Why is real estate the best path?

Kevin Davidson - Friday, February 09, 2018

Hey, this is Steve Rozenberg with Empire Industries Property Management here in the Dallas, Fort Worth area. Today we’d like to talk about why real estate and why is that the best path.

Number one, I like real estate personally because I feel it’s the best way to be able to leverage, not only my time, but people as well as money. There’s three ways that you can leverage real estate. Obviously by leveraging people, you have realtors; you have title companies; you have mortgage people. That’s all leveraging people.

Money, obviously you get a loan. You put 20% down, 10% down, 50% down on a property. You’re leveraging the other half. So you put 20% down, you’re getting 80% leverage from a bank. That’s 80% you don’t have to come up with. I like the fact that you can leverage money. If you buy a stock, you cannot buy $100,000 worth of stock and get a loan for $80,000, and only put $20,000 down on the stock. I like real estate about that.

Obviously, time. That’s the one thing that I think investors as well as new entrepreneurs have a hard time understanding is that you don’t get more time. You don’t get that time back. With doing real estate, you can be doing other things; and if you have the right systems, policies, procedures in place, you can leverage time so it can run without you. The definition of a business is a profitable enterprise that makes money without you. You want to make sure that this profitable enterprise not only makes money but runs without you. There’s very rare businesses that you could leave, come back maybe a year later, if you have the right systems in place and you put the right tenant and all that, you could actually have an investment that’s worth more money. The rents go up so you have a lot of ways. You have a tenant paying down the debt. There’s a lot of things that you can do by owning real estate that you can’t do with other things.

I like those things. I like stocks. But the problem with stocks is, if you sell it, there’s very large capital gains. Intellectual property is another way that you can invest, but you have to have a product to invent intellectual property. Real estate, I believe, is the lowest barrier to entry. It’s the safest because you have it tangible. That’s why banks will loan on real estate, and they won’t loan on stocks. It’s not tangible. Real estate is tangible. It’s safe. You know it’s safe because banks will loan on it. It’s just something to think about.

Real estate isn’t for everyone. Sometimes people get into it, and they don’t like dealing with people. They don’t like dealing with tenants. You get a management company for that. Here at Empire Industries, we manage over 800 properties in the Houston and Dallas Fort Worth area. We make sure that we manage your asset like a business. We make sure that you are the CEO of the business, but we’re the operating system. If you’d like to give us a call, we do a free thirty-minute conversation. 888-866-6727. We can talk with you and see what’s best for you, and see if we can get you started on helping you find some properties as well as managing your current properties. This is Steve Rozenberg. Thank you.

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