TR-HNR-December-2019-Digital

TR-HNR-December-2019-Digital

DECEMBER 2019 THINKREALTY.COM/HNR

MARKETS & TRENDS | 12 Manhattan: At a Crossroads MARKETS & TRENDS | 18 Is a Crash Coming? STRATEGY | 20 You Want a Partner?

ROBERT KIYOSAKI TALKS EDUCATION, JOBS, AND MONEY — AND WHY ALMOST ALL OF IT IS FAKE The Real Deal

Contents

DECEMBER 2019

FEATURED

12 MARKETS & TRENDS Manhattan: At a Crossroads The new statewide rent regulations of summer 2019 shook investors and raised more questions about New York City’s proverbial housing crisis. Nonetheless, Manhattan’s multifamily sector is on an upswing.

Optimize your ROI while taking the stress out of owning a rental home Real Peace of Mind

REAL Property Management has more than 30 years of experience, in 48 states and Canada, doing just that for our clients. Our highly skilled professionals—the most thoroughly trained in the property management industry—have one goal in mind—to help you make the most of your real estate investment. That’s why REAL Property Management manages your property like you would—like a business. Successful investors across the nation have trusted us to professionally manage every aspect of their rental real estate, providing them REAL peace of mind. Put another way, REAL Property Management helps you make the most of your investment in rental real estate while you make the most of your life. Visit www.realpropertymgt.com/optimize to learn how we can put our experience to work for you, giving you real commitment, real ROI, and real peace of mind.

THE REAL DEAL Rich Dad Poor Dad author and finance guru Robert Kiyosaki talks education, retirement, and money — and why so much of it is fake. 06

18 MARKETS & TRENDS Is a Crash Coming? The truth about the economy that no one will tell you.

20 STRATEGY You Want a Partner? What you need to know about joint venture agreements.

2 think realty housing news report

december 2019 3

© 2019 Real Property Management.Each office is independently owned and operated.

4 think realty housing news report

december 2019 5

FEATURED ARTICLE

Robert Kiyosaki on education, retirement, and money — and why so much of it is fake. REAL DEAL The

BY KELLI WHITE PHOTOS BY THE RICH DAD COMPANY

W hen real estate mogul and finance guru Rob- ert Kiyosaki took a real estate course in the early 1970s, he had a feeling it was what he was destined to do — to be an entrepreneur. Known for his unconventional teachings on finance and his passion for real estate, the best-selling author knows a good deal when he sees one and he is sticking with what works. The real estate class cost $300, which was quite a high sum in the early 1970s for a military pilot making $800 a month. Kiyosaki, a Marine Corps and Vietnam Veteran, bought his first real estate

property in 1973 when he was stationed in Hawaii. Now, he owns more than 7,000 properties — from residential and commercial to hotels — and they all bring cashflow. Armed with a passion for learning and shar- ing his views, no matter how nonconformist they might seem, Kiyosaki, author of Rich Dad Poor Dad and more than a dozen other texts on money management, investing, and financial freedom, said he was a terrible student. But for him, doing poorly in school transferred to becoming a lifelong learner in his own way.

"ONE OF THE

BIGGEST LIESWE HEAR IS YOUNEED MONEY TO MAKE MONEY.”

ROBERT KIYOSAKI

6 think realty housing news report

december 2019 7

“I flunked out of school,” he said. “But I study con- stantly. I love learning. I was not good at school, but I kept learning when so many others didn’t.” He joked that he learned everything he knows from playing Monopoly. “I like schools where I can DO some- thing,” he said. So, it’s no wonder why pilot school and the military worked well for him. His point of view is that ‘old’ advice — go to college, get a good job, save money, get out of debt, invest for the long term, and diversify — has become obso- lete advice in today’s fast-paced Information Age. His philosophies and messages challenge the status quo and his teachings encourage people to take initiative to become financially educated and play an active role in investing for the future. Kiyosaki’s most recent book is titled FAKE — Fake Money, Fake Teachers, Fake Assets in which Kiyosaki dispels many of the societal teachings that, in his view, have not worked and are not entirely true. “ FAKE is about how fake our money is, and you can’t pass off fake money without fake teachers. There are so many people my age (Baby Boomers) who have nothing. And so many Millennials are also in serious trouble due to student loans. Banks and Wall Street are fake. To me Rich Dad, Poor Dad was high school, and FAKE is col- lege. I’m essentially saying the same message,” he said. Kiyosaki shares his messages about financial edu- cation via his Rich Dad brand platform in books and myriad outlets including videos, radio, apps, and board games. His CASHFLOW games teach people of all ages about investing, managing assets and liabilities, and building wealth. The Rich Dad brand celebrated its 20th anniversary in 2017, and 2020 is proving to be a big year for Kiyosa- ki as he has three projects in the works. The next book scheduled to release is called The Ravens , which he co-authored with James Rickards. “A raven is a bird of prophecy. My co-writer Rickards and I are always calling market terms. The book is about how you can see the future and predict markets,” he said.

Robert Kiyosaki on Failure… “I’ve lost hundreds of millions of dollars, but it was the best thing that ever happened to me because I got smarter and came back. You learn by falling, but our schools punish those who fall down. Sometimes I win and sometimes I lose millions, but a real winner is one who gets inspired losing. The average person avoids losing, so they never win. How can you win if you’re afraid of losing?” On Job Security… “People pay a high price for job security. In prison it’s called maximum security. I visited a prison in Australia and saw their version of the worst punishment. It was being locked in a room and I thought that’s where most employees are. They’re in maximum security. It’s the worst punishment in the world. And unfortunately, that’s what most kids come out of school looking for.” On Taxes… “How do I make millions and not pay taxes? Invest in real estate! But, you have to understand the tax laws. Tax laws hurt small businesses and those with 401ks. I love passive income that is taxed at zero.”

“AREAL WINNER GETS INSPIRED BY LOSING.”

8 think realty housing news report

december 2019 9

He is also working on a doc- umentary called The Future of Money and Who Stole My Pen- sion , a book about Baby Boomers with little or no retirement. “The average 401k for retiring Baby Boomers is only $75,000 total,” Kiyosaki said. “As long as you’re an employee with a 401k, you’re toast. I was destined to be an entrepreneur and invest in real estate, and I believe the world needs more entrepreneurs who will create jobs.” Kiyosaki has been heralded as having a gift for simplifying com- plex concepts related to money, investing, finance, and eco- nomics. His core principles and messages like “Your house is not an asset” and “savers are losers” have ignited a firestorm of crit- icism and ridicule, only to have played out on the world econom- ic stage in prophetic ways. He said the reason he chooses to invest in real estate is be- cause it’s about debt. “The more debt I use, the THE REAL DEALS ARE IN REAL ESTATE

“With real estate, you can always locate your own deal and be in control of your properties. I don’t sell — only rent. If you find a good deal, why would you sell it? I’m not the most popular person on Wall Street, but I just do what I talk about. When you invest in real estate, you’re in shadow banking; you’re out of sight. You operate by a different set of rules using private equity and private credit.” “Debt is tax-free money and my cashflow is tax free. Why would I invest in anything else? When I say I pay no taxes and make millions, people go crazy because they’re in the stock mar- ket not shadow banking. I make the deals and control my deals because it’s private investing. I can’t do that with mutual funds and stocks.” With perspectives on money and investing that often con- tradict conventional wisdom, Kiyosaki has earned an interna- tional reputation for irreverent straight talk and has become an outspoken advocate for financial and real estate education. He said, “Why would you want

A Brief Query with Robert Kiyosaki

What are you reading right now?

A New Earth by Eckhart Tolle and Can't Hurt Me: Master Your Mind and Defy the Odds by Navy Seal David Goggins.

What is your favorite book you’ve written? Why A Students Work for C Students . I was a terrible student, but I love to learn. I just didn’t want to learn what they were teaching and how they were teaching it. Now, A students work for me!

What do you do for fun? Make money! Life really can be like Monopoly. It’s only a game!

a job and pay taxes? Why would you want to save money when the government is printing money? Why would you save money when interest rates are approaching zero? Why invest in the stock market when it’s rigged against you? I don’t talk about things I do not do. You won’t hear me talk about praying because I don’t do that. I’d rather go look for a deal.” •

less tax I pay and the higher returns I make. I love real estate, but you have to educate yourself. If you’re not going to invest in education, you might as well stay in the stock market. One of the biggest lies we hear is you need money to make money,” Kiyosaki said. He further explained why he prefers to be an “inside investor.”

Click here to listen to Think Realty's podcast featuring Robert Kiyosaki, which aired in October 2019.

10 think realty housing news report

december 2019 11

MARKETS & TRENDS

Manhattan: At a Crossroads

MANHATTAN RENT GROWTH BY ASSET CLASS (Sequential 3 month, year-over-year)

SOURCE: YARDI MATRIX

A LOOK AT REAL ESTATE TRENDS IN THIS TRENDY METRO.

LIFESTYLE

RENTER-BY-NECESSITY

6.0%

by Yardi Matrix

T he new statewide rent regulations of summer 2019 shook investors and raised more questions about New York City’s proverbial housing crisis. Nonetheless, Manhattan’s multifamily sector is on an upswing. The borough’s year-over-year rent growth as of August sur- passed the U.S. figure for the first time in many years. Meanwhile, at 98.5 percent as of July, occupancy in stabilized assets remained flat over 12 months. New York City gained 111,500 jobs in the 12 months ending in June, with education and health services accounting for nearly two-thirds of this total. While em- ployment growth lagged national figures for the past two years, it marked a 1.5 percent expansion, just 20 basis points below the national growth rate. Although domestic migration is not favoring expen- sive gateway metros at this stage in the cycle, and in

4.0%

fact Manhattan gained just 75,000 residents between 2010 and 2017—a 4.8 percent uptick that was below the 5.3 percent U.S. figure—adding 2,600 people in 2017, it remains a prime destination for international migration. It is also the country’s preferred location, by far, for both domestic and cross-border capital, including real estate investment and development. RENT TRENDS With the metro area’s housing crisis deepening, Man- hattan’s median home value surpassed the $1 million mark last year, representing a 44 percent hike since 2009. Renting and owning are nearly equally unafford- able: In 2018, the average mortgage payment accounted for 58 percent of the area median income, while the

2.0%

0.0%

-2.0%

-4.0%

average rent equated to as much as 60 percent. Costs are on the rise in the borough, and there’s little re- lief in sight for the affordability crisis. According to Freddie

Mac research, Greater New York’s number of multifamily units considered affordable to very low-income households dropped by 5.6 percent between 2010 and 2017.

12 think realty housing news report

december 2019 13

Manhattan: At a Crossroads

And rent growth remains unabated for now, having rebounded from the negative figures recorded less than two years ago. The average Manhattan rate was up 3.5 percent year-over-year through August, 20 basis points above the U.S. figure, according to Yardi Matrix >Page 1 Page 2-3 Page 4-5 Page 6-7 Page 8-9 Page 10-11 Page 12-13 Page 14-15 Page 16-17 Page 18-19 Page 20-21 Page 22

Made with FlippingBook Online newsletter