Street Smart Success

The biggest asset class in the world is the U.S. single family housing market. That’s why the health of this asset class has such a large impact on the broader U.S. economy. Over time, single family homes have been one of the most predictable, conservative investments available. In most ten-year periods, home values have almost always gone up in value. Rich Fettke, Co-founder at Real Wealth.com an...

Buying sub-institutional size deals entails less competition, and therefore lower prices. In the $3 - $10 million dollar range, competition is mostly local to a specific market with a buyer pool that generally doesn’t include national or regional players. David Hrizak, CEO of The Streamline Companies, buys, builds and manages across various asset classes in Phoenix, the 5th largest market in the c...

Finding an avenue to high returns can be difficult in saturated markets. Certain markets outside of major metros, however, can provide a unique opportunity for great returns as major metros have become exorbitant for large swaths of owners and renters. Colby Swarz, Vice President of Capital Markets & Investment Strategy of Burkentine Real Estate, builds Planned Urban Development communities wi...

Although retail has been out of favor over the past several years with the threat of ecommerce, it’s gained traction more recently. As opposed to being venues for traditional soft goods stores, retail space is becoming utilized for other purposes such as medical services, boutique gyms, and restaurants. There’s also been negligible new construction since 2008, so demand for space has outgrown supp...

It’s always difficult finding a deal, even in down markets, but if you’re willing to be contrarian, there may be lucrative opportunities that present themselves. One example is vintage 100+ year old multifamily properties in downtown Portland, Oregon. These properties are trading at 300-400 basis points higher than suburban value-add properties that hardly cash flow, and appeal to a large subset o...

Sometimes the best ideas are the simplest and seem the most obvious in hindsight. Co-warehousing is one of these ideas. Co-warehousing was created for small, often start-up businesses to rent smaller spaces for shorter periods of time. These spaces are typically sub-1000 s/ft, as small as 250 s/ft, which are desirable to entrepreneurs who can be moving out of a home office or storage space, or jus...

One strategy to get big discounts on multifamily properties is to buy the loans from current lenders at below par. Once a mortgage becomes 60-90 days late, lenders will consider selling the note to de-risk their position and redeploy the capital into other loans. Buying pools of these notes is a strategy deployed by larger funds but can also be used by smaller investors to acquire buildings in sma...

The single-family housing asset class is the largest in the U.S, valued at $70 billion. In the past few years, however, this asset class has seen some of the same challenges of other commercial real estate classes, such as overleverage, increased interest rates and escalating expenses. As a result, attractive opportunities are starting to emerge that translate into solid investments that can gener...

Although prices on multifamily have come down, the market still hasn’t stabilized. Rents have come down in many markets and expenses have increased, but prices have still not adjusted accordingly. Additionally, cap rates are still often lower than interest rates. Brian Burke, President and CEO of Praxis Capital, a multi-decade multifamily investor, has transitioned from multifamily to investing in...

As major metros have become too expensive, investors are moving to tertiary markets in order to improve yield, thereby driving up prices in these markets. Smaller markets can be attractive because prices can be 50% less and rents not that much lower. Southern New Hampshire is a great example, as buyers from Boston and other markets are entering this market and paying record prices. Axel Ragnarsson...

In today’s market, investors are finding it difficult to achieve strong, reliable returns. That’s why more investors are acting as the bank, making loans directly to other investors who don’t qualify for shorter-term bank loans despite having excellent borrower qualifications. These loans are shorter-term, real estate-backed loans that often generate low double-digit returns. Fred SaintAmour, Owne...

As a passive investor, one way to reduce risk and also participate in the upside usually reserved for General Partners, is to invest in a GP fund. By investing in a GP fund, you get to participate in the fee income generated by the fund while also sharing in the upside economics of the individual deals. Instead of achieving mid-teen returns, you can potentially do considerably better, even as high...

One of the most resilient asset classes in commercial real estate is Mobile Home Parks. Almost no new parks have been built in the last couple decades, and many parks are being repurposed for higher and better use. Mobile Home Parks are the most affordable housing option that has wide appeal to renters getting squeezed by inflation. Patrick McDonald, Principal of Community Management Group, owns a...

After many years of peak prices, distress is starting to appear in multifamily apartments, including newer properties. As debt maturities are looming, operators aren’t able to absorb the new debt costs plus all the other increased costs of the past few years including taxes, insurance, and other operating expenses. As a result, properties are now selling at prices at significant discount to replac...

Investing in older, infill markets that are being repositioned and growing can be a recipe for huge appreciation. Over the past decade, several cities in Northern New Jersey with easy access to transportation have seen explosive growth in values. Gentrification has led to changes that have made these areas desirable to live in for upscale demographics. Aaron Fragnito, Co-founder of People’s Capita...

There are over 20 million rental homes in the U.S. Because of the higher prices of these homes, however, investors are making less on them than they have in decades. These days, investors are making more money by financing the homes than owning and operating them. When you’re the lender, you get monthly payments without having to manage the properties, and you generate higher returns. Eddie Speed,...

Single family homes have always been a great way to invest in real estate if you buy them at the right discounted price. If they’re in the right neighborhood in a stable or growing market, you will have no problem renting them, and they have historically appreciated over time. You also can use other people’s money to acquire them. Jay Conner, The Private Money Authority, has flipped over 500 house...

An often overlooked and misunderstood category of Real Estate investing is tax liens. 2% of property taxes annually don’t get paid, which presents an opportunity for investors to invest in tax liens or tax deeds. With tax liens, you can earn interest when the property owner pays off the delinquent taxes up to 18–36% annually, depending on the state. In tax deed sales , you can acquire properties a...

The largest asset class in the world is single family houses in the U.S., worth a total of $35 trillion. Not only is it the largest asset class, it’s the least risky if you invest with low leverage. One way to participate in the appreciation of this asset class without the potential downside is with Home Equity Agreements. Home Equity Agreements are contracts between investors and homeowners where...

In order to become an expert in multifamily takes decades. From knowing all aspects of the physical properties and maintenance, to the nuances of property management, and how to buy properties at the right price, requires a lifetime of knowledge. Paul Carassone, The Property Boss, has been acquiring and managing properties in New York for over the past 25 years. Paul started with his father and br...

Smaller industrial buildings are seeing high occupancy levels and strong buyer demand. Even in slow growth, or slightly declining markets, the demand for industrial space is increasing because of limited inventory. Kip Northrup, a small business entrepreneur, started out by acquiring his first property to locate his pond and aquarium business, but has gradually expanded to 14 industrial properties...

Many long-term real estate owners have experienced tremendous appreciation and consequential equity in their properties. This is a great boon, but as a result, they are generating very small returns on their equity, sometimes as little as 2%. For these people, exchanging their properties via 1031 exchanges is a great way to improve cash flow and to no longer have to manage day-to-day operations. B...

One area of the economy and commercial real estate that’s flourishing is luxury travel. Well located, well managed hotels are unique assets that retain their value irrespective of the macroeconomic environment. In the past few years, this trend has been amplified because of the cost to build and resulting limited new supply. People who have the economic wherewithal will always prioritize upscale e...

Despite the common convention, you can buy homes without cash or banks. You can use seller financing, subject-to existing loans, or lease purchases, allowing you to control properties without personal guarantees or large down payments. There are many reasons sellers will sell on these terms, among them because they can command a price they didn’t get on the open market, they don’t want to pay fees...

When it comes to Real Estate investing, you can be a borrower, or you can be a lender. When you’re the lender, you get monthly payments without having to manage the properties, and you can generate the same or higher returns. There’s a secondary market for buying loans from original note holders at a discount. Fred Moskowitz, Fund Manager and Investor, quit his job in 2015 to become a full-time no...