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How Much Do You THINK You Know About Real Estate Investment
Real Estate investment is NOT something which can be learned from TV gurus, or the like. Truly successful investment is the result of a strategy, a clear and comprehensive plan of action executed flawlessly, yet with flexibility and adaptability. We are Russell Realty Solutions, and this is precisely what we do, and do very well.
First, your plan to build your Wealth Portfolio, or at least the Real Estate portion thereof must include residential multi-family, commercial, (office & retail). Too many Investors make the mistake of racing to acquire SFR, single-family dwellings. Their pursuit of equity is a flawed strategy; whereas making investment decisions based on the pursuit of, or the objective to accrue equity is NOT how you build wealth. I have always advocated as a strategy, the accumulation of "doors"; the execution of a real cash flow acquisition strategy.
Consider the prominent factors in leveraged scenarios; FMR (Fair Market Rent), COF (Cost of Funds), and the disparage between the 2 which is your margin, your cash flow! I'm going to hold back from giving too much of an economics lesson here however consider this. The capitol necessity expended in a leveraged acquisition of a single-family asset in some markets, is comparable to that in the acquisition of a duplex, or perhaps even a tri-plex, yet your ability to realize increased cash flow from having the single asset with multiple doors is what is king in the cash flow game.
In a cash flow strategy you're less concerned about your equity position at close of escrow. What many Investors fail to realize is that when you pursue acquisition based on cash flow, you end up with equity as a bi-product anyway. Your tenants are paying down the debt every month thereby increasing your equity over time. Equity Investors are always having to "guard" their equity, yet what they fail to understand is that the guarding of your equity is often not in YOUR hands or within the realm of YOUR control. Market factors, economic factors, even socioeconomic factors which you cannot impact may topple your equity tower. However, in a cash flow game, such diversions are less impactful. Hell, in a down market, your vacancy is virtually a non-factor thereby increasing cash flow.
Here's the bottom line; when was the last time you calculated CAP rate, EBITDA, ROI, NOI, or leveraging thresholds?? How about a pro-forma (3, 5, 7, or 15 year), or factored cash flow analysis for an asset generating revenue from multiple units and even multiple sources?? How about your last effort to project the long-term cash flow analysis considering COF, FMR, annual appreciation as well as FMR increases, to also include cyclical vacancy rates, etc., etc., etc.
If you've not done these things, conducted this level of analysis, don't worry, you're not alone. If you have done so, yet hate it, don't worry, you're not alone; in fact in both cases, you're in good company. The reality is that many Investors do not have any idea of how to conduct these analyses which are requisite for commercial and multi-family acquisition. Truth is, many are intimidated by these potentially larger investments and therefore tend to avoid such opportunities.
Allow me to introduce our INVESTOR CONCIERGE Service, a FREE consultative service where we do the work, and you grow your Wealth Portfolio and create true Legacy through successful Real Estate investment. We begin with a consultation where the objective is to fully understand your personal, individual available resources, your goals & objectives, your investment needs, your return thresholds, etc., etc. Resulting from this session is your own, very custom Investment & Wealth Building Plan of Action. Russell Realty Solutions is there with you lock-step in the execution of Plan over the immediate, mid, and long-term. Working with us, you will not simply benefit from our expertise, you will LEARN the requisite skill set to be a truly successful Real Estate Investor, establish your Wealth Portfolio, and thrive in the cash flow game in ANY market circumstance!
We are Russell Realty Solutions, and we are your Investor Concierge!
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