Real Estate Expert Says Buy and Hold Strategy is the Best Way Investors Make Money!!

Surprised?  I'm not.  When I read this, I understood completely that the best way to create wealth for oneself is to acquire and hold (rent out) real estate.

Just in case this was NOT news for everyone in the good ole US of A!

Buying real estate and holding it long term (leasing it to tenants) has always been the best way to get the best return on your real estate investment.  Two-Thirds of all Billionaires have made their billions using this concept.

Now, this may NOT work as well for single family homes and condos.  BUT, in the CRE world, the best return has always been the one held over the long haul.  Buy now; and Sell years from now when the investment has run its course.

If 2/3's of the billionaires in the US attribute their wealth to real estate, it should NOT make anyone say: Golly, gee wiz!

Recently, there was a Blind Item about a Celebrity who made +/-$100 Million during a ten year period who is now (essentially) broke and living off his actress wife's savings.  Now, I could guess at who this might be; but I won't because I find this Blind very hard to believe that anyone smart enough to make $100 Million or $10 Million a year would actually be stupid enough to invest so recklessly.

But if it is true, the celebrity is a complete moron for NOT diversifying his investments and for falling victim to the (supposed) high yield return scheme.

What's the old saying: Don't put all of your eggs in one basket.

Now, if you start small and work your way up, such as buy one rental property at a time; or, one small commercial real estate (CRE) investment at a time, over time, the return on the real estate will eventually pay off. (Such as the recent posting about the 9% Cap Rate property located in Las Vegas, NV I blog about last month.)

And, for you who are new to my blog, buying Las Vegas real estate does have a long term value increase preset before the 2008 economic meltdown disaster.

Most people who had acquired their Las Vegas properties a long time ago, did NOT lose their property during the recession because they had so much invested in keeping the property up to date; and they did NOT over-encumbered it by a high LTV loan.  Never pay off credit card bills with your real estate equity.  That is just dumb!

So, smart real estate investors, you know the drill...

Contact David Howes either by email: davidATdavidhowesDOTnet OR call him at: 70 25 01 93 88 AND you can Follow David on Twitter: @DavidAHowes

Looking For a CRE Steal in Las Vegas? What about a Great Deal @ +/-9% Cap!

In the past I have written about Las Vegas CRE Cap Rates.

But, most investors I deal with on a regular basis truly don't understand how Cap Rates work.

Now, I don't mean to insult anyone, but I do need to explain that as long as long term interest rates are set at a number so low, the cause/effect of those low rates will keep CRE selling prices high -- which means low Cap Rates!

You see, if you get a loan at 3 or 4 percent, Cap Rates will remain at 5 to 6 percent.  It's just fundamentals. (Please contact an economist for further explanation.)

Anyway, back to my theme...

A local property owner contacted me last week to ask me if I could help him find a buyer for a property he acquired out of foreclosure a few months ago.  You see, he re-leased the property to the existing tenant on new five year lease; and now wants to sell where he would make a small profit. (I always consider $100,000 a small profit.)

Anyway, I took the property information, sent it out to six or seven experienced property owners I had grown to know through the years and waited for their response.

One, called me right away and said: "That property is Crap! Find me a Good Deal!"

Not insulted, because I do understand this investor's thinking.  He was actually the one who wanted me to find him a Walgreen's at an 8% Cap Rate. (They currently don't exist anywhere in the US.)

Anyway, I had to explain to him that the tenant's lease was a new ink not dried five year lease, with a five year option.  I told him he would actually be buying this property at a 9.5+/-% Cap Rate.  In essence, this is a steal!

So, the tenant isn't a national credit corporation; the tenant only has this single location; and he had been very, very busy operating his auto repair/tire business here for many, many years.

Is the property old?  Of course.  The building was built in 1970.
Was the lot large enough for his use? Yes, it is!  It is on a .51 acre parcel right on a corner. (And, it is fenced!)
Is the street traffic busy enough? Yes!  It is addressed on a heavily traffic street that runs east west across the Las Vegas Valley.
Plus, there is a Lowe's and a Walgreen's in what I term: "Within Throwing Distance." (Now, I know for a fact that I can't throw that far, but you get the idea.)

Still, the price, the newness of the lease, the fact that the tenant had been there for a long, long time and is paying a good monthly rent of $5,200 NNN per month, you would think that this might be flip-able in the near future(?).

Well, if you buy at a 9.5% Cap Rate -- when long term interest rates are at 3-4%, all of you should be picking up your cellular phones and calling me ASAP!

Asking price? $750,000!  Selling price? $650,000.

What are you waiting for? Call me!

Contacting David Howes is easy -- either by: davidATdavidhowesDOTnet OR call him at: 70 25 01 93 88 AND Follow David on Twitter: @DavidAHowes

Another Las Vegas "Strip" Property For Sale!

There have been a lot of 'hits' on my web site about Las Vegas Resort Properties.  Several have been searching for "Strip" Properties.

Fortunately, there are properties located on the Las Vegas Strip that could be acquired.  (And, I am direct to one Owner who will compensate me for bringing them a Buyer.)

For a First Time Las Vegas Blvd Buyer, the price may seem too high!  However, since the property falls under the Clark County Gaming Overlay; and, it is located within the correct part of the "Resort Corridor," the Owner is being smart in their pricing.

Most surrounding properties have or will make +$100 Million in EBITDA annually.  Some, will earn +$300 Million.

And, the property is large.  If thinking of going bigger, it could hold +/-10,000 rooms in hotel Towers that could reach +/-500', it is also large enough to include a Mall, and has enough frontage along the "Strip" for profitable restaurants or retail shops.

Also, the Owner is willing to compensate me for bringing a Buyer.

If you think this fits your acquisition criteria, then click on the Las Vegas Casino Information button located in the right hand column; Print the Non-Circumvent Form; Have your President or CEO fill it out completely (authorized signatory's only); and scan and email it back to me.  This is necessary so that I know that everyone stays honest with each other.

And on it, I ask that the Buyer pay me 1%.  That is there only if the property in question doesn't actually fit, I can, without hesitation, find you another property?

Contacting David Howes is easy -- either by: davidATdavidhowesDOTnet OR call him at: 70 25 01 93 88 AND Follow David on Twitter: @DavidAHowes