Here’s a quick review on a book that had great impact on me.
The Basics
- Category: Investing
- Originally Published: 2023
- Pages: 376
Book Summary / What This Book Is About
This book is a how-to in real estate investing, written for the investor whose end goal is not necessarily building the biggest real estate empire one can imagine, but more for someone who wants to have a good life through financial freedom. Whereas other books may talk about maximizing the number of units, doors, properties, or revenue, this one is about maximizing your life through just the right amount of real estate. Chad “Coach” Carson talks about three stages of real estate – starter, builder, and ender – and your plans, goals, thoughts, and actions are all different in each phase. For example, in the starter phase, you may be thinking about flips and house hacking, whereas in the ender phase, you may be thinking about paying off your loans and maximizing cashflow.
Main Takeaway / The First Thing I Think About When I Think About This Book
There was a lot of good information in this book, but the following two concepts jumped out at me the most: One; always find a deal and Two; start with four units.
The first concept is simple enough to understand (who doesn’t want to find a good deal?) but often hard to execute on. This got me thinking about a strategy for finding the best deals. I need to find properties before they show up on Zillow or LoopNet. Also, part of finding a good deal is deciding which type of property you want and where. What class (in real estate, there are four classes of property – A,B,C, and D)? I need to start working on a strategy for finding good deals.
Regarding concept two, Coach Carson says a good starter phase goal is to get four units. Why four? Because that will give you a good idea of what it takes to be a landlord without getting overwhelmed. I already have one rental unit so my next mid-range goal is to get three more, then reassess how many more I want, if any. Even though I look more like a starter with only one unit, I’m thinking more like an ender, because my goal is to maximize cashflow. I’m following the Dave Ramsey plan with investment properties, which is to put real estate proceeds into the market (stocks and mutual funds) and when they grow big enough to buy a property, sell the funds and buy a property in full, cash, without a loan. This plan is not for everyone, but it’s good for me because I own a business and I don’t need to take my focus away from it with the rapid accumulation of real estate and the risks associated with it, particularly debt. Slow and steady – maximizing cash flow and minimizing risk – is good for me.
Final Thoughts
What I love about this book is that it got me excited for the first time in a long time about buying real estate. I’ve always loved real estate, and as mentioned, have a little bit now that has grown in value and produces great cash flow for a single family dwelling. But I really haven’t put any serious thought into real estate, let along concrete plans on how and when I want to move forward with it. This book gets me interested and developing plans, and will be a great reference for when I inevitably get stuck with technical questions when I do start looking to buy. Ultimately, I would like to have investment income totally fund my life, replacing the salary I pay myself through my business. Of that investment income, real estate will undoubtedly be the biggest part of creating that stream of income because it produces more cashflow than any other investment I’m aware of. Lastly, I’ve always been decent at long-term envisioning, and I’m great with day-to-day activities and stay on top of things, but mid-range plans? I’ve never been that good at them. Mid-range planning is an area I’m working on and through the concept of “start with four” this book has helped me big time.
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