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Does real estate investing really make people rich?

renatusus

renatusus

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Apr 1, 2013
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There are some people who get incredibly wealthy through stocks and some
other people who do not. For the people who don`t succeed, is it that
stocks don`t work or that the people using them don`t all possess the
right knowledge and skills?



It`s funny because every man is a `self made man,` it`s just only the
rich who admit to it. The wealthy are what they are because they have
applied knowledge that works. Studies repeatedly conclude that over 90%
of wealthy

individuals have become wealthy through real estate. Does it really
work? It works better than any other system of business to produce
wealth with the right knowledge and skills.
 
Interesting "philosophical" question. IMHO, timing is the only thing that makes you rich.

I would be very suspicious of any get rich schemes especially now given the global state of the economy and inflated asset values.

People should be more concerned about the return OF their money than the return ON their money.

However, Real Estate does a good job over time to accumulate and conserve wealth.
 
As the saying goes, there are a million ways to make a million bucks. Real estate is a general term that encompasses a many number of ways. There are other ways to become wealthy. It all depends on the individual's ability and temperament.
 
I would bet there's a direct correlation between the number of posts someone has made and the wealth that they have managed to accumulate in real estate.



However, I so often hear that ridiculous claim that 90 % of millionaires do it through real estate and its never backed up by some kind of reference or source documentation. This is just some urban myth - there is no way 90 % of wealthy people, however you define wealthy, got wealthy through real estate.
 
Knowledge is not a money making matter. But time is an important one. When we apply our knowledge in right time and situation, it really works. It may lead us to make money. Mortgage brokers are famous for their timing in their respective industry. So be alert about each and everything that deflects or reflects in real estate industry and also update your knowledge by reading blogs and mortgage reviews from any websites.
 
I'm in the "business" of helping entrepreneurs transform their business. That business happens to be real estate.



Do you know WHY they get into it first? It's truly NOT to become rich. Some THINK that. Some SAY that. But the truth is, ALL of us just want to SOLVE A PROBLEM.



So the question is, what is the problem you want to solve?



For most people, it's to get out of a crappy job and live more freely. Traveling, doing stuff they love. We need MONEY to do that.



But we get caught up in "money". That's why most people fail at whatever they do - real estate, stocks, whatever.



I've been an entrepreneur my entire life. I've learned to design my LIFE first and FIT a business component in that works for my lifestyle. I came from the professional DJ world, to the radio celebrity world, to the production one, the corporate manufacturing life finally to real estate.



That's a jagged line of careers don't you think? But they fit my lifestyle at the time.



Do I want to be rich? Yea, I want money...but I don' CHASE money. I chase my LIFE and figure out how I can fit a business in that works.



I don't know your story or background, but I can tell you that all of my clients come to me thinking they have to SACRIFICE something to gain something. (ie: put in major time, buy all the courses, study after work - every night - every weekend)



When it doesn't happen fast enough, they move to something else.



I learned from one of my mentors Brendon Burchard that we ALL have a field of opportunity - we start digging a hole and when we don't strike Gold, we move on to dig another one.



The successful ones, the ones I choose to model dig ONE hole - they keep going UNTIL they reach Gold.



The difference between the two is that the ones digging opportunity holes every year ends up with a field of half dug holes at the end of their life with nothing to show.



The ones digging foundational holes, the ones WAITING for Gold and then planting a post end up with a streamlined fence of solid posts and structured assets that have let them live their lives in FULL.



I hope only the best for you and hope this inspired you to look more at how you want to live your life FIRST and then figure out if Real estate is what you want to help sustain it.



Richness comes from much more than money.



Ask me how I know that.
 
4Only speaking for myself, an individual can focus on making money to the exclusion of helping others and still be successful. It may not be the best way for everybody, but it does work.



Some people say that my method takes advantage of other people. Other people say that I solve other people's problems. I never really give it much thought.



When the stock market tanks and people panic; I take their shares. When the real estate market tanks and people panic; I take their homes.



Stocks



TFSA



An individual can pile up a healthy collection of money/shares/property during market downturns.



Between downturns, I spend time with family and friends and enjoy every day. I am grateful that I was born in a capitalistic environment that allows me to create money from "nothing". I'm not particularly materialistic so market downturns can create far more money than I need.



One side of the coin says that I'm solving an individual's need to be relieved of the stress of falling asset prices. Another side of the coin says that I am taking advantage of them during times of distress. It depends on the perspective. As far as I'm concerned, both are inadvertent. I am looking for money. And when I see the market giving me free money, I take it.



I only invest for money. I feel that it's easier. I don't answer to anyone but myself. At this point it's just a game. I don't NEED the money and I'll never be the richest person on the block. I don't have the desire or work ethic for that. But if the market offers me free money, it's little effort to just take it. For better or worse. It works for my personality.
 
I personally do not work to help others, I work solely to help myself financially. If others benefit from my efforts, and many do, all the power to them.

In my opinion no one works for free, whether it be for money or personal gratification it is still only for their own personal gain.

The world would grind to a halt were it not for personal greed.

No one works in any capacity without expecting a reward (at least no sane person).



"You get a job for the paycheck and stay for the pension".

"You invest to gain personal gratification through wealth"



Tango I doubt that posts reflects wealth or I would be the richest on this thread at this point (which I highly doubt). However in one scene I may be the richest as I do have all I need and want financially at this point in my life. I am on the back side in the sense that I have lived longer than I have left to live and as such have enough to finance my present lifestyle to my termination point.
 
[quote user=JoeRagona]I'm in the "business" of helping entrepreneurs transform their business. That business happens to be real estate.



Do you know WHY they get into it first? It's truly NOT to become rich. Some THINK that. Some SAY that. But the truth is, ALL of us just want to SOLVE A PROBLEM.



So the question is, what is the problem you want to solve?



For most people, it's to get out of a crappy job and live more freely. Traveling, doing stuff they love. We need MONEY to do that.



But we get caught up in "money". That's why most people fail at whatever they do - real estate, stocks, whatever.



I've been an entrepreneur my entire life. I've learned to design my LIFE first and FIT a business component in that works for my lifestyle. I came from the professional DJ world, to the radio celebrity world, to the production one, the corporate manufacturing life finally to real estate.



That's a jagged line of careers don't you think? But they fit my lifestyle at the time.



Do I want to be rich? Yea, I want money...but I don' CHASE money. I chase my LIFE and figure out how I can fit a business in that works.



I don't know your story or background, but I can tell you that all of my clients come to me thinking they have to SACRIFICE something to gain something. (ie: put in major time, buy all the courses, study after work - every night - every weekend)



When it doesn't happen fast enough, they move to something else.



I learned from one of my mentors Brendon Burchard that we ALL have a field of opportunity - we start digging a hole and when we don't strike Gold, we move on to dig another one.



The successful ones, the ones I choose to model dig ONE hole - they keep going UNTIL they reach Gold.



The difference between the two is that the ones digging opportunity holes every year ends up with a field of half dug holes at the end of their life with nothing to show.



The ones digging foundational holes, the ones WAITING for Gold and then planting a post end up with a streamlined fence of solid posts and structured assets that have let them live their lives in FULL.



I hope only the best for you and hope this inspired you to look more at how you want to live your life FIRST and then figure out if Real estate is what you want to help sustain it.



Richness comes from much more than money.



Ask me how I know that.




Very well said Joey. I read your post and it hit home for me. As tough as it may be to live that way, I still strive to do so. Nevertheless, I want to continue to CHASE my life and really live for the moments. I've reached a point in my life where I don't want to CHASE money anymore...however I still need money to live the life I want to live i.e. travel the world.



I use real estate as a vehicle to build long term wealth...not to get rich quick. It's basically a substitute to a pension plan from a corporation.



Anyways...I enjoyed reading your post:)
 
[quote user=AndreiAngelkovski]

I use real estate as a vehicle to build long term wealth...not to get rich quick.
Well said.



The combination of 20-25% cash down plus 75-80% mortgage, held 5, 10, 15 or 20 years, monthly rent collection, monthly mortgage paydown on cheap cheap mortgages, value increase through time and improvements is extremely powerful.



The trick is to be able to hold long enough, i.e. allow time (and improvements) to work its magic while holding with (some) cash-flow !



Then it is not a get-rick-quick scheme, it is a get-rich-for-sure scheme !
 
Thank you Andrei! I appreciate the feedback and most importantly how it helped you a bit.



Being at the point where you no longer CHASE money is bliss. I don't know how else to put it.



That is in NO WAY suggesting that I don't need money, or to MAKE more money - it's just that I view my life as being way more important. I've lived through the cliches that "money is renewable" and all that, and really - it is. But it's DAMN scary when you don't have it.



My advice to everyone I coach is to ensure their financial life is taken care of before embarking on any venture to change their lives (such as investing in real estate) because so many fail at 'business' - especially when they put the pressure of finances in play as well.



So you're doing it right - real estate is foundational wealth for me to. That's why I'm so secure in all the components of my business: from attracting to JVs to buying specific properties. ALL of that fits into my lifestyle. If it takes a year to buy a property, it takes a year.



Peace
 
[quote user=JoeRagona]to ensure their financial life is taken care of before embarking on any venture
.. not everyone is afforded this luxury, Joe !



Many folks specifically invest in real estate to create add'l income or networth because their financial situation is not so rosy i.e. they have no government or corporate pension and not much money leftover from their job.



Only very few are "beyond money".



People work for four reasons:

  • for the money
  • for the social connections
    for intellectual stimulation
    for society / others / the world at large / to contribute beyond self


Ditto for real estate.



Personally, initially (15 or so years ago) it was primarily for networth improvements (i.e. "for the money"), and today I'd say all 4 are far more balanced but I'd be foolish/dishonest to state I'd do it for free i.e. only for the lower 3 reasons.



Borrowing money at low rates, and having others (i.e. tenants) pay of your mortgage and improve your networth is a very compelling business that works for many. it can be scaled up or down, i.e. you can do it very part-time besides a classic job and family obligations, or it can be scaled up to a billion $ enterprise (if that is the desire and if one has that ability actually). A great business to be in, but the exact configuration takes a few years to master and a lifetime to perfect.
 
[quote user=ThomasBeyer]People work for four reasons:

  • for the money
  • for the social connections
    for intellectual stimulation
    for society / others / the world at large / to contribute beyond self


Ditto for real estate.




Solid post.



Only speaking for myself, I work/invest for the money. I've mentioned in other threads that my motivation, for better or worse, appear to be more obsessive/compulsive than anything else.



I have social connections outside of work.



I use social connections as well as reading to stimulate intellect/curiosity. Specifically I would generally read articles about finance, philosophy, mind, psychology, e-sports, gaming, MMA, science and technology.



I don't think about contributing to society/to contribute beyond self. That's more of an ego thing doesn't really interest me. I only have interest to contribute to family/friends. When I'm dead, I'm dead. Society can fend for itself. And it does. Often. The universe moves on.
 
I woke up in bed with my two young sons lying next to me today thinking how lucky I am not to have to get up and go to work for someone.



I quit my "day job" (I actually got laid off) 4-5 years ago, and pursued a career in Real Estate Investment. I have built up a modest portfolio of properties that were well chosen, and cash flow. With some quite decent equity.



I am far from rich. I don't own a yacht, a house in the Bahamas, nor even a Lexus. What I do have is lots of free time. Therefore, I spend a month in Florida with my wife and 4 kids every year, and I have rather become a stay at home dad for 4-6 months of the year. The rest of my year is spent looking for the right property(s) to invest in. I could probably work harder at my investments, but looking after 4 kids is a reasonable (if lame) excuse. :)



Not rich, but like to think my retirement is being looked after, and we haven't fallen into the trap of having strangers looking after our children, in the best years of our lives, while we go doing the double income thing, that so many feel is required.



I see lots of dual income parents with kids, who work in decent to great paying jobs, who can afford a Lexus, a huge house, cottages on the lake, and even a nanny for their children. They would be considered rich by many people. I personally don't get it. While the creator made a finite amount of real estate for us to purchase, one often forgets that we also have a finite amount of time with which to appreciate the things that are most important.



Question you have to ask yourself is - what is rich - to you?
 
[quote user=nubiwan]They would be considered rich by many people. I personally don't get it. While the creator made a finite amount of real estate for us to purchase, one often forgets that we also have a finite amount of time with which to appreciate the things that are most important.


Well said, my friend !



Congratulations on your rich life !!



[quote user=nubiwan]nor even a Lexus.
I bought one for $50,000 10 years ago. That vehicle today is driven by my (now adult) children as they go to university. This vehicle today is less than $7500, and almost like new on the inside (and yes, many dings on the outside) . Check out www.leasebusters.com .. a (used) Lexus is easily in the cards !



Time is indeed precious - and the most democratic resource on the planet: everyone has 24 h per day !
 
[quote user=nubiwan]I see lots of dual income parents with kids, who work in decent to great paying jobs, who can afford a Lexus, a huge house, cottages on the lake, and even a nanny for their children. They would be considered rich by many people. I personally don't get it.


What you do not get is that is the life style they have personal chosen and by doing so they have achieved or are achieving their goals of being "rich".



Other than those that chose to leach off of society (welfare) each individual, whether they are aware of it or not has chosen their own path to personal wealth. Their path may not lead to what others, or even they themselves define as wealth but they are the only ones that ultimately control that path.

Some place no value on having children others believe there life revolves around having children, Neither is right or wrong just different.
 
[quote user=invst4profit]What you do not get is that is the life style they have personal chosen and by doing so they have achieved or are achieving their goals of being "rich".



Other than those that chose to leach off of society (welfare) each individual, whether they are aware of it or not has chosen their own path to personal wealth. Their path may not lead to what others, or even they themselves define as wealth but they are the only ones that ultimately control that path.

Some place no value on having children others believe there life revolves around having children, Neither is right or wrong just different.





+1 Great post Greg!



Only speaking for myself, I don't want to look after my child 24/7. I did that when she was 1 years old, I didn't like it, and I wouldn't do it again.



Unfortunately, many individuals who raise children themselves are like some religious fanatics - there is only one "right" way...
 
Steady everyone. Having defined my version of wealth I qualified my post by asking what is rich to the OP.



I never asked for any validation nor approval. Rather stating that accumulated assets are not the only measure of a man's wealth.



In the end, one mans rich is another mans drudge. Gotta define you're own. We comfortable with that philosophy?

My answer to the OP is yes, RE investment has made me rich, but probably for reasons he/she might not have considered.
 
Well said and put together in such a convincing way. Couldn't say it better myself. Thanks for sharing!!!!!!
 
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