secoon
11-05-2004, 03:24 AM
A Real Estate mogul (REM) was to speak at a meeting of Mom and Pop landords (MPLL's) on how to grow their real estate holdings. In preparation for his presentation, he visited with one of them who had been very frugal and over the years accumulated 5 homes which were all paid off.
He asked them to show him their properties, which they did. The MPLL's took the REM around to the first house which was immaculate. The MPLL's introduced him to their tenants, the tenants children and even knew the name of the tenants toy poodle. The REM complimented the MPLL's on how well they kept the place and said to them " I'll bet this is your best property." The MPLL's replied, "No, we also own the one across the street, and 3 on the next street over." All were neat, tidy, and well maintained with friendly tenants.
The REM praised them on the quality of their properties and their great tenant relationships and asked how long it took to oversee them.
The MPLL's replied, "normally just 6 hours each week."
The REM then asked why didn't they buy more properties?
The MPLL's said they had enough to support their immediate needs.
The REM then asked, "but what do you do with the rest of your time?"
The MPLL's said, "When we paid off the last property we retired from our full time jobs. We sleep late, play a little golf, visit our grandchildren, try out a new restaurant every Friday and stroll to the community center each evening where we sip wine, and play pinochle with our friends. We have a full and busy life."
The REM scoffed, "I am a Harvard MBA and my mission is to help you. At tomorrows seminar I will show you how to strip the equity from these properties and use it as down payments on multi-family units. You'll learn how you can get second mortgages, which you'll need to pay the attorneys and accountants to set up you're LLC's and track your income and expenses. Your excess cash flow can be used to buy more properties, and hire a property management firm to screen your tenants and handle evictions, and a maintenance company to keep up with all the repairs.
Ultimately your accountants and attorneys will help you do 1031 exchanges and expand into commercial real estate and even start your own REIT. You will be able to afford the best attorneys, accountants and insurance agents who will guide you every step of the way.
Your banker will take you to some of the best golf courses in the state because you will owe him millions. Of course, you will need to leave this small town and move to a city with a more vibrant real estate market.
The MPLL's asked, "But, how long will this all take?"
To which the REM replied, "10 - 15 years."
"But what then?" Asked the MPLL's.
The REM laughed and said, "That's the best part. Once you have all these properties, you can write a book and sell seminars telling everyone how you built your empire and become very rich. You will make millions!"
"Millions - then what?"
The REM said, "Then you would retire and move to a small town where you can sleep late, play a little golf, visit your grandchildren, try out a new restaurant every Friday and stroll to the community center each evening where you can sip wine, and play pinochle with your friends.
He asked them to show him their properties, which they did. The MPLL's took the REM around to the first house which was immaculate. The MPLL's introduced him to their tenants, the tenants children and even knew the name of the tenants toy poodle. The REM complimented the MPLL's on how well they kept the place and said to them " I'll bet this is your best property." The MPLL's replied, "No, we also own the one across the street, and 3 on the next street over." All were neat, tidy, and well maintained with friendly tenants.
The REM praised them on the quality of their properties and their great tenant relationships and asked how long it took to oversee them.
The MPLL's replied, "normally just 6 hours each week."
The REM then asked why didn't they buy more properties?
The MPLL's said they had enough to support their immediate needs.
The REM then asked, "but what do you do with the rest of your time?"
The MPLL's said, "When we paid off the last property we retired from our full time jobs. We sleep late, play a little golf, visit our grandchildren, try out a new restaurant every Friday and stroll to the community center each evening where we sip wine, and play pinochle with our friends. We have a full and busy life."
The REM scoffed, "I am a Harvard MBA and my mission is to help you. At tomorrows seminar I will show you how to strip the equity from these properties and use it as down payments on multi-family units. You'll learn how you can get second mortgages, which you'll need to pay the attorneys and accountants to set up you're LLC's and track your income and expenses. Your excess cash flow can be used to buy more properties, and hire a property management firm to screen your tenants and handle evictions, and a maintenance company to keep up with all the repairs.
Ultimately your accountants and attorneys will help you do 1031 exchanges and expand into commercial real estate and even start your own REIT. You will be able to afford the best attorneys, accountants and insurance agents who will guide you every step of the way.
Your banker will take you to some of the best golf courses in the state because you will owe him millions. Of course, you will need to leave this small town and move to a city with a more vibrant real estate market.
The MPLL's asked, "But, how long will this all take?"
To which the REM replied, "10 - 15 years."
"But what then?" Asked the MPLL's.
The REM laughed and said, "That's the best part. Once you have all these properties, you can write a book and sell seminars telling everyone how you built your empire and become very rich. You will make millions!"
"Millions - then what?"
The REM said, "Then you would retire and move to a small town where you can sleep late, play a little golf, visit your grandchildren, try out a new restaurant every Friday and stroll to the community center each evening where you can sip wine, and play pinochle with your friends.