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15 Reasons Why Real Estate is the Best Investment - YouTube
Channel: Alux.com
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Halloway Luxor's we're thrilled to have
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you back for another amazing Sunday
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motivational video especially today when
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we're breaking down why real estate is
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and has been the best go-to investment
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for building wealth by the end of this
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one you should have a clear
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understanding of how wealth is built
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through real estate and why the rich
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always have some part of their portfolio
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invested in land and buildings
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welcome to Alex calm the place where
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future billionaires come to get inspired
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if you're not subscribed yet you're
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missing out keeping the intro short here
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are 15 reasons why real estate is the
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best investment to make you rich number
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one store of value historically the real
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estate market has outperformed goals in
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terms of store of value and returns
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exceptions being the events post 2007
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but even then the smart investors have
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picked up properties with a discount
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real estate is one of the safest
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investments one could make because the
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value of properties rarely goes down and
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even then it's only for a short period
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of time you can rest assured the value
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of your property doesn't get devalued as
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more buildings rise up unlike fiat
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currencies like the US dollar which
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drops in value every time new money gets
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printed you want your value to be saved
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generations from now by land by
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buildings number two natural
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appreciation 1 the population is
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constantly increasing too people need
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places to live and do business 3 most
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businesses are concentrated in hotspot
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cities these 3 drive the demand for
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housing up constantly thus increasing
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the value of a property out the average
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home everywhere in the world appreciates
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in value by 3 percent per year the
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trending markets are seeing even more
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rapid growth for the past decade central
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real estate has appreciated on average
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by 6 percent per year
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effectively doubling in value every 10
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years or so not only does a real estate
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maintain its value over time but it
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grows your value for you due to the
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constant increase in demand
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number three forced appreciation on top
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of natural appreciation there are
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options which you can use to drive the
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value of property up by yourself
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forced appreciation is increasing the
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property value through direct efforts
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and investments into the property put on
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a fresh coat of paint fix the roof add
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solar panels insert technology interior
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design all are tools that can force the
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value of property to go up this is the
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main reason why the entire house
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flipping market exists people find
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properties that are in poor shape may be
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undervalued force appreciation onto them
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and sell for a profit
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not only is Real Estate a solid asset
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but you can actively build it up to be
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worth more if you choose to number for
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tax benefits governments really like
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real estate investors and they treat
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them differently when it comes to
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taxation real estate investors pay less
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tax than almost any other citizen why we
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provide housing for the general
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population and increase value by
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developing land this is why real estate
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investors are called developers here are
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just some of the tax deductibles you can
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receive as a real estate investor one
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depreciation deduction from income to
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mortgage interest tax deductions from
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income 3 cost of repairs maintenance and
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upkeep for cost of services rental
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property management and legal
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consultation or services 5 utilities 6
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travel costs associated with the
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property like checking in on the
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property for business purposes and 7
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property tax deductions no matter where
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you live in the world you'll find that
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government's often treat real estate
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investors better than small business
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owners or the rest of the citizens
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number 5 passive income for life this is
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probably our favorite point and if
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you've been in a lexer for some time now
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you're already familiar with cash flow
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and earning passive incomes from
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properties which is why we'd like to put
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it in a different perspective own an
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apartment in Manhattan or Paris that's
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rented out and as of making this video
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you can live for the rest of your life
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from that single rental fee we
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personally know people who've done this
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Andrey
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located full-time to Asia people need
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central housing and there are no new
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apartments built in the center of cities
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even when they do they're ultra
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expensive and out of the reach of the
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average person specifically because
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these projects are reserved for other
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real-estate investors there will always
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be demand for quality real estate and
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people are willing to pay the high-end
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rates because the alternative is to
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waste up to two hours every day in
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transit from the edge of the city real
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estate is the modern-day version of an
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oil rig in your backyard working 24/7 to
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make money for you and here's a
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fundamental lesson for you from one of
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the greatest investors of all time
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Warren Buffett if you don't find a way
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to make money while you sleep you will
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work for money until you die if this
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interests you we made a dedicated video
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on the best books on real estate
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investing which you can check out by
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clicking in the top right corner number
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six market cycles believe it or not
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experienced real estate investors loved
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market cycles they love it when market
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prices go down and property prices drop
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why because they can buy more for cheap
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while everybody is freaking out while
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the economy is struggling
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that's when investors come out to buy
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and sell as much as they can if somebody
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offered to sell you a brand new Ferrari
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that you knew was worth $300,000 for
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only $100,000 knowing that all you have
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to do is keep the car in the garage for
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a couple of years maybe drive it now and
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then and you could sell it for twice
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that amount if you wanted to wouldn't
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you make the deal real estate enjoys
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similar market cycles to the stock
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market and as of making this video right
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now we're about to enter into a downturn
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for the market those of you with the
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funds get your wallets ready number
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seven price range a big issue most
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people have is that real estate is not
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accessible that it's too expensive yes
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it's expensive if you look at real
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estate in Manhattan or Paris like we
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mentioned earlier but move up it into
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the edge and prices begin to drop
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considerably you can buy a one-bedroom
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apartment in Tbilisi Georgia for $20,000
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you can buy a three-bedroom apartment in
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Spain for 40,000 euros Zillow is filled
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with $60,000 homes up for sale and
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here's a brutal truth for you if you're
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unable to make $50,000 to invest in a
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property
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the investment life isn't for you on the
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other side of the spectrum you have
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mansions castles residential complexes
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shopping malls and office buildings
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there are options for everybody you just
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have to look number eight
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fairly easy access to funding anywhere
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in the developed world you have access
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to banks banks provide credit if you're
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employed and prove that you have the
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means to pay the money back it's never
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been easier or cheaper than it is today
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to have access to capital many
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governments are offering preferred
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interest rates when it comes to buying a
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home learn about these programs and take
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advantage of them
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in some cases there is as little as five
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percent money down on a credited
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investment backed by the state and
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everybody has access to these types of
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crediting programs don't complain about
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the game being rigged if you don't take
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the time to learn the rules number nine
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refinancing for most people refinancing
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seems limited to getting another credit
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card to cover a previous credit real
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estate investors do that as well when
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interest rates drop they go to a
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different bank take out credit and pay
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for the previous one and now pay less
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than they used to keeping more of the
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rental money in their pocket but
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refinancing can do more for you if
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you're smart let us explain it through
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an example you search the market and
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find an undervalued property worth
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$100,000 that you're able to buy for
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80,000 the thing is you only have twenty
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thousand dollars so you borrow the
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remaining sixty thousand dollars from a
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bank instead of going for a quick sale
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you invest five thousand dollars more
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into fixing up the place and getting a
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quality tenant to rent it you now go to
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a different bank and ask them to
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refinance your house they look at the
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property and your rental income it's
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generating and they offer you up to one
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hundred and thirty thousand dollars in
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financing you pay the sixty thousand
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dollars to the previous bank and are
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left with seventy thousand dollars in
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cash on hand to buy two or three more
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properties this is the simplified method
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of building Wells through BRR
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rehab rent refinance and it's how most
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beginner real estate investors get their
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portfolio star head number 10 other
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people pay for your investment but let's
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say you don't want to do all these
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financial acrobatics and instead want to
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settle for just ownership all you have
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to do is make sure the income coming in
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from the rental property is greater than
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the mortgage plus supportive expenses
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here's how the math breaks down you put
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down twenty thousand dollars for a one
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hundred thousand dollar property with
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the remaining eighty thousand dollar
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mortgage for thirty years the property
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rents out for twelve hundred dollars per
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month
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your expenses are mortgage three hundred
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and fifty dollars a month utilities
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insurance repairs management and vacancy
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let's bundle all of them up to six fifty
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totaling one thousand dollars this
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property has a cash flow of two hundred
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dollars for the next thirty years it
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will put two hundred dollars every month
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into your pocket while the tenant will
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be paying for your mortgage and other
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expenses effectively buying you a
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property and maintaining it where else
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can you get such a low effort investment
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ninety percent of all millionaires are
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invested in real estate now you know why
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a valuable book that probably very
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little of you have read is building
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wealth one house at a time by John
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Schaub lucky for you it's available on
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audible so if you go jail XCOM slash or
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free book and it's your first time
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signing up you can get it for free as an
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audiobook get the audiobook listen to it
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and take notes number eleven tangible
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asset many investors believe in seeing
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and touching their investments some
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people look at crypto and stocks as
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imaginary money for those people real
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estate is by far a preferred choice you
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simply can't go wrong with owning land
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or property in the case of an emergency
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you could use it personally as a
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residence or an office the fact that
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can't be stolen or hacked is also a plus
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traditional investors prefer tangible
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assets with a steady return over the
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high-risk high-reward alternatives
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number twelve easily insurable insurance
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companies are all over the world every
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property every piece of land can and
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maybe should be insured there are entire
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infrastructures around insurance of real
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estate properties with insurance brokers
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competing against each other for the
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best rates with the highest coverage
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with your property insured you're
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sleeping well at night as your tenant is
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covering that cost as well the main
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reasons why you should insure every
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property you own are one protection from
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property damage natural disasters happen
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so be protected to reimbursement for
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lost items theft and break-ins happen so
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be protected three protection from
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lawsuits people will try to sue you for
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any reason whatsoever so be protected
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number thirteen easily transferable to
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kids this is another big one for those
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of you looking to build legacy wealth
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real estate is easily transferable to
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the next in line the infrastructure is
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there in most countries and states there
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is no tax on inherited property let's do
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the math shall we if you do your job
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well buy some properties leave it to
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your kids and they don't screw it up and
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instead manage to acquire the same
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number of properties as you did but by
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the time the third generation comes
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around the rental income coming in from
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these properties should be more than
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enough to cover their living costs this
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is the reason why the richest families
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in Florence and 14:27 are still the
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richest families in Florence to this day
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they own property and land they
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diversify by investing in businesses and
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the fortune keeps growing number 14
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diversification when people think of
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real estate they picture an apartment or
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a duplex rent it out to a single family
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but there's more to this story there is
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a plethora of options when investing in
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real estate one single family like an
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apartment two multi-family like a
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townhouse three apartment complexes this
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one's pretty self-explanatory for
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short-term rentals like Airbnb
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five hotels you've most likely stayed in
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one before
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six commercial like owning the space
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where the bakery is next door seven
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commercial complexes like owning a
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shopping mall eight office buildings
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companies moving their employees in nine
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industrial owning the space where
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plastic cups are being made ten
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agricultural land and these are just the
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most common ones
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although these properties are similar
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they behave differently have different
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needs and different price points number
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15 fairly easy to liquidate the last
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reason on our list is quick access to
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cash if you need it although it's not
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easy to liquidate as your stocks due to
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the high demand there's always someone
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looking to buy on average it takes most
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people between 60 to 90 days to sell a
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house although that sounds like a lot it
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really isn't when you think about it
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not to mention that if the cash need is
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urgent you could take out a mortgage or
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refinance the place all of these reasons
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should get you thinking we actually
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recommend you check out local real
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estate websites and find out just how
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much money an entry-level property like
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an apartment or a duplex goes for in
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your area then make a plan for the next
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couple of years to be able to get
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yourself there one property at a time
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and just out of curiosity how much is a
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one-bedroom apartment where you live let
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us know in the comments who knows maybe
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your city is ripe for investment and a
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Lexus will jump at the opportunity and
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since you've been watching these videos
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until the end for so long
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you of course deserve a bonus here it is
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the truth about real estate the truth is
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that most people don't start with real
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estate right away even the real estate
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gurus like Grant Cardone Robert Kiyosaki
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and more recently every real estate
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youtuber they have a main hustle which
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pays for their real estate investments
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Grant Cardone made his money selling
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courses on how to sell Robert made his
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money selling books and the likes of
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Graham Stephan earned more from YouTube
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than they ever did in real estate even
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for us as a full disclaimer if we didn't
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have our investments and media companies
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we wouldn't have been able to grow our
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real estate portfolio as quickly as we
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did find yourself a source of money
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where you can exponentially grow your
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income the more you work the more money
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you're able to bring in then instead of
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spending it use the money to invest in
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real estate
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date secured your fortune this way
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that's how you become wealthy you work
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for money until you have enough money
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working for you your goal in the next
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five years should be to dramatically
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increase your income so that real estate
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investments are quite accessible if
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owning properties is on your goal list
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and you're still watching this video
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please write the word goal next to your
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answer of today's question in the
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comments below thank you for spending
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some time with us a Luxor's make sure to
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LIKE and subscribe so you never miss
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another video
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we also hand-picked these videos which
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we recommend you watch next you can talk
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to us on all social medias or ask a
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question on our website Alex calm thank
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you for being an a lexer and we'll see
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you back tomorrow
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