On September 29th, 2008, the United States witnessed a financial disaster that would eventually overtake the globe. The Dow Jones Industrial Average fell 777.68 points after Congress refused the bank bailout bill. Seemingly overnight, the nation’s sense of security was swept off its feet. By 2009, 861,664 families lost their homes and foreclosing rates increased by 225% in two years. Ten years later, the effects have slowly dwindled away, but the fear persists as noted by the 23% of young prospective homeowners who see homeownership as a “bigger financial risk”, despite the market’s correction.
Eliminating real-estate investment fears, president of the International Capital Group, Adiel Gorel shares the minimum-risk/maximum-return solution: Remote Control Retirement Riches, the investment strategy designed for even the most inexperienced investor. As millions of Americans turn away from retirement plans and Social Security, find a simple solution in our upcoming broadcast discussing Single-Family Rental Homes.
Make an Investment with Confidence – not Fear
Owning multiple homes post-2008 may seem counterintuitive to financial stability. However, for the past 30 years, Gorel has developed and shared the Single-Family Rental Homes investment plan, assisting busy and inexperienced families to plan for their future without compromising the present. Explore a wealth-building strategy that has previously led to:
- Paid-Off College Tuitions
- Paid-Off Mortgages
- Paid-Off Home Renovations
- Healthcare Emergency Funds
- Investor’s Tax Benefits
Join Adiel Gorel in our upcoming broadcast, July 25 at 1:00 pm PST on KQED, to discover how to create multimillion-dollar rental single-family home portfolios using real-estate markets throughout the U.S. Learn about helpful loans and investment tips that support retirement riches regardless an investor’s age. Also, since real-estate investments involve several markets nationwide, you can implement methods at your own pace, maximizing your control over your investments while reaping benefits with minimal time constraints.
Erase your own investments fears and start planning the future with confidence. Follow us on KQED on the dates listed below to learn more at our interactive seminar. Visit our Membership Area for more detailed information and insights into becoming a home investor without becoming a full-time real estate mogul or hired landlord.
- KQED Plus: Sat, Jul 13, 2019 — 3:00pm
- KQED 9: Thu, Jul 25, 2019 — 1:00pm
- KQED Plus: Thu, Jul 25, 2019 — 10:30pm
- KQED Plus: Fri, Jul 26, 2019 — 4:30am
- KQED Plus: Sat, Aug 10, 2019 — 10:30am
For years, it’s been widely accepted that owning a home resides at the core of the American Dream, yet studies conducted by the Urban Institute report that 53% of millennials today cannot afford a home as they can’t even afford a standard 20% down payment. Between escalating healthcare costs and burdensome student loans, the average millennial would take up to two decades to save up for a down payment. The dream of owning a home may seem to be crumbling, yet based on these startling numbers, it is clear that the desire for financial stability is as crucial as ever.
While roughly 80% of millennials don’t expect to receive benefits from current Social Security policies, the pursuit of financial security and growth is still very much attainable through home ownership and rentals. Thanks to the magical 30-year fixed loan rate, maximizing savings’ funds can be done through remote control retirement, one of the many innovative strategies to be presented at the ICG Real Estate 1-Day Expo in San Francisco, U.S.
Dealing with the Unstable Concept of Financial Stability for the American Dream
As inflation and increased cost-of-living may pose as threats to buying a home, single-family home rentals revive the financial success “dream” as the most liquid type of real-estate on the market. Join us this September 7th, 2019 at South San Francisco Conference Center to learn how to leverage single-family rentals to your financial benefit while:
- Getting experts’ strategies and opinions
- Navigating taxes, loans, new markets, and more
- Networking with like-minded investors
- Exploring new market trends
- Participating in collaborative Q & A.
Just as technology advances year after year, it’s only natural that real-estate markets evolve with each generation, yet the result of a sound investment is a constant: financial success. Despite the negativity surrounding real-estate, there is still much to be discovered. Luckily, we are devoted to doing just that.
Whether it be through podcasts or interactive conferences, ICG is can help you invest in single-family rentals and guide you through a minimum-risk process designed to fit even the most inexperienced and/or busy rental owner. No matter your age, it’s not too late to start investing in your future. Register today before space runs out and build your own future on your own dream. Learn more with our podcasts and webinars in our Membership area where we outline strategies in more depth.
In a podcast I recorded recently, I gave my take on the question I get asked almost daily: “Before I start buying investment homes, should I create an LLC?” I begin by stating that this is a legal question and should be posed to a lawyer.
The 30-Year Fixed Rate Loan
As a non-lawyer, I point out some issues: We talk about the benefits of getting the fixed-rate 30-year loans. These loans are referred to as “FNMA loans” ( since they follow the FNMA – Federal National Mortgage Association guidelines). The FNMA loans will not be given to a new LLC. They will be given to an individual with income, a credit score, etc. Thus if you create a new LLC and buy the property in the name of the LLC, you will likely be giving up on one of the most powerful pillars of single-family rental investments: the 30-year fixed rate loan.
Also, again, speaking as a non-lawyer (always fact check with a lawyer), an LLC has protective qualities only if it adheres to being a completely separate entity from you. It needs its own bank account, checks, (checkbook) books (bookkeeping or software like Quickbooks) etc. If there is a shortage in the LLC, you cannot just transfer money to it. That would be commingling funds and may destroy any protective qualities the LLC might have had.
In addition, lawyers have been telling me that court cases indicate more and more that for meaningful protection, you need to have a multi-member LLC and not just a single member one.
A single member LLC is liked because it is a “pass-through” entity. That means the financials of the LLC flow through to the owner’s taxes and no separate tax return is needed for the LLC. However, a multi-member LLC needs its own separate tax return, K-1’s issued to the various members (and who is that other member, by the way?). That means more costly accounting fees and time spent.
In addition, some states require (besides a tax return), a yearly fee. California, for example, charges $800 per year per LLC.
I also mention that when you buy a home for $180,000 and put 20% down, you have a loan of $144,000. If a lawyer considered suing you and looked at this home, it would be unattractive – since the lawyer may not be a real estate professional, and he or she would assume that selling a $180,000 that has a $144,000 loan on it, will yield virtually no money after commissions, expenses, and perhaps selling quickly (it is not always an ideal time to sell). Thus the very existence of the mortgage is already a good protective measure.
Knowledgeable lawyers I know recommend using insurance as the first line of defense. Get good liability insurance on the home, and get umbrella insurance to cover up to your entire net worth.
Recently, I interviewed one of the best lawyers I have met on this subject, Brett Lytle, partner at McDowall Cotter out of the San Francisco Bay Area. Brett is also one of our expert guest speakers at our quarterly Expo once or twice a year. The podcast interview can be found in the Member’s area on our website: www.icgre.com/members
In a blog on RentCafe, by Nadia Balint, from April 2018, this is some of the information shared:
“The U.S. housing market has gone through nothing short of a transformation in the last decade. The number of people renting their abode has increased significantly, in some cities surpassing the number of homeowners. The housing market quickly responded to this shift by adding millions of rental units in just a few years, with many U.S. cities witnessing a frenzy of apartment construction.
The most interesting part of this transformation, however, was the fact that the rental market expanded even faster horizontally than it did vertically. For the better part of the decade ending in 2016, single-family homes for rent were the fastest growing type of rental in the U.S., outpacing the formidable apartment boom seen throughout the country.
According to U.S. Census estimates, the number of single-family rentals (SFR) in the U.S. grew by 31% in the ten year period immediately following the housing crisis (2007 to 2016), while multifamily rentals (MFR) grew by 14%. In net numbers, single-family rentals in the U.S. increased by 3.6 million units in ten years, more than rental apartments, which increased by 3.2 million units. As of 2016, the U.S. Census counted a total of over 15 million single-family homes for rent in the United States and a total of over 26 million apartments for rent.”
Oklahoma City leads the 10 Top Metros with the largest share of Single Family Home Rentals:
This is very likely helped by the tendency of many Millennials to rent instead of buy. Millennials have not been valuing home ownership as much as previous generations. Many of them value flexibility and the ability to move. Nevertheless, many Millennials are getting into the family-formation phase of their lives, and thus prefer single-family homes with a yard for the kids, dog etc.
All this dovetails perfectly into our investment philosophy: buy single-family homes in good areas in good large metropolitan areas, finance them with 30-year fixed rate loans (which never keep up with inflation) whenever possible, and hold. That will vastly change and improve your financial future.
We will discuss this and a lot more at our ICG Quarterly 1-Day Expo on Saturday 5/19/2018 near the San Francisco Airport. I will be teaching and holding extensive Q & A sessions. We will have expert speakers on Asset Protection, 1031 Exchanges, and Financial Planning overall. There will be lenders present, 5-star networking, and presentations from market teams from the most relevant markets in the U.S. You can attend free, with a guest by emailing us at firstname.lastname@example.org, and mentioning this blog. Looking forward to seeing you!
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