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Real Estate Investing in Rentals - the $10 Million Real Estate Investing Mistake
Renting to tenants is no longer "where the money is" for real estate investing. I became a multi-millionaire landlord in the 1980s by buying $10 million in rental houses. Yet, I consider this real estate investing approach the biggest mistake in my real estate investing career. I call it my "$10 Million Mistake." Back then, real estate investing in rentals was buying a house, renting it to tenants for a rental fee that covered the mortgage, and waiting for an increase in value. Interest rates were as high as 25%. Inflation was rampant. You could buy a house, and it would almost double in value in 10 or so years. Boy, have things changed in real estate investing! Interest rates have recently been the lowest in 46 years. Inflation is flat. The same rental house in some areas is appraising for less today than it appraised three years ago. The major profit to real estate investing in rentals is the pay-down of the mortgage by the tenant. Otherwise, profit comes from the difference between the rental fee and the mortgage payment. One month vacancy per year, which is not uncommon, might convert into an annual investment loss, even if (1) tenants don't leave owing rent, (2) the property is not damaged, or (3) repair cost is negligible. All of these possibilities are very unlikely. One month vacancy per year can eliminate usage profit for the year. Spend your time on fix up repairs, even part time, and you go more in the hole. How much you lose depends on how much your time is worth. Real estate investing is intended to be profitable. Vacancies, repairs, and time expenditure might mean you are only making a donation to the great cause of improving the nation's housing. The scenario changes if the mortgage is negligible and note payments are significantly less than rents. But the beginning investor does not often create this situation. Fixing up properties for resale is a better venue for real estate investing today. Go a step beyond the norm, and learn how to help a renter get financing for your fixed up house. Go another step by converting a junker into a "Dream House," and you will attract prospects to your property like bees to honey. Turning a "Plain Jane" into a "Doll House" demands extra work, but attracts better quality buyers. Real estate investing is extremely profitable, but your choice of real estate investing venue is critical to optimal profitability. Phil Speer, Ph.D., started his real estate investing career 25 years ago. Without the availability of credit and using only a $10 bill, he purchased $1 million in properties in his first year, and had accumulated $10 million in properties by his fourth year. He was featured in a Wall St.Journal editorial as most successful investor in the Nothing Down Real Estate Movement, and was honored with a Caribbean cruise as top investor of the year. In his hometown of Nashville, Tennessee, he has been a businessman and Human Resources Consultant for 30 years. He is an author, speaker and seminar director. To learn how to profit in real estate investing, even without cash or credit, read his report at http://www.CashinHouses.com/. Subscription is free to his Fix-up Ezine. He and other contributing authors provide free articles and resources on real estate investing at his online "Academy of Advanced Real Estate Investing Techniques" - http://www.AAREIT.com/.
MORE RESOURCES: The Insult Comic Who Sells Million-Dollar Homes The New York Times Like Real Estate? Earn 12% With AWP Seeking Alpha The 36 Top L.A. Real Estate Agents of 2025 The Hollywood Reporter How Commercial Real Estate Investors View Capital Markets in 2025 Commercial Observer Local real estate investment firm details positive federal tax policy changes for investors SiouxFalls.Business DHHL Delays ʻEwa Real Estate Swap Over Environmental Concerns Honolulu Civil Beat Real Estate Startup Aims to Help Clients Make Smarter, Data-Driven Decisions National Association of REALTORS® Real Estate Notes: Downtown Hilton hotel opens Nashville Post Mel Foster Co. School of Real Estate offers pre-license courses Quad Cities Business Journal Matt Curtis Real Estate Completes 150th Home Build in Guatemala, Extending Global Mission of Service Huntsville Business Journal Real Estate Transactions, Sept. 15 edition Hopkinton Independent Commercial Real Estate Roundup for Sept. 12, 2025 Idaho Business Review Calvin Harris Accuses Financial Adviser of Stealing Millions to Fund ‘Boondoggle’ Real Estate Project variety.com Bay Area’s historic Green Gables estate sells for $85 million after steep price cut San Francisco Chronicle University of Alabama business school receives $5 million donation The Tuscaloosa News Dunlap & Moran real estate attorney named to Best Lawyers in America 2025 Sarasota Herald-Tribune Real Estate: September 1 to September 5 Newport This Week As AI takes over mortgage approvals, who’s watching the machines? Real Estate News by RealEstateNews.com AI and analytics key to navigating ‘exciting inflection point’ in real estate, UBS CIO says Pensions & Investments 7 Renovations That Might Actually Lower Your Home’s Value in 2026, Real Estate Pros Say - The Spruce Signs of more affordability, inventory in mid-Hudson Valley real estate market this fall Times Herald-Record Press Release: Korrin Petersen Joins Bowditch’s Real Estate and Environmental Law Practice Bowditch & Dewey Ocean-to-lake estate hits the market at $134 million in Manalapan, south of Palm Beach Palm Beach Daily News Calvin Harris Accuses Financial Advisor Of Stealing $22.5 Million For Real Estate "Boondoggle" Stereogum Canadian Apartment Properties Real Estate Investment Trust (TSX:CAR.UN) Confirms September 2025 Monthly Distribution Yahoo Finance Choice Properties Real Estate Investment Trust (TSX:CHP.UN) Declares C$0.064 Cash Distribution for September Yahoo Finance Capital Idea Community Pulse - Lima One Builds Unique Lending Model For Real Estate And Construction Projects Greenville Online A glance at Dayton's top commercial real estate transactions, totaling $18.8 million The Business Journals 261-unit River House along River Walk sold Texas Real Estate Research Center Inside Savannah Homes: 3 fully furnished condos overlooking Chippewa Square for $6.995M Savannah Morning News Does Las Cruces real estate take a winter holiday? | Column Las Cruces Sun-News Central Mass. real estate transfers, Sunday, Sept. 14 Worcester Telegram Northwest Healthcare Properties Real Estate Investment Trust Announces September 2025 Distribution Yahoo Finance HAR.com Expands to Include Commercial Real Estate Listings Realty News Report Texas now restricts Chinese nationals from buying property. Is it alien land laws all over again? The Guardian East Cobb residential real estate sales, Sept. 2-5, 2025 East Cobb News Best Real Estate Projects 2025: Channel 24 The Business Journals Hawthorne Capital Named Fastest-Growing Real Estate Company in the Americas by Financial Times Business Wire Strive305: Tico Casamayor & Irvans Augustin Talk Real Estate with Natalee Lima & Denise Sainz Miami's Community News Rare two-family waterfront home in Fairhaven sells for $1M. Weekly home sales SouthCoastToday.com Navigating home inspections, objections and appraisals in Colorado real estate The Chaffee County Times The Rise Of Branded Residences: A Global Real Estate Trend With Local Impact - Harlem World Magazine The Rise Of Branded Residences: A Global Real Estate Trend With Local Impact Harlem World Magazine Best Real Estate Projects 2025: Sutter Health Park Upgrades for MLB Play The Business Journals The “Most Expensive” Home In America JUST Hit The Market—and You Won't Believe the Price House Beautiful Linkhome Holdings Inc. Launches Platform for Real Estate Purchases Using Cryptocurrency Quiver Quantitative Hearthfire Holdings Innovates Real Estate Investment with Self-Storage Opportunities Programming Insider Renovated 125-year-old waterfront cape in Westport sells for $2.5 M: Weekly home sales Fall River Herald News Calvin Harris Accuses His Financial Adviser of $22M Theft: ‘Absolutely Breached That Trust’ Billboard Chicago Atlantic Real Estate Finance, Inc. Declares $0.47 Quarterly Cash Dividend for Q3 2025 Quiver Quantitative REALTY ONE GROUP POWERS INTO MEXICO CITY PR Newswire |
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