The housing market may seem erratic and unpredictable, but the fact is, it always conforms to the same pattern of housing cycles that we’ve been seeing for almost 200 years. Even today, every housing cycle is comprised of four phases: recovery, expansion, hyper-supply, and recession. The duration of each phase of the housing cycle is…...
One of the best things about my job is that I’m constantly meeting new people. Frequently, I’ll meet people who haven’t bought their first rental property yet. Typically, they’ll introduce themselves and then follow up with a comment like, “I’m not really an investor, but…” And then we’ll proceed to have a conversation where […]
A lot of you have asked what resources and market research tools Ken uses in order to stay current, so here they are. Don’t get discouraged if you don’t understand everything you read. Education is a process that rewards persistence. Ken’s Favorite Resources Yield Pro Yield Pro is a national magazine with a focus on […]
If you’ve tried to buy a house recently, you know how stiff the competition is to get your foot in the door. With bidding wars, all cash offers, and homes going into escrow almost the instant that a “for sale” sign gets placed on the front lawn, buyers have been acting with lightning speed. In […]
Are we heading into a depression? Are we heading into another depression like the 2008 housing crash? Join Ken McElroy and Danille in a discussion about where the future of the US economy is heading.
The Value of Debt The personal finance community has very different views of debt. Some believe debt is irresponsible and should be avoided. Others believe that debt is a powerful wealth-building tool that should be leveraged. Personally, I love debt, but not all debt. Certain debt. In my opinion, you can’t love or hate debt […]
How to House Hack Your Way to Real Estate Success If you are someone who feels like owning real estate is out of reach, then you need to consider house hacking. House hacking is a great way to build a real estate portfolio. Not only do you get homeowner interest rates, but you also can […]
The home buying process can be an exciting time, but there are some important things to know, like what documents you’ll need to provide, who pays for which closing costs, and what’s involved in your due diligence. So let’s test your knowledge on the buying process.
College towns offer excellent investment opportunities, but a lot of investors are apprehensive about the thought of college students as tenants. While it’s true that college students aren’t necessarily the tidiest demographic, the fear of out-of-control college students isn’t a reason to overlook an opportunity for a cash-flowing investment.
If you have turned on a television in the last two months you have probably heard the word inflation being mentioned. Inflation is basically a tax on the poor. These small but steady increases are making it harder for those that live paycheck to paycheck to get by. Yet, there is a way to make […]
“Be Content with What You Have, but Never Who You Are” It is that time of the year, the holidays. During this time specifically, I think we go through the motions and state how grateful or blessed we are for our friends, family, and our prosperity. Yet, I think a lot of us throw the […]
Qualifying as a Real Estate Professional By default, as a real estate investor, you’re treated as a Passive Investor, which means that your deductions related to real estate may be limited. If you can, you want to get into the Real Estate Professional category so you can maximize your deductions when it comes to tax […]
Whether it’s your first deal or your hundredth, there are some things that you need to avoid when syndicating for your investments. These mistakes can range from being a major headache to a legal issue, so it’s important to keep these mistakes in mind and avoid them at all costs.
Did you know that one of the benefits of owning real estate is that some of the income you generate can be taxed at a lower rate? This is called a Capital Gains Tax, and it applies to assets that you hold for more than one year. Currently, the capital gains rate is about 20% depending on the scenario.
There are four major ways that you can benefit from these rates.
When syndicating for a deal, you have three options: register the deal with the SEC, find exemptions for the deal, or it’s illegal. 506B and 506C are the two most common exemptions for syndications, so let’s take a deep dive into the differences between the two and figure out which exemption is the best for […]
La persona promedio obtiene su flujo de efectivo de un trabajo de nueve a cinco. Este escenario es exactamente lo contrario de ser financieramente libre, porque el flujo de efectivo proviene de depender de un trabajo al que tiene que ir todos los días para recibir un pago. La libertad financiera se logra mediante la […]
How are people investing in real estate without owning any property? It’s through Real Estate Investment Trusts (REITs). These are companies that own, operate, or finance income-generating real estate. People who invest in REITs can reap the benefits of inflation and increasing rents, but there are a few things you should know about REITs to maximize your investment.
With inflation and the cost of rent continually going up, you hear a lot of politicians today talk about rent control. Rent control limits the amount you can raise the rent on your tenants annually. When you get a new tenant it typically resets and you can once again charge market rent. Rent control sounds […]
In evaluating new acquisitions and ground-up construction deals, my team and I consider what types of returns we can expect and generally frame them in terms of 4 types, which I call “The ABCD Matrix.” Enter your information below to understand what The ABCD Matrix is and how it can help you on your investing journey.
Compromise is important. To work with a team or within a company requires compromise. In fact, that is why our culture at MC Companies is so highly rated. Ross and I are willing to work with our employees to get things done. Even in my personal life with my wife and kids, I am constantly compromising […]
These six types of real estate markets are what I call “sleeper” real estate. We spend a lot of time focused on real estate as it pertains to housing. While that’s certainly a huge part of the real estate market, you may not know there are a lot of ways to invest in real estate […]
Are you a winner, a worker, or a victim?
That all depends on your mindset. In this download, I break down the “be, do, have” concepts and help you find the path to success.
When new investors get started, they want to do everything themselves. They are either concerned about the cost or they feel they are not at the point where they need a team. You need a team from the beginning. It is the first step.
Do you ever wonder why the education system doesn’t teach you how money works? Most people assume the system just needs to be updated to include this part of the curriculum, but the truth is they don’t teach you because they don’t want you to know. Let me break it down, the general education system […]
The housing market may seem unpredictable, but the fact is, housing cycles always conform to the same patterns we’ve been seeing for almost 200 years. Each housing cycle is comprised of four phases: recovery, expansion, hyper-supply, and recession. For real estate investors, knowing how to respond to each of these phases will empower you to […]
I celebrated my birthday this past weekend with my family and close friends. In my downtime, I took some time to reflect on the year and put together some real estate and life lessons I have learned throughout my younger and now more wiser years. I hope you enjoy my top ten and make sure […]
Let me tell you a story. One evening I was looking through viewer emails and one particular email caught my eye. It wasn’t someone looking for advice. It wasn’t someone who wanted to invest with me. It was a 13-year old kid named Steven. He wrote me a lengthy story about how he wasn’t doing […]
How to Invest Your Money in Your 20s (with Money Honey Rachel) How DO you get started with real estate in your 20s? Do you REALLY need lots of money to get started? Join Ken McElroy and Rachel Richards, author of Money Honey, in a discussion about how to be a real estate investor your […]
If you’re not sure where your money is going, it’s time for a budget. A defined plan can help give you more control over how much and when to spend. With a budget, you can not only keep track of where your money is going but also have more control over the process. Without a […]
As many of you know I spoke this weekend in Miami for the Rebel Capitalist event hosted by George Gammon. When deciding what to speak about I took into account George’s saying of “End the Fed.” Sure, that would be great, but it’s not going to happen anytime soon. However, what if instead of ending […]
I was just asked at a charity event the other night if I was still running MC Companies. I replied, “Yes I am.” while laughing. I will tell you, I am pretty busy running MC Companies while also launching the learning platform KenMcElroy.com. So why did I start this learning platform? That is a great question […]
Hidden Forces in the Housing Market… As many of you are starting to realize (myself included) this isn’t your typical housing market bubble and crash. We have a loss of jobs, many people in forbearance, and many tenants and landlords behind on payments. Yet, the housing market is on fire. Why is this? Because the […]
If you’ve been considering an investment in real estate or buying a home, you may have found yourself looking at short sale listings. But what exactly is a short sale? A short sale occurs when a lender allows a homeowner to sell their property for less than they owed on the existing mortgage. This process […]
There have been a lot of tax law changes from the new administration, so how you normally structure your tax write offs may not be the best way to do them this calendar year. Today, I am joined by Tom Wheelwright who is a very knowledgeable CPA and we are going to discuss all things […]
While many of the events of last year were unpredictable and unprecedented, we’re now at the time of year when we need to address a very predictable and recurring event: paying your taxes. If you’re a real estate investor, there are numerous deductions you can claim, including some you may not be aware of.
Before I get into the particular deductions, my number one piece of advice is to hire an experienced CPA. While it may be tempting to save some money by doing your own taxes, real estate tax law is extraordinarily complex and you could easily wind up paying more than necessary. It will be well worth your time and money to hire a CPA to make sure you follow the best approaches for your deductions and you take advantage of all of them.
Finding the Right Short Sale Property
If you’ve been considering an investment in real estate or buying a home, you may have found yourself looking at short sale listings. But what exactly is a short sale? A short sale occurs when a lender allows a homeowner to sell their property for less than they owed on the existing mortgage. This process allows the lender and the homeowner to avoid the lengthy and costly foreclosure process. Unlike regular home sales, in a short sale, the lender is actually the one approving the sale
Primary markets as most of you know are suffering. What we are seeing is a lot of secondary markets by the big cities are heating up as the cities cool down. For example, as Washington DC cools, Virginia Beach heats up. Same with San Francisco -> Sacramento and Los Angelis -> Riverside. The truth is, these more expensive cities were already at their tipping point prepandemic. The pandemic only accelerated it.
Real estate investing is going to get a bit trickier and take it from me you want to have a true “expert” leading you in your journey. I wanted to share with you some common mistakes I see investors making when they first start out in real estate.
I see this misconception happen all of the time. “Well my realtor says ____________ about the market.” That blank is always something like “Buy now or you’ll miss out” or “The market won’t go down anytime soon” or my favorite “This isn’t 2008.” Yet, guess what? Realtor’s were saying that in 2008 as well ha.
People often times miss this very important question. They try and measure the cashflow of the future value, or they say they don’t mind feeding it some money each month. To be direct, it is only a good investment if it cashflows based on the rents and expenses of today, not the future rents you think you will get five years from now. Cashflow is the most important thing when deciding on a rental property.
I am going to show you how to look at a Zillow listing and decide if the property is cashflow positive or negative. Obviously, I want you to dig into these numbers and verify the rent and expense numbers, but start with just the basic calculation. If the numbers don’t work on the initial calculation, then it is not worth your time. If the numbers do work, it is time to move into due diligence and verify the rental and expense amounts. FYI in this hot market, most listing don’t work. That is why it is up to you to always look at the new listings and run the numbers daily.
Return to Orchard Canyon follows three family members who are doing their best with what life has handed them. David, one of the protagonists, has recently lost his “secure” formerly lucrative day job when he brings his teenaged daughter to visit his elderly father in David’s hometown of Sedona, Arizona. David is so embarrassed by his job loss that he asks his daughter not to tell his father. Despite David’s worries at the outset, Return to Orchard Canyon is ultimately about transforming your path and using life’s setbacks to discover what you truly want to do
A correction is coming to the real estate market and I expect to see it early next year. Each downturn is very similar to the next. We have high unemployment, and housing prices that are extremely inflated. Yet, people keep asking me, “how can you say it’s going to crash when prices are skyrocketing? If I keep waiting, I’m going to miss out on the buying opportunity!” So let me put a few things into perspective for you. This is a supply and demand issue. That is what inflates and deflates prices: inventory versus demand for housing
If you find yourself saying or thinking, “it won’t happen here,” I need to give you a reality check. Denial is not an investment tool. In fact, you can’t be a successful investor if you don’t understand market cycles. When a correction occurs, it generally happens everywhere in the country. Of course, some areas are affected more than others, but every city and every state is eventually affected.
Cash is king moving forward. Let me repeat cash is going to be king in the next 12 months. Here is why. Banks want to lend, it is in their nature. The problem is if people are out of work or just starting a new job, or are behind on bills the bank cannot lend to them.
I will tell you that affordable housing will become more and more of a need in the United States over time and this is definitely something you should understand and look into. That is potential here from owning a park to possibly even converting a mobile home into a rental.
If you are interested in obtaining a rental, then take the time to read my book “The ABC’s of buying Rental Property.” The next couple of years you may have the biggest buying opportunity you will see in your lifetime, so you need to be prepared. I wrote this book to prepare you with all of the in-formation you need to know when purchasing your first rental. I am going to help to prevent you from making the same mistakes new investors make and to maximize your investment.
A Vacant Unit is Better than the Wrong Tenant I see this all of the time. Tenant’s not paying their landlords and the landlords having to jump through the hoops of evicting them. Normally, when I get into the conversation with people I find they needed to fill their vacant unit so they lowered their […]
Many people see investing in real estate as a way to generate cash flow, build up a nest egg and have tenants pay your mortgage for you. That’s a great strategy, but there’s a technique to it. It isn’t as easy as simply buying a property and renting it. Uneducated investing is how you get […]
The time is finally here. You’ve done the hard work of getting your investment property ready for tenants. The people looking at it are oohing and aahing at the upgrades you’ve made and they all seem friendly. When one of them wants to move in, you have a good feeling about them. In fact, you’re […]