Introduction - Real estate - back to the drawing board - onward and upward

[cshervheim]

My name is Charlie, I am located in the midwest of the United States. Recently read the Fastlane Millionaire for the second time, after reading I subtly suggested the book to two family members in hopes they would also appreciate and be accepting of the mindset shift in thinking. So far there has been positive feedback.

My wife and I recently bought a duplex we have fixed up over the last 5 months. We are now looking for a tenant and are located near a large university. Coming from low income childhoods we saw building a real estate portfolio as a route to wealth. Buying duplexes and living in half to qualify for better loans, rinse and repeat. The capital needed for each property investment is substantial and the trajectory to become detached from this money tree will include large sums of capital investment and ultimately a team of property managers. We are still pleased with the choice to do this first investment but after reading Fastlane Millionaire for the second time I am rethinking our plan and think it might be a solid slowlane route.

Real estate is a corner stone need for humans so I feel confident there is potential in this area. The first approach of simple buying and renting out property doesn't have the element of exponential growth. Through this first property there may be an opportunity that becomes more obvious that needs solving through technology like some sort of service to provide to other landlords/renters.

We both work decent 9-5 jobs and have brought this property up to standard in our free time, we are both on board that our initial plan may need some reworking and are optimistic we will find a route to do just that.

 

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[snowbank]

I am rethinking our plan and think it might be a solid slowlane route.

The first approach of simple buying and renting out property doesn't have the element of exponential growth.

fast and slow are relative terms.

how fast do you want to make x amount of money.

that will help determine the path.

if you don't enjoy what you are doing and are only doing for the pursuit of wealth, it makes sense to pursue a faster path.

but, if choosing a route where you enjoy it, the length of time needed matters a bit less.

my brother started with one house, the same way you did.

here's how his yearly purchases have looked:

Year One: 1 unit
Year Two: 4 units
Year Three: 12 units
...
Year Fourteen: 487 units

So he's now purchasing more than 1 unit per day.

But it took him over a decade.

Is that slow or fast?

It's all relative.

 

[Antifragile]

real estate where you buy and do something to make it worth more is a fastlane business.

Good luck.

 

[MJ DeMarco]

My name is Charlie, I am located in the midwest of the United States. Recently read the Fastlane Millionaire for the second time, after reading I subtly suggested the book to two family members in hopes they would also appreciate and be accepting of the mindset shift in thinking. So far there has been positive feedback.

My wife and I recently bought a duplex we have fixed up over the last 5 months. We are now looking for a tenant and are located near a large university. Coming from low income childhoods we saw building a real estate portfolio as a route to wealth. Buying duplexes and living in half to qualify for better loans, rinse and repeat. The capital needed for each property investment is substantial and the trajectory to become detached from this money tree will include large sums of capital investment and ultimately a team of property managers. We are still pleased with the choice to do this first investment but after reading Fastlane Millionaire for the second time I am rethinking our plan and think it might be a solid slowlane route.

Real estate is a corner stone need for humans so I feel confident there is potential in this area. The first approach of simple buying and renting out property doesn't have the element of exponential growth. Through this first property there may be an opportunity that becomes more obvious that needs solving through technology like some sort of service to provide to other landlords/renters.

We both work decent 9-5 jobs and have brought this property up to standard in our free time, we are both on board that our initial plan may need some reworking and are optimistic we will find a route to do just that.

Some caveats...

IMO experience, it is a better bet to just focus on a business that can scale quicker than doors. Buy REITS instead which are low hassle, and easily liquidated.

I've owned rental property - it was never worth the hassle or the cash flow, even after selling. NEVER AGAIN.

I also have someone in my family who is about to sell his two duplexes -- they have consumed his time and sanity and aren't worth the cash flow or potential appreciation. He's tired of the BS - and this is a mid-twenty something who should have a ton of energy and tolerance.

Throw in the "eat the rich" mentality that is pervasive nowadays, and I just view RE as terribly risky with little return. (Not talking about apartments, commercial, etc.)

@Rabby just posted his friend's landlord nightmare experience involving deadbeats who don't pay, but destroy the property.

@biophase owned AirBnb's for years. After he sold the properties, he said he would have just been better off buying the SPX index.

There's a few of us just discussing this on the INSIDE.

The return on stress for single family/duplex real estate has largely plummeted.

This might be helpful...

GOLD! Thread 'Beware: The Revenue Razor and Return on Stress...'

Aug 15, 2023

From the Life in Fastlane Newsletter...

Beware of Bold Claims and Stressful Returns...

Ever stumbled upon glittering claims like these?

• I sold $300K of X widgets in 3 weeks; here's my secret...
• My company did $4M last year; here's how you can too...
• Our real estate holdings will earn over $16,000 in rent next month...

If you ever hear or read these grand proclamations, let the suspicion creep over you.

Why?

Because they likely are subject to what I've dubbed, The Revenue Razor.


If "razors"...

• MJ DeMarco
• return on stress revenue razor
• Replies: 12
• Forum: Process and Execution

• 
• 
• 

 

[cshervheim]

Some caveats...

IMO experience, it is a better bet to just focus on a business that can scale quicker than doors. Buy REITS instead which are low hassle, and easily liquidated.

I've owned rental property - it was never worth the hassle or the cash flow, even after selling. NEVER AGAIN.

I also have someone in my family who is about to sell his two duplexes -- they have consumed his time and sanity and aren't worth the cash flow or potential appreciation. He's tired of the BS - and this is a mid-twenty something who should have a ton of energy and tolerance.

Throw in the "eat the rich" mentality that is pervasive nowadays, and I just view RE as terribly risky with little return. (Not talking about apartments, commercial, etc.)

@Rabby just posted his friend's landlord nightmare experience involving deadbeats who don't pay, but destroy the property.

@biophase owned AirBnb's for years. After he sold the properties, he said he would have just been better off buying the SPX index.

There's a few of us just discussing this on the INSIDE.

The return on stress for single family/duplex real estate has largely plummeted.

This might be helpful...

GOLD! Thread 'Beware: The Revenue Razor and Return on Stress...'

Aug 15, 2023

From the Life in Fastlane Newsletter...

Beware of Bold Claims and Stressful Returns...

Ever stumbled upon glittering claims like these?

• I sold $300K of X widgets in 3 weeks; here's my secret...
• My company did $4M last year; here's how you can too...
• Our real estate holdings will earn over $16,000 in rent next month...

If you ever hear or read these grand proclamations, let the suspicion creep over you.

Why?

Because they likely are subject to what I've dubbed, The Revenue Razor.


If "razors"...

• MJ DeMarco
• return on stress revenue razor
• Replies: 12
• Forum: Process and Execution

• 
• 
• 

GOLD! Thread 'Beware: The Revenue Razor and Return on Stress...'

Aug 15, 2023

From the Life in Fastlane Newsletter...

Beware of Bold Claims and Stressful Returns...

Ever stumbled upon glittering claims like these?

• I sold $300K of X widgets in 3 weeks; here's my secret...
• My company did $4M last year; here's how you can too...
• Our real estate holdings will earn over $16,000 in rent next month...

If you ever hear or read these grand proclamations, let the suspicion creep over you.

Why?

Because they likely are subject to what I've dubbed, The Revenue Razor.


If "razors"...

• MJ DeMarco
• return on stress revenue razor
• Replies: 12
• Forum: Process and Execution

• 
• 
• 

 

[cshervheim]

fast and slow are relative terms.

how fast do you want to make x amount of money.

that will help determine the path.

if you don't enjoy what you are doing and are only doing for the pursuit of wealth, it makes sense to pursue a faster path.

but, if choosing a route where you enjoy it, the length of time needed matters a bit less.

my brother started with one house, the same way you did.

here's how his yearly purchases have looked:

Year One: 1 unit
Year Two: 4 units
Year Three: 12 units
...
Year Fourteen: 487 units

So he's now purchasing more than 1 unit per day.

But it took him over a decade.

Is that slow or fast?

It's all relative.

Does your brother run a property management company at this point in his career to manage 487 units?

 

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[MJ DeMarco]

http://Thank you, the reference to ...s that provide high value and have high need.

Not sure if this was intended, but you just quoted me and the link, but did not reply.

 

[cshervheim]

Not sure if this was intended, but you just quoted me and the link, but did not reply.

My mistake. I read the post you suggested on the balance between stress/income earned. My wife and I are still in a holding formation, I started reading your book Unscripted to continue the momentum with this new line of thinking and mindset.

Initially after reading Fastlane Millionaire my outlook was that I needed to find something that would grow in 6-18 months. Even something that has potential to grow quickly may take several years to grow strong roots. I now see the main principle being long term consistency to stay the course. I see the value in a forum like I am interacting on now to stay connected with others on a similar path.

In a world of evolving AI tech I gravitate to something in that world but do not have the skills yet. I feel a little lost but know reading books has value so that is my reaction.

I just came across the part in the book for Unscripted talking about entrepenuaers vs wantrepenuaers and that hit hard. Pretty similar to the article you suggested last week and the revenue razor in the way one has true value and income while the other is a front.

I think I need to stay patient during this phase and stay grounded, two weeks is a short amount of time to change a mindset and plan a new strategy. I have started looking for problems to solve in my life or pain points that others may also experience. I went to the dentist last week and asked if the dental hygienist's shoulders and neck after a day of work every gave them issues, I asked if they had chairs to rest their arms while they work and they said no. Then I thought through how I could solve this problem, I didn't like it because it would involve manufacturing, distributing, and physical products. Slow changes will build over time.

 

[iamtjking]

Welcome Charlie. Congrats on acquiring your first property!

My wife and I recently bought a duplex we have fixed up over the last 5 months.

Is it cashflowing? Do you have handyman skills? Perhaps, that could be a business opportunity for you.

Buying duplexes and living in half to qualify for better loans, rinse and repeat. The capital needed for each property investment is substantial and the trajectory to become detached from this money tree will include large sums of capital investment and ultimately a team of property managers

House hacking can be a great way to lower your housing payment. A duplex near a university is a plus, especially if you can get faculty/staff or graduate students to rent from you.

When i first got into RE investing i was told Duplex/Multifamily was the only way to go in order to qualify for financing. Have you ever looked into just buying solid single-family homes in good areas and holding long-term with quality tenants?

Single-family homes tend to attract tenants who want stability — not neighbors, not turnover — just a quiet spot they can treat like their own for years.