April 1990 The key to creating wealth in real estate lies in acquiring it at a cost below the price someone else is willing to pay. True profit must be NET after taxes plus any inflation. You can get this from gain on sale or income. You can BUY AT A DISCOUNT in the distress markets. You can NEGOTIATE a BARGAIN PRICE, either by virtue of the AMOUNT paid or the TERMS/TIMING of payments. You can CHANGE THE USE. to increase value through re-zoning. You can HARVEST the property - extracting minerals, livestock or agricultural products for sale at a profit. You can LEVERAGE property so that your return exceeds the rate of inflation. And you can BUY IN THE PATH OF PROGRESS, and let DEMAND drive up the value of your investment. And of course, you can just get lucky and make a killing.

Continue reading “Negotiation Makes The Deal, But Management Makes It Pay Off . . .”

March 1990 This month marks my 20th anniversary as a licensed real estate professional. I was a jaded General Foreman in an electronic assembly factory when a good friend, Ray Flach, persuaded me to study for my real estate licence. Lucky for me that he did, because within a year I'd been laid off and had been extruded out of the manufacturing business into residential real estate sales. This letter is for those in similar circumstances, who, whether because of age or lack of future opportunity in a dead end job, want to find out more about the transition from the insulated life of an employee to the roller-coaster ride we call entrepreneurship. The decisions I had to make, the risks I had to take all led to the icing on

Continue reading “Twenty Years Later, Will The Market Do A Repeat?”

February 1990 I've just gone through over 9000 houses listed in multiple listing. These are arrayed in price and neighborhood sequence. I was trying to find out the listed price of houses comparable to the ones I own. They've almost disappeared! Very few houses in my area can be bought for less than $50,000. Those that can are by and large undesirable by virtue of their age, condition, location and/or functional obsolescence. What's happened?

Continue reading “What Ever Happened To The $50,000. House?”

January 1990 It's the last second of the ball game. Only time enough for a field goal attempt. The snap. Placement. The kick goes wide of the goal and the game is lost. But wait! Flag on the play. Defensive penalty. The down goes over. This time the kick is good. We win! If the 80s attempt at success went wide for you, the 90s offer a second chance.

Continue reading “The 90’s – A Decade Of Promise . . .”

February 1989 Bernard Baruch was a financial titan of the 20th Century who made a fortune by getting up every morning and going to the Stock Exchange at 4 A.M.. That was the time when the stock market in LONDON was opening. He'd buy stocks that were at low prices in that market, then at the opening bell in New York, he'd sell them at a profit. He was able to create an immense amount of wealth because he was willing to work in two markets at the same time and to use the difference in TIME to his advantage. That's a strategy that also can be used in real estate and may well become a very fast track soon.

Continue reading “It’s A Whole New Ball Game . . .1989”

January 1989 With the election over, I can start picking on a new Administration. It's getting easier and easier as candidates promise themselves into a box, then try to cover up. We have to give Reagan credit. The voters never caught on to just how serious things are for the economy. Unfortunately, American jobs and standard of living are influenced to a great degree by perceptions of the international community. Look at what foreigners did when it became clear that Bush had won. They began dumping dollars, stocks and started to buy gold. Only through the heroic efforts of the Japanese central bank to shore up the dollar by purchasing billions of dollars worth of them in just a couple of days was a real crisis averted. A full 60 days ahead of inauguration, the new Administration is being challenged to come up with workable solutions to American deficits and balance of payments problems which have grown to crisis proportions. Bush will have to hit the ground running.

Continue reading “Watch My Lips . . . Is This ‘catch 22’?”

May 1988 If you've been following the political campaigns this year, perhaps you've noticed that none of the candidates plan to do anything about our economic problems. In fact, the leading Democratic road runners all seem to be running on the tried and true 'tax-spend-tax' platform with a dash of anti-trade protectionism thrown in. None of them has any apparent concept of how American interests are linked to the international economy. Not to be outdone, George Bush seems to be the kind of fellow who can walk through snow without leaving any footprints. After a lifetime of public service, he's left no impact. Regardless who finally emerges as the next President, our nation will continue to be run by unelected bureaucrats who will continue to gain power and influence over our lives by issuing even more regulations to hamper the activities of productive citizens - tax payers.

Continue reading “And The Winner Is Government!”

April 1988 Probably the most important tax form for you to get in will be Form 4868! It gives you an automatic four month extension on the date you have to file your return, IF you send in the full amount of tax you think will be due along with it. But it has to be submitted on or before April 15th. If you're abroad on April 15th (think Mexico or the Bahamas, Canada), you have until June 15th to file and pay your taxes. The 4868 will give you two more months after that to send in your full return. If you can substantiate the need for additional time, then you file Form 2688. This can provide up to 6 months extension to the filing time. But IRS has the last laugh.

Continue reading “Have You Got Your Taxes Done Yet?”

March 1988 Did you ever get the feeling that you've been left out of the family picnic? For some reason or other, Entrepreneurs seem to be completely disenfranchized in this country. Everyone agrees that they're the back bone of our economic system, that they create about 85% of all the jobs, that the small business rather than the Fortune 500 is responsible for our prosperous middle class, that creative entrepreneurs are the source of much of our progress as a leader among industrial nations. But, we don't seem to have any champions to defend our cause at any level of government or politics.

Continue reading “If You Can’t Join ’em, Beat ’em!”

February 1988 The trouble with reading financial publications is that everyone has an opinion. You can find any prediction that you want and the savant who makes it will also provide an exceptional array of hedges so that the future won't prove him wrong. So what's a person to do? I think the answer lies in the Boy Scout Motto: BE PREPARED. Let's play 'Suppose'.

Continue reading “Yeah, But What If . . .”