Buying commercial real estate can be very lucrative and a very secure and profitable investment. If you just take the time to research, get advice from experts and know your risks and benefits you will be rewarded by a steady flow of income for the rest of your life.

Single family residential investment is great to start of your investing career with and I myself own several single family residences across 4 different states. They are OK investments and provide some cash flow but nothing compared to a 8, 10 or 30 units apartment complex or industrial or shopping center commercial property. Being an appraiser I appraised apartment complexes in my early career, hence I naturally migrated intro apartment complex investing. One of the guides that helped me a great deal and is one of the best commercial investment bibles out there is the “Commercial Real Estate Guide” by Austin Davis who is a renowned nationwide commercial investor. I have referred to his guide often when wanting to invest in apartment complexes within a new state.

Why is Buying Commercial Real Estate So Lucrative?

• The monthly cash flow is  much higher
• There’s a lot LESS risk — the risk is spread out among multiple tenants
• Because the cash flow is higher, you can afford to hire someone to manage your property for you (freeing up your valuable time)
• Your profits can be TAX FREE (or at least Tax Deferred - indefinitely) through refinancing or through a secret the IRS doesn’t want you to know about: they call it the “1031 Tax Deferred Exchange”
• Forced appreciation — that’s just a fancy term for improving a property to increase its value (increasing the amount of cash in your pocket). I’ll show you easy-to-do, low-cost improvements you can do on your properties that add more zeros to the end of your checks!
• Much less competition — Everyone else around you is focusing on single-family homes because NO ONE ELSE in the country is teaching how to creatively invest in commercial property

After you purchase your first commercial property, I promise you that you will have learned so much in the process that you will never turn back and start investing in single family residences again.

Can anyone regardless of credit, income or assets be able to invest in Commercial Properties?

Yes, most people are under the impression that it takes a great deal of money and credit to qualify for an commercial loan. Nothing could be farther form the truth. What most people don’t know is that for lenders on commercial loans, the property is the main focus, the applicant which is you is considered to be a secondary concern. For example on a 32 unit apartment complex, which I purchased recently for $450,000 with only 5% of my money and the rest of 15% from 2 partner investors, the lender’s entire concern was to determine if the building income and expense ratio met their qualifications and once it did then they approved the loan. They did review my application real quick but they did not care much about my income, unlike a residential loan. The building is the main applicant on commercial transactions, so even you do not have full time job or only make $20k-30k a month you can get approved for a loan amount of $1-2mil if the building meets your lenders debt service requirements.

You may also find properties and get investors to invest with you as partners by creating an corporation with all of you listed as equal or percentage partners. This way you can come in like I did with minimum cash or often times no Cash, depending how you created your partnership. Since lenders look at the property’s income and expense you still may qualify even if you do not have a good credit score, income or assets.

I hope I have answered some of your quesitons regarding commercial real estate investing and for those of your who would like to know where to start your research, I sincerely recomment “Commercial Real Estate Guide” which will direct you to the right path to start investing in commercial real estate as soon as possible.

Getting rich in Real Estate is not easy. Many people start out in real estate investing with great fervor, only to become discouraged after a few months when they don’t attain instant fortune.

They discover they can’t get rich quickly and easily, so they move on to the next scheme. These impatient investors often make one common mistake: They learn a few tricks and think success will follow instantly.

Another common mistake is seeing the instant success of someone else and believing you’ll have the same results. In reality, this rarely, if ever, happens. These people may have had a good plan, but face failure because they didn’t give the required effort necessary to achieve the goal.

It takes a lot of work to achieve long-term success in real estate, which is why so few accomplish it on a grand scale.
Start with lofty, but reasonable goals

Thinking big is great, but I cringe when I hear someone say, “I want to make a million dollars in real estate in my first year.” Everyone loves a dreamer, but there’s a fine line between dreams and delusions!

Someone who earns $50,000 a year and has no prior experience investing in real estate probably wouldn’t make that kind of money by next Christmas.

What kinds of expectations are realistic for a beginner? The best approach is to set short-term, intermediate, and long-term goals. Be sure your goals are realistic, specific, and attainable.

For example, your goals may look like this:

• Fifteen-year goal: Retire with $10,000 in passive income per month, inflation-adjusted. This may require between $3 million and $4 million in free-and-clear rental real estate.
  
• Five-year goal: Acquire between $3 million and $4 million in real estate in steadily appreciating areas. Buy, fix, and flip five properties per year at an average profit of $20,000 to replace current income.
  
• One-year goal: Wholesale two or three properties, buy, fix, and flip (retail) two properties and acquire three rental properties to keep long term.
  
• Six-month goal: Buy one rental property and do two or three wholesale flips.
  

Be as specific as possible

. . . and take time to do the math. For example, if your goal is to retire within fifteen years, how much income will you need to attain that goal? If you need $10,000 per month, will that require owning and collecting rent on five houses? Ten houses?

Will you be managing that property? If you pay a manager, how will that affect your bottom line? If you need $10,000 in today’s money, what will that amount be worth adjusted for inflation? The more diligently you put the pen to paper (or the fingers to the keyboard), the better prepared you’ll be.

To avoid setting yourself up for certain disappointment and possible financial disaster, you must forget the dream of becoming an overnight millionaire. Instead, focus on the slow-and-steady route, aiming to accumulate wealth one small step at a time, one deal at a time.

And, of course, seek help along the way from qualified experts who are active in the business. The more mistakes you can avoid on your path to riches, the faster you will reach your destination.
Article above written by: William Bill Bronchick

In Real Estate “Time” is a Wealth Development Tool

From The Desk Of Colm Dillon

Hello, Colm here …

In this report I use figures from my area of the world … I know they don’t apply all over the world, but they should encourage you to get the figures for yourself.

After all no report is going to make your money grow … it’s the knowledge you gain and “Your Application Of The Knowledge” that makes your financial wealth Grow.

In another report I gave you a concept I borrowed from Phil Ruthven, a truly wonderful speaker on economics, on how he looks at Home Ownership.

Now I want to look at the Tools we have available to help us Grow!real estate wealth,

So folks, if you want Real Estate Development, you must use all the tools available to you to get some. Of all the tools you have, the single most important one is TIME.real estate wealth,

1. Time is your greatest friend. Time to buy good investment property and let it double in value every 8 to 10 years or better.real estate wealth,

2. Federal Government Real Estate Investment Tax Deductions are another tool the Government uses to tell you in Words Dollars and Cents that they want you to get wealthy so you can look after yourself to your final days. real estate wealth,

3. Correct Financial tools are also vital to your wealth development. See my report of Finance. I will go into some further detail in this section on the use of Evergreen Lines of Credit and how they work.

4. Good Real Estate Management is the next tool. Well-managed and well-maintained real estate investments, that houses good quality tenants is also essential. Trying to do this work yourself, is a mistake. See my report on Property Management. real estate wealth,

In Australia, it has been instilled in our consciousness, that we must all own our own home. And there is nothing wrong with the concept. It’s just that we should have been told to rent it out; Don’t live in it.

By buying a house TO LIVE IN, while we are young, we are wasting the wealth creating tools of Time, Double Income, (if married) Property Income and Tax Deductions. No wonder so many people have to play catch up later in life. real estate wealth,

So the first clue to Real Estate Wealth Development is don’t buy a residential property for you and you partner to live in. You buy a house as an investment and you rent elsewhere.

Growth Tool No. 1 – Time

Time is your greatest friend. Real Estate is a long-term investment and by being loyal to it, the real estate will reward you handsomely all through your life. real estate wealth,

You can prove this to yourself, as I did, by getting the figures of average house sale prices, from the Australian Bureau of Statistics for Brisbane, the largest City in Australia.

To save you the trouble I got the figures and I painstakingly went through them in order to validate the old wives tale that, “real estate doubles every seven years.”

Well, it does better than that, you’ll be pleased to know.

I was able to get the figures from 1973/74 to 1994/95. I think I started there because that was when I arrived in Brisbane on transfer from Melbourne. real estate wealth,

That is a twenty-two years period, during which we had several credit squeezes, a few recessions and a few good times as well.

In 1973/74 an average house price for the whole of Brisbane was $23,234.00. That average includes the best and worst house and suburb.

Seven years later, in 1980/81, it was $43,470.00 an increase of 87%.

However by the next year, the eight-year, it had risen to $56,757.00 giving an increase of 144% from 1973/74. So you see that it more than doubles by the eight year. real estate wealth,

Going on a further seven years from 80/81 to 87/88, the $43,470.00 went up to $83,679.00; a further 92%.

Interestingly, going on one more year to the eight year, it had again increased to $113,917.00 giving an increase of 162% from 1980/81.

A further seven years from 87/88 to 94/95, the price of the average house in Brisbane went up to $163,325.00; a further 95% increase. real estate wealth,

Unfortunately the Bureau amalgamated the Shires of Logan and Caboolture into this statistical base and I could not extract the figure for the eight year.

However on the evidence of the previous 22 years I believe it is safe to assume the increase would be at least 5% making it an increase of 100%. real estate wealth,

So these figures prove that over a period of 22 years the asset has increased by seven times its original value and all you would have to do is buy it at the beginning.

I hope this gives you some idea of why TIME is so important to growth. And remember that I am talking about average prices, I am not talking about hot inner suburbs that will obviously do much better.

If you REALLY understand these figures; you should ask yourself why you are willing to miss out on buying good real estate by stopping negotiating for the sake a few hundred or a few thousand dollars. I’ve seen this done many times because of stubborn-ness. Crazy! real estate wealth,

For goodness sake it’s the Real Estate Asset that is in short supply; not money. If you have found real estate that fits your criteria; BUY IT!