would like a referal on a mentor or course that works fo or this economyht now

Looking for suggestions from anyone who has information on a good mentor or real estate investing course to get started with and limit my learning curve.

Thanks, Matt

[QUOTE=mattcorp;883248]Looking for suggestions from anyone who has information on a good mentor or real estate investing course to get started with and limit my learning curve.

Thanks, Matt[/QUOTE]

Matt,

Do not kid yourself. Today’s market is different but most of the really important things about real estate have stayed the same. I would say the dumb money is out of the game so that means people who really did not know what they are doing are no longer active.

If all you learn is what will work in today’s market, what will you do when the market changes again?

There are strategies that might be better in today’s market. An obvious comment is anything that helps avoid going to a conventional lender.

Do you have any specific background that is helpful when dealing with real estate? Are you poor or wealthy as that will impact what you need to focus on? Are you good with people so building relationships with possible partners is realistic?

What do you already know? Have you ever owned a home so therefore understand the basics of a sale? If you never owned a place, do you have much experience as a tenant?

Do you have a lot of time on your hands or a pretty full schedule right now? What is your local housing market like as a strategy that works in one place might be far from optimal in another market.

Are you looking for a mentor or an accountability partner. Most mentors and mentor systems are really just accountability partners in disguise and you shouldn’t have to pay someone to just keep you on track.

Today’s economy is very different than it was even three years ago and if my hunch is right the next 3 years will be even more fluid. No mentor can tell you what’s right for you in your own market (unless they are in the same market with you). And you can get accountability partners here and really solid advice here as well.

So, unless you have a specific reason for wanting a mentor, I’d say you best move forward is to move forward, when you get stuck or have a question ask for advice on here and keep learning and growing. The best way to learn is through experience.

I hope this helps.

[QUOTE=John_Corey;883270]Do you kid yourself. Today’s market is different but most of the really important things about real estate have stayed the same. I would say the dumb money is out of the game so that means people who really did not know what they are doing are no longer active.[/QUOTE]

The dumb money is back. The fools will be arriving soon. We have already started liquidating…

[QUOTE=AmotoXracer;883363]The dumb money is back. The fools will be arriving soon. We have already started liquidating…[/QUOTE]

What market are you in? What sort of portfolio are you liquidating?

[QUOTE=John_Corey;883390]What market are you in? What sort of portfolio are you liquidating?[/QUOTE]

Multifamily and a few SFH
our only remaining inventory is 135 units in Mi…

[QUOTE=AmotoXracer;883423]Multifamily and a few SFH
our only remaining inventory is 135 units in Mi…[/QUOTE]

So you are saying the dumb money is investing in MI?

[QUOTE=John_Corey;883449]So you are saying the dumb money is investing in MI?[/QUOTE]

Kind of but not exactly.
What im really saying is that the people that should of been accumulating property from 08 through the end of 10; are attempting to start now, and some of us who were buying in 08 -10 are now selling. Its kind of like waiting for a stock to get close to its high before you buy it, instead of when its low.
Soon the fools will be back (who will get wiped out) buying at a multi year highs. Especially in the Multi family market.
Thats what Im saying.

Matt,
find a local REI club and join. Meet other investors there and talk and pick their brain. Invite someone who does what you’d like to do to lunch or dinner and ask questions.

99% of people who’d like to get into real estate investing never end up doing anything. The hurdle from theory to actually doing something is huge and insurmountable for most.

Your friends and family will usually tell you that you can’t do it, so surrounding yourself with people that actually do will help your mindset.

Many of us who’ve been in the trenches for years have done it without official mentoring programs.

Michaela

[QUOTE=AmotoXracer;883454]Kind of but not exactly.
What im really saying is that the people that should of been accumulating property from 08 through the end of 10; are attempting to start now, and some of us who were buying in 08 -10 are now selling. [/QUOTE]

I think you’re selling too soon. On the supply side, stats support the scenario that investor interest in multi-family has just begun, and has a lot of room to run. Multi-family starts (5+ units) just came above 100,000 units (SAAR) in January, completions lag by 9-12 months. Reversion to the mean of 300,000 starts per year will take several years to achieve.

In the demand side, demographic projections indicate the 5mm+ new renters in the market will continue to be fed by the retiring baby boomers and the echo boom, plus immigration. Add to that the fact that home ownership rates will likely fall below 60% for the first time in 50 years.

In short, demand is off the charts and supply is going to be very slow to catch up.

Being a buyer during '08-'10 was a contrarian move and very smart, but you’re selling on the first glimmer of the uptick. To replace those properties you’ll be paying more… unless you made enough to take a year or two off, in which case, congratulations on a great play!

For an old dirt merchant like me, I’m going to ride the next 3-4 years up, slowly convert half of my portfolio to passive ownership, and I’ll meet you on an island in the Caribbean. :wink:

ray

Host, CRE Online Commercial Forum

I agree that there might be another 20% more in mulit family, but the big move has occured. SFH has more to go, but its going to happen to slowly.
Over the years I have learned that leaving money on the table for the next guy, pretty much gurantees a sale where the seller dosent have to put up with a bunch of buyer/mtg broker/atty bs. (My temperment requires low frustration transactions).
Besides all that, when you get right down to it, my job (everyones job) is to buy at the right price, because if you get that wrong, nothing can save you.

[QUOTE=AmotoXracer;883454]Kind of but not exactly.
What im really saying is that the people that should of been accumulating property from 08 through the end of 10; are attempting to start now, and some of us who were buying in 08 -10 are now selling. Its kind of like waiting for a stock to get close to its high before you buy it, instead of when its low.
Soon the fools will be back (who will get wiped out) buying at a multi year highs. Especially in the Multi family market.
Thats what Im saying.[/QUOTE]

I would say you are using a trading mentality in an asset class is poorly aligned with in and out movements.

Unlike most shares there are many ways to extract value from a MFR property or portfolio without selling. Even in the stock market Buffett feels selling a performing asset is a bad idea give the transaction costs plus the tax impact.

I am not saying you should never sell. I am saying buying low and selling higher is sub-optimal as a focused strategy in real estate.

At the end of the day, everyone can do what they want and if they feel they are winning they likely are from their point of view.

[QUOTE=AmotoXracer;883592]Over the years I have learned that leaving money on the table for the next guy, pretty much gurantees a sale where the seller dosent have to put up with a bunch of buyer/mtg broker/atty bs. (My temperment requires low frustration transactions).[/QUOTE]

I agree with the idea that there has to be something left in it for the next owner. Terry V used to make that point during the Lenders Workshop.

[QUOTE=AmotoXracer;883592]Besides all that, when you get right down to it, my job (everyones job) is to buy at the right price, because if you get that wrong, nothing can save you.[/QUOTE]

This is where I think the trading mentality is missing the elephant in the room. Real estate can produce a lot of value even if you continue to hold. Unless you do not care about the re-investment returns when you sell, there is no need to rush for the exit when prices rise. Maybe your mentality does not suit being a landlord or a long term investor where you produce returns from operations rather than trading. If that is the case, the exit could be right for you. Or it could mean you need an operational partner who can sort the things that do not play to your temperament. Just a guess on the last bit given your prior comments in the thread.

[QUOTE=John_Corey;883596]I would say you are using a trading mentality in an asset class is poorly aligned with in and out movements.[/QUOTE]

LOL

You might say that, but if you didnt retire from full time work at age 32 and have a present net worth greater than 1 million (USD); well then you could never be me.

[QUOTE=Michaela-ATL;883571]Matt,
find a local REI club and join. Meet other investors there and talk and pick their brain. Invite someone who does what you’d like to do to lunch or dinner and ask questions.

99% of people who’d like to get into real estate investing never end up doing anything. The hurdle from theory to actually doing something is huge and insurmountable for most.

Your friends and family will usually tell you that you can’t do it, so surrounding yourself with people that actually do will help your mindset.

Many of us who’ve been in the trenches for years have done it without official mentoring programs.

Michaela[/QUOTE]

Nicely said.

Do watch out for the dream stealers.

[QUOTE=AmotoXracer;883598]LOL

You might say that, but if you didnt retire from full time work at age 32 and have a present net worth greater than 1 million (USD); well then you could never be me.[/QUOTE]

Wanting to be you and being you are not relevant. Further, I am told that size does not matter. LOL

We are talking about strategies. Your success is real to you and pretty good at that. I have seen people who are more successful and I have seen people more successful still be wrong. This is not a race so there is no finish line with a declared winner. For all we know your past success is setting you up for a major flameout.

Being only 32 does start to explain your viewpoint. That said, a person also has to pick a strategy that suits their abilities or avoids their faults. You said you are not suited to certain things.

We could compare our pasts and maybe even enjoy the conversation. It would not change much so how about we go back to the topic at hand?

If you want to stick with past success, I know some mortgage banks and investment banks who had a winning strategy that worked really well for a period of time. Their net worth and bank balances sheets had many orders of magnitude more zeros than your net worth if size is important. I worked at the firms or know friends who did. The largest lender to the residential sector in the UK noted that I understood better than he did the real operating costs for the portfolio he was sitting on. The UK government bailed that lender out prior to the conversation. That was a £26,000,000,000 loan book and no significant MFR in the portfolio at the time.

Another friend ran the largest private bank in the world for a period. The trading floor I delivered systems to traded $1 billion a day. Zeros do not impress me. Having a net worth of $1 million by the time you are 32 is rounding error in The City of London or on Wall Street. See the movie reference below for an explanation.

I could even tell you stories about having Steve Jobs as a direct boss or how LinkedIn was created by a friend. I started investing in real estate while in Silicon Valley at the start of what seems to be the dawn of the Internet.

None of the above would change the point that you are advocating using market timing with an asset class that has high transaction costs. An asset class that does not have to be bought and sold to maximise the profits. We are talking about the largest asset class in the world so the results of one investor will not change the fundamentals.

Your strategy has worked for you for the period you have been following it. That is a fact.

As general advice to everyone who might read this thread, there are lots of ways that an alternative would be better for them or just better as an absolute. As absolutes are hard to prove how about we agree that there is no one answer no matter how big your net worth or how young you are?

BTW - A fun movie that makes the point that some of the time people get it wrong is Margin Call. About a 30 day hold was all they focused on and when it went wrong, there was a big hole in the world wide balance sheet. Watch the scene where the mid-level Mortgage Backed Securities investment banker explains how $2,000,000 a year cash bonus disappears pretty quickly. The guy does not even spend half of it yet it is gone in a flash.

@ J Cory

So i read your unbelieveably long (record setting) post and now im guessing you missed the bottom.

[QUOTE=John_Corey;883596]I would say you are using a trading mentality in an asset class is poorly aligned with in and out movements.

Unlike more shares there are many ways to extract value from a MFR property or portfolio without selling. Even in the stock market Buffett feels selling a performing asset is a bad idea give the transaction costs plus the tax impact.[/QUOTE]

Well said John.

This is my last post in this thread. There is to much irony for me to continue.

Is holding from 08 through 012 trading ? Maybe, and maybe not.
Either way, at this point in multi fam, holding on in an effort to call the top of the market is somthing only a trader would do, and that seems to be what your advocating for (you just dont know it). Curiously enough, this is exactly how people were talking in 2006.

You folks should ask yourselves - What do you think happens when everyone agrees that its time to sell ?

When you can answer that, you will understand why I am saying the unsophisticated (dumb) money is back in RE and that is (and always will be) the best time to sell.

[QUOTE=AmotoXracer;883623]This is my last post in this thread. There is to much irony for me to continue.[/QUOTE]

If you could be so kind, it might be worth continuing a bit given what you say below.

[QUOTE=AmotoXracer;883623]Is holding from 08 through 012 trading ? Maybe, and maybe not.[/QUOTE]

Holding for 4 years does not sound like short term trading.

[QUOTE=AmotoXracer;883623]Either way, at this point in multi fam, holding on in an effort to call the top of the market is somthing only a trader would do, and that seems to be what your advocating for (you just dont know it). Curiously enough, this is exactly how people were talking in 2006. [/QUOTE]

This is where I might not have been clear. I am not saying to hold until the top of the market. I am not interested in tops or bottoms. Tops and bottoms are for traders.

There is no need to sell is my point. You can ride it up and down more than once and come way out ahead.

It would be market timing if you try to find tops and bottoms. Tops and bottoms matter a fair amount if all you can do to produce a profit is buy low / sell high. If you are creating income, equity and other benefits while never selling the asset then it is not trading. You can extract capital through the prudent use of debt.

Somewhat similar to buying a machine that produces the product you sell. You buy a property and rent it out, improve it, etc. Selling is very much optional.

[QUOTE=AmotoXracer;883623]You folks should ask yourselves - What do you think happens when everyone agrees that its time to sell ?[/QUOTE]

This is actually a flaw in your logic.

  1. Everyone does not sell. Statistically, the majority just continues to hold. Only a marginal amount of owners will sell even in a credit crunch.

Yes, the value is determined by the last few sales. If I do not sell I am not sure that I care all that much what the property is valued at. Certainly not very interested if I am not trying to sell or refinance and I have no loan convents that require a minimum value to secure the loan.

  1. The asset is producing an income stream. It can continue to do so unless something happened in the local market to the demand for rental housing.

Similar to when a company continues to operate even if the share price goes up or down 10%, 20%, etc. The ability of the company to make a profit is not driven by the share price so the owners might be buying and selling with little change in the customer’s behaviour.

The reverse is not so true. The company’s ability to generate a profit will impact the share price; just not so much the reverse.

[QUOTE=AmotoXracer;883623]When you can answer that, you will understand why I am saying the unsophisticated (dumb) money is back in RE and that is (and always will be) the best time to sell.[/QUOTE]

I think I have now answered the question. I also hope I have raised some useful counter points. I do not see any proof based on your explanation that dumb money is back in the market. Maybe it is; I just do not see how your evidence proves it is. We could agree to disagree until there is clear evidence presented.

You could have discussed yield given commercial valuations are tied to NOI and the capitalisation rate. Yields can be a good indicator of sentiment plus the macro interest rate environment.

If we look at yields and we agree that yield compression past a certain point indicates returns that are just too low for the risk required, that would be a sign that buying is not a great idea. New buyers could be ‘dumb money’ in that they are over paying on a risk return basis. Maybe it is also a sign that sellers can achieve a premium.

Even if we were to agree with the comments I just made concerning yield, most owners will continue to hold plus they will continue to focus on the operating profits. Asse value is a line on the balance sheet and not much of a signal. The dumb buyers might be over paying yet the historic owners did not over pay and most continue to hold.

Conclusion? If the yields are good and there is no forced selling then even someone coming in today could operate a profitable rental business for decades. You said much earlier that your temperament is not really suited to such a strategy.

Maybe the difference in our points of view is you are buying and selling assets based on momentum and I am focusing on the operating performance. Trading shares in a company vs. operating the company might be the best analogy.