midwest is such a success for families. Of course, living in a place that doesn’t resemble a chicken coop is a big plus as well.

Take advantage of the low cost of living and low-priced properties. Invest in properties that give you a perfect ROI and do not burn a hole in your pocket. And there ain’t any place like the Midwest to do that! Here are five things that we absolutely love about the Midwest:

  1. It is so well contained and life is so much simpler. Its unspoiled solitude is both captivating and oh-so invigorating. Translation? Happy tenants. There’s no big city pressure in the Midwest; everything is just nice.
  2. Low cost living! An affordable lifestyle with all possible luxuries to go with it is never a distant dream here. That means more cash for rent. It also explains, in part, why rent is relatively high here. It also means that maintenance may be cheaper as well. Don’t forget, especially if you’re living on the East or West Coasts, your hard-earned cash simply has more milage in the Midwest.
  3. While big cities might be known for neon lights and crazy traffic, the Midwest is known for its serene outdoors and calming silence. Compared to busy city life, the Midwest is like an oasis. There sure are some really beautiful locations. It’s also perfect for the average family: Great family trips assured.
  4. The Midwest might not be the center of a bustling universe, but there’s still a lot of activity here — economically speaking, that is. There are few financial headquarters, many factories, and an overall less-corporate environment. There are loads of good blue-collar workers, jobs, and job stability.
  5. There’s a notable lack of pretension. Why is this important? Well, in terms of the maintenance and amenities you need to provide for a mid-class home, it makes a huge difference. People’s expectations are usually a bit lower, and that means easier tenants. It’s not a huge difference from the Coasts, but it’s still noticeable to investors.

Now, those of you who know me know that when I speak about good investment opportunities, I never talk about the appreciation of a property. Right now, the East and West Coasts have some decently appreciating real estate. The thing with appreciation, however, is that it’s basically anyone’s guess as to where it’s going. Many people buy an expensive property and hope that it increases in value in a record amount of time. You might call it investing, but I call it gambling. You know, all I care about is a good cash flow from properties. If you think about it, that’s all that matters. And it’s exactly what the Midwest has to offer. Don’t ask me about where the properties are going in terms of value because I simply don’t care.

Add in extensive homeownership (thanks to some of the lowest average home prices in the country), simple lifestyle, and low-cost living, and you’ve got the perfect mix for investing in properties. After all, homeowners take care of their homes and make living in their neighborhoods as nice as they can.

Related: 4 Things to Do With Extra Cash in a Low Inventory Housing Market

Check it Out for Yourself

Of course, I understand that if you’re currently living somewhere else, it’s hard to imagine what it’s like elsewhere. It’s why I always recommend that people go check it out for themselves. Know where you’re investing. Think about traveling to the Midwest, and check out some properties in areas that appeal to you. It doesn’t matter that you won’t be living there  it’s just always nice to know that you understand what living in a certain place is like.

Above all, considering a purchase price of $60,000 for a single family home with a rental income of $800 each month, you’d be hard-pressed to find a deal with a similar return anywhere else  especially if you take into account that one $600,000 East or West Coast home buys you 10 of these Midwestern homes. I personally own 20 properties and am looking to buy another 30 by the end of the year.

How’s that for a passive income?

We’re republishing this article to help out our newer readers.

Where do you invest — and why?

Let me know your thoughts on the best real estate markets!





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Walker & Dunlop wants to increase it’s investment sales volume by $2 billion and hired Bobby Gatling away from CBRE to help with the effort. In his new role, Gatling will be responsible for originating and executing the sale of multifamily assets in Central and North Florida.



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To push forward the real estate industry, JLL has created a $100 million investment fund for real estate technology development. JLL Spark and its team of veteran Silicon Valley entrepreneurs have been tasked with dishing out this seed money to worthy tech startups.



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I never plan to sell a single multifamily property, and here’s why:

I’m Going Long

I’m in it for the long haul. I’m not just thinking about how to make money next month, hit a goal this year, or get rich in five. My eye is on the long game. I’m looking 10, 20, 50 years down the line and beyond.

It’s a Lot of Work

Sourcing, screening, negotiating, and closing on multifamily apartment buildings takes a lot of work and time. Often, that is just the beginning. Once purchased, you must deal with tenants. You’ll have to market the units, and you’ll probably have to renovate and improve the property at some point. Compared to the long-term rewards, to me, it doesn’t make much sense to sell after putting in all of that work. I want the best returns on my time and money. I want to know that I am really doing something worthwhile — something that will last. 

Related: Attention Multifamily Investors: Are You STILL Paying Taxes?

Taxes

The quick cash and returns some people rave about from flipping and wholesaling houses can sound really attractive. Until you do the real math and pay your tax bill. They never talk about taxes on reality TV. They talk about gross profit, which is in a completely different ballpark from net profit. You pay a lot less in taxes on long-term gains and passive income dividends than on active income or short-term windfalls. I’m not trying to give up a large fraction of the gains I work so hard to earn in real estate investing. That’s just not my model.

Speculation

I believe it is just too much of a gamble to buy a property in the hopes of selling it. Especially after putting countless hours, energy, and precious capital into renovations and improvements. Some people say that you make your money when you buy, but really, you make your money when the property puts money in your pocket. I know I can do that with cash flow from tenants right away. There is never a guarantee that you can flip for a certain figure (or even sell at all). I see many investors setting themselves up for difficulties right now, overpaying for properties with hopes of flipping. None of the thousands of investors who got caught in the last crash expected they would get stuck with those properties, but they did. I buy for cash flow.

Related: Why the Wealthy Put Their Money Into Multifamily & Commercial Real Estate

Net Worth

Even the best properties may fluctuate in value at different times. Yet, in the long run, these assets keep going up in value. After all, what are you going to do with fast money anyway? Stick it in the bank at negative interest rates? Or stuff it in your mattress to devalue? I’m looking at long-term wealth building, which will in turn increase my real net worth. By holding multifamily properties long term, extra losses on transaction fees, taxes, commissions, can be avoided.

Summary

I’m not selling anytime soon. I’m going long, and never plan to sell my multifamily property investments. That may not be for everyone, but before you are quick to judge, do the math on the above factors and give it some thought.

We’re republishing this article to help out our newer readers.

What about you? Have you sold and regretted it?

Or am I missing something about flipping that you think I should know?





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Your first deal might just be your most important — because it leads to all the rest. That’s why it’s so imperative to study others who have just recently purchased their first deal! So today we’re excited to bring you a mashup episode, in which we sit down with three different investors to hear how they bought their first few investment properties. You’ll hear how Bill went from ex-con to house hacker, how Jacob used some highly creative methods to find his first deals, and how David is building an empire from across the ocean. Don’t miss a moment of this powerful episode!

Click here to listen on iTunes.

Listen to the Podcast Here

Watch the Podcast Here

Help Us Out!

Help us reach new listeners on iTunes by leaving us a rating and review! It takes just 30 seconds and instructions can be found here. Thanks! We really appreciate it!

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In This Episode We Cover:

Bill

  • Being imprisoned for 10 years
  • What changed in prison for Bill
  • Starting your business on the side
  • How he ended up investing in real estate
  • What went in his head with his first investment property
  • The beauty of keeping expenses low
  • Having tiny little steps

Jacob

  • Jake’s investing path
  • How he got into real estate
  • Buying a $25,000 house with a $140 monthly mortgage
  • Going for the smaller banks
  • Investing at a very young age
  • Joining local Facebook pages
  • His criteria for finding properties

David

  • David’s story and how he got to Hawaii
  • BRRR, OD, and HELOC
  • Paying close to 5 percent on a 10-unit apartment
  • Having a great team you can trust
  • How he built a meet up in Hawaii
  • And SO much more!

Links from the Show

Books Mentioned in this Show

Tweetable Topics:

  • “My success story didn’t started when I got out (from prison), it started right away in the very beginning.” (Tweet This!)
  • “Quit the things that are holding you back and have you put in the exact location you are.” (Tweet This!)
  • “Find a market that makes sense.” (Tweet This!)
  • “I want to buy something that is certainly desirable.” (Tweet This!)
  • “Highest risk is vacancy.” (Tweet This!)
  • “Become a person worth being around.” (Tweet This!)
  • “If they’ll like you, they’ll join.” (Tweet This!)

Connect with Bill

Connect with Jacob

Connect with David





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Recent research suggests that U.S. landlords experienced an increase in competitiveness, and global real estate investment and corporate activity were at their highest levels for a decade in the first months of 2018, according to a new report from Jones Lang LaSalle.



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Student loan debt is a HUGE problem facing millions of people – and it continues to grow every year. Today we are joined by Travis Hornsby from Student Loan Planner who shares several options for paying back your student loans, including loan forgiveness.

Travis shares his rule of thumb for deciding whether to pay off your loans or take the forgiveness route, and tips for refinancing your student loan debt. He also gives future college attendees a few things to consider BEFORE choosing a major.

This episode is for anyone with student loan debt – or anyone with kids facing this choice. Travis also shares how you can still pursue Financial Independence while paying down your student loans.

Packed with actionable advice, this is an episode NOT to be missed!

Click here to listen on iTunes.

Listen to the Podcast Here

Watch the Podcast Here

Help Us Out!

Help us reach new listeners on iTunes by leaving us a rating and review! It takes just 30 seconds. Thanks! We really appreciate it!

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Betterment is an online financial advisor that can help you strive for higher returns. Don’t let high 401(k) fees drain your savings. Rolling over an average 401(k) to a Betterment IRA could mean 60% lower fees.

Get a clear view of your net worth by syncing your outside accounts, such as bank accounts and other investments. You can also see how much your outside accounts are costing you in fees and uninvested cash. Visit Betterment.com

In This Episode We Cover:

  • Travis’ financial journey
  • His career after graduating from college
  • His first job and how much he earned from it
  • Living with 5 guys and only 1 bathroom in the house
  • What he was invested in
  • His travel journey and a period of unemployment
  • How long it took him to get $10,000 a month in income
  • The biggest problem he sees in the whole student loan industry today
  • A case study example of loan forgiveness and paying a massive debt off
  • Public service loan forgiveness
  • Having an Income-driven plan
  • What are the strategies and ways students should be thinking ahead of time to set themselves up for better options
  • How to refinance your student loan debt
  • And SO much more!

Links from the Show

Books Mentioned in this Show

Tweetable Topics:

  • “Take a step back, pause, and ask yourselves, ‘Is this the right decision for my life?’” (Tweet This!)
  • “I just want to make sure that when people do it, it’s definitely the right decision because once you do it, you cannot undo it.” (Tweet This!)
  • “Just have skills and be flexible with your finances so that you can be a part of it.” (Tweet This!)
  • “Anybody can be successful coming from any level of financial gifts or intuition.” (Tweet This!)

Connect with the Travis





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In this world of real estate, there are some truths—but there are also many lies. I assume since you’re reading this that you’re interested in real estate wholesaling. Let’s dive into some of the most common real estate lies about wholesaling.

Lately, I’ve been doing 30-minute free strategy sessions with aspiring wholesalers. I take this time to introduce newbies to the world of real estate investing. During these sessions, they can ask me anything about real estate and wholesaling more specifically. What I’ve found is that there are a ton of misconceptions out there, and I want present the truth.

The 8 Most Common Lies Newbies Believe About Wholesaling

1. Wholesaling is illegal.

This is the biggest question I’m asked. My answer, despite what critics might say, is no, wholesaling, at least how I do it, is not illegal. I am here to clarify that brokering a real estate transaction without a license is illegal. There is a small gray area, and although I do not like to operate in the gray area because I consider myself to be somewhat conservative, I tell aspiring wholesalers to get their license to eliminate that gray area.

Do not broker deals without a license. As a wholesaler without a license, you need to ensure you clarify with your seller that you are purchasing the property and not finding an end buyer. I know this is small semantics, but it is key that you clarify this. Again, I am an advocate for getting your license to help minimize risk. Plus, having a license may also help open other doors.

wholesaling-newbie

Related: 5 Ways to Lose Your Wholesale Deal (After Signing the Contract)

2. Wholesaling is dead.

Yes, I actually heard this. Although in many markets it’s harder to find deals, this strategy is not dead. I have a deal closing next week in one if the toughest markets in the nation.

I agree that it is much more challenging than it was just two years ago. During this time of market saturation, you have to be more creative and liquid to find deals.

3. You absolutely have to have a license to wholesale.

As I explain above, this is an advantage but not a necessity. This is just my advice. You can draw your own conclusions, but you do not have to have a license. Is it more beneficial? Yes.

4. You can be successful without money.

Let’s be clear: You cannot get something for nothing. Keep this in mind. You definitely cannot sustain a business without money. Can you get started with limited money? Yes, but you will have limited success.

5. There’s no risk involved.

This is the most audacious remark I’ve heard. What investment strategy that you know of has no risk and no downside? None. Here is one of the risks: You can be sued. Yes, this is a possibility. I don’t want you to have a false sense of security thinking that you can do this and not face any challenges. I’ve seen and heard of wholesalers being sued by the seller, the buyer, and other wholesalers.

Beware and get educated.

wholesaler-benefits

6. Wholesaling is for beginners only.

I am here to inform you that many seasoned investors still wholesale. Is it their primary strategy? Well, of course not. However, there are times where you have a deal is too sweet to pass up, but the deal does not fit your model. You’re not going to let money run through your fingers. As an entrepreneur, you look at every possibility to leverage your resources.

Many non-beginner investors I know personally wholesale a lot of deals.

7. You can virtually wholesale deals by yourself.

Now, this is a bunch of crap. Virtual wholesaling is difficult, and you cannot do it alone. It’s actually more important to have a team when virtual wholesaling rather than  wholesaling in your local market.

I’ve heard of courses that inform aspiring wholesalers to simply virtually wholesale if the local market is too competitive or saturated. Is virtual wholesaling a possible? Absolutely. I’ve done many virtual deals, but you have to have a strong team in place. This team may consist of a wholesaler in that market, birddogs, attorneys, title agents, etc. This is not a task you want to try and implement independently.

Related: A 60-Day Action Guide to Wholesaling Your First Property

8. Real estate agents hate wholesalers.

I’ve heard this quite often, and although the real estate agent/wholesaler relationship sometimes may not be the greatest, this isn’t always the case.

There are real estate agents who work with investors and who love wholesalers. This is because wholesalers can provide agents’ clients with off-market deals. This helps agents show their clients that they are embedded in the local industry. Agents can make a lot of money from wholesalers. I get that many agents believe wholesalers are taking possible listings. However, if wholesalers hand off below-market deals to agents, that is a benefit for the agent and his/her client. We have many agents on our buyer’s list, and you should too.

Remember, when you hear a negative statement, you must evaluate the source. Some of these lies are from those who have ulterior motives. When working to be a wholesaler, you will encounter many things that can skew your perspective. By reading this article, you have the upper hand on your competition.

We’re republishing this article to help out our newer readers.

What wholesaling myths and lies have you encountered?

Comment below!





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New home sales fell by 1.5% in April, but industry professionals seem unconcerned and predict a continued upward trend in new home sales going forward.



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Tech startup First.io announced Tuesday it raised $5 million in its Series A funding round. Chicago-based startup investors MATH Venture Partners, Nine Four Ventures, and @properties’ co-founders Thad Wong and Mike Golden, leading the investment round.



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