Business
In part 1 of my conversation with Michael Jake, he laid on me a lot of the mistakes that he made through the last recession. If you want to know how to navigate through this next recession, be sure and check out that podcast. Part 2 is all of his advice for newer real estate investors who are learning the ropes. Michael’s been rubbing elbows with real estate legends for years, and he drops names and resources like crazy, so if you’re ready to take your real estate education to the next level, listen up.Eventually, everyone settles on a real estate strategy that they love because it fits their needs and their market. For Michael, who’s in a market with a large military population, that strategy is buying single family houses. At the height of his investing career, he had over a hundred houses, and he and his wife managed them by themselves. Even if you’re just a beginner, you need to understand property management. Michael drops his favorite tools for keeping track of his properties and his tenants.This piece of advice is for anyone who finds themselves underwater: Even if you’ve ill-timed the market, if you hold onto the house for long enough, it’ll rebound in price. You need to worry less about the equity of a home and think about the bigger picture. As your tenant is paying down the principal, you’ve got depreciation, amortization, and growth as factors that need to be considered over just the straight income.And finally, one of Michael’s favorite investing strategies is using a Roth IRA to purchase real estate. There are strict rules around what you can and cannot do, so check out any of the seminars, books, or gurus that Michael recommends. If you’ve got a creative deal that you’d like a fresh set of eyes on, connect with Michael on his website.What’s Inside:—By having less houses, he has more cash flow simply because there are less expenses and less maintenance to deal with.—Michael’s criteria for a subject-to deal.—How does he protect himself from the mistakes he made in the last housing downturn?’—You don’t want the cheapest home with the income factor; you want the house with the biggest growth factor.