How should we be engaging in real estate in the new global and digital era?
BY SENSEI GILLILAND
What is the best way to invest in real estate in the new era we are in now? How might new political and economic factors impact our incomes, wealth, lifestyles, and ability to invest? How can we navigate the new landscape successfully regardless of age, current finances, and where we are on the map?
The Trump Card, The Data & The Digital Life
The U.S. presidential election is finally behind us. Love the result, or not, at least it has eliminated much of the uncertainty which has kept investors and consumers on the sidelines for the last year. While it’s pretty clear that not everyone is excited about the new choice of president, most have to agree that at least Trump is expected to be good for real estate. Exactly how the new White House administration will impact the American and international economy will depend a lot on if people are able to put their differences down, and get on with embracing the opportunities, as well as how much of what Trump campaigned on is actually realized. So, while we can reasonably expect four good years of real estate growth and perhaps lower taxes as well, there is still some uncertainty.
Millions of individuals are also facing a lot of uncertainty in their personal finances and incomes too. The horizon might be a little brighter today for those getting into real estate, but many jobs aren’t going to be around in the next 10 or 20 years. One Oxford study predicts 80% of current jobs will become redundant thanks to robots and digital roles in the years ahead.
A White House report covered by the Huffington Post says there is an even higher likelihood that your career or job role will be extinct in the next few years if you make $20 an hour or less. There is an over 40% chance your job will be replaced by technology if you earn $40 an hour. The big concern is that at some point the current middle and lower class just won’t be able to catch up. Via Inc., Grant Cardone argues that being a millionaire is the new middle class. That leaves a lot of catching up to do for millions of Americans.
Education and training is recognized as key to helping individuals change this dynamic and stay ahead of the curve. Yet, what you learn makes all the difference.
I guess the only things we do know for sure right now is that both millennials and older generations facing retirement are struggling. 95% of Gen X and Boomers are not financially prepared or on track for retirement. Even millennials coming out of college are getting started with a serious handicap.
Harvard data shows over 40% of college students having student loan debt. 57% say it is a “major problem for them.” According to a Forbes survey over 30% of college grads say they wouldn’t have gone to college if they knew how much it was really going to cost. As of 2016 43% of student loan borrowers weren’t paying their loans.
What we have is an intense and urgent need for individuals of all ages to learn new skills that will help them financially, and real estate is clearly one of the only sectors in which most can really be confident in delivering on that.
A or B?
While there are some individuals and couples with high paying jobs, and some form of reasonable nest egg, the Federal Reserve reveals that the average working age couple in America only has $5,000 saved for retirement. Market Watch suggests at even 10x that most won’t financially survive their first big medical bill. And at an average of just over $12,000 a year, don’t expect Social Security to go very far either.
So what do you do? How do you get started investing in real estate without a large amount of capital?
There are a number of options out there. But to make it really simple; there are two main paths available to everyone from millennials to boomers.
A. Real Estate Wholesaling
Real estate wholesaling is all about getting in, getting out, and getting paid. It can help you generate cash quickly, and in lump sums. It is more on an active form of investment, yet it completely scalable as a business model. Some have even mastered doing it virtually using new digital tools.
If you have some time, but are light on capital and credit, this can be a great choice. It’s even great if you are bearish on the future of the economy and real estate market. Once you’ve made some money in wholesaling you can just grow what you’ve built, or start adding in other strategies too.
B. Partner Up
Wholesaling might not be for everyone. It is simple, but some people just prefer more passive investments. Maybe you’ve got a great job, are still in college, are already retired, or are working on a nonprofit cause you are really passionate about, and just don’t have time to be out there searching for deals, fixing them up, and flipping them. Or perhaps you just want complete time and location freedom while money works for you. If that sounds like your deal then partnering up is probably for you. You can partner up with others who will do all the work of finding properties, making offers, rehabbing, placing tenants, and property management, and just get a healthy return on your money.
You can do this by teaming up with your friends and family, finding a mentor, going in on a joint venture with other investors just like you, or putting your money to work in private lending. There are lots of opportunities here, and some in which you can get started with just $10,000 or less.
7 Steps to Success
I know it sounds easy when laid out in a magazine like this. Then it can be easy to get distracted, and if you want them there are endless excuses not to take the action to get started. So we’ve just done something new at Black Belt Investors to pave the way to success for you.
Aside from just unveiling our newly redesigned website at BlackBeltInvestors.com, we’ve launched a power-packed online training center, and the 7 Steps to Success program. The Dojo is our online training center which offers access to constantly updated training materials for wholesaling, building a business, and creative deal structure.
Seven Steps is our newly designed path which streamlines the way for investors to get started, and to grow from wherever they are now, to where they want to go. It’s highly focused and customizable so that you can hit your goals and breakthrough them fast. As a special bonus to you reading this you can also hop on the website and download a free copy of my latest book Remote Rehabs.
About The Author:
Sensei Gilliland is celebrating 21 years as the founder of real estate education, consulting, and investment firm Black Belt Investors. A martial arts champion and instructor, entrepreneur behind multiple national ventures, in demand speaker, coach, and recognized as a generous community leader, Sensei brings a lot to the table for both new and veteran real estate investors and business owners.