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larrywww

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Reply with quote  #1 
So, here's the thing.  I've listened to Vena Jones Cox for something like the last 4 or 5 years----she has had her radio program for at least 15 years---much longer than Bruce Norris---though i have listened to all of Bruce's programs too.  Vena's list of radio shows tops out at 300 shows (back to 2010)---but that is a limit Itunes enforces, she has been doing this for much longer.  

Overall, I consider her radio shows to be not quite as informative as the Norris Group show, but that's because I tend to like Bruce's guests a bit more.

And, Yeah, I used to be put off by the "Real Estate Goddess" label, until I figured out she was indirectly making fun of the whole guru thing by having a gaudy nickname---and until I actually got around to listening to her radio show.

She hails from Cincinatti ("flyover country", as she says)----not exactly the heart of real estate appreciation.)  But I will tell you that I consider the REIA club she is affiliated with (which she used to be President of) to be maybe the # 1 or # 2 real estate club in the country in terms of the value of what is delivered to the subscribers.

Like Sdcia, the club has a real estate library and probably has more speakers and programs than sdcia does.

And what I liked about her show was that she had speakers who weren't "the usual West Coast suspects"---which can get awfully old after you've been in the business for a long time and their talks tend to get repetitive.

And although I probably don't really an urgent need to listen any longer, I thought her radio show was a decent show and not just a marketfest (as is frequently the case).  Since Vena broadcasts on a public radio station she also observes a strict policy against marketing while on the air.  Yes, she invites gurus to speak---but since it's public radio, even she doesn't market on the air.  A guru can reference their website or give contact information, but not sales pitches.  (She does announce what events are happening with the Cincinatti real estate club---but the club is also a non profit).

How important is her radio show?  And how important is she as a "hub"?  Here's how I would measure it----Peter Fortunato generally has a policy against audio recordings of his shows.  

I think he has enforced that policy with sdcia (as I recall).

He didn't do that with Vena---she is the only radio host to get him to talk for an hour for free.  I'm just saying, she is well known and has been around forever.
Just saying.

Anyway, even though she sells her own guru type wholesaler materials, they aren't outrageously priced----and, she makes it plain she doesn't disagree with the concept of being a real estate guru or capitalism per se.  This is primarily a rant against those who exploit unsuspecting newbies, charge outrageous fees and don't deliver on content.

She also tends to recommend the kind of relatively inexpensive programs that are sponsored by REIAs----they usually don't charge outrageously for their newbie type programs.  (The recent courses by sdcia aimed at beginners, for example, were very reasonably priced---although I live too far away to attend.)

One of the more interesting things about it is that she gives a thumbnail history of the real estate guruhood----which is worth reading it for that reason alone.  (And she starts with Bill Nickerson's over 500 page tome---How I Turned $1,000 into 1 Million in My Spare Time----which is definitely one of the greatest real estate books ever written.)

I didn't know Al Lowry was one of the inventors of the real estate guru format---but, FYI---I would NEVER go to one of his talks---get his material on ebay if you must (I wouldn't recommend it), I hear that it NEVER changes.

Vena also publishes a disclaimer at the beginning of her Guru Manifestor, including a "hypocrisy alert" that (1) she sells guru materials, albeit at more reasonable prices and (2) She has learned alot from reputable gurus, so she isn't rejecting the entire industry, just those who are exploiters of inexperienced real estate students and (3) she typically attends like 20 guru classes a year, so she isn't trying to blackball the entire industry.

Whom does recommend?  She mentions in footnote that she recommends:
1. Jack Miller--on any subject-- (now deceased, she wrote this in 2014)
2. John Schaub---on any subject
3. Peter Fortunato---on any subject
4. Dyches Boddiford---on any subject.
5. John Hyre on taxes
6. Jerry Fink on rehab (he's a local guy in the Cincinnati club)
7. Missy Mccall Hammonds on landlording (also local)
8. Wendy Patton on Lease Options.

I'm not overly familiar with the guys who are locals (#6 and #7), but otherwise I have no disagreement with anyone on her list.  

She also divides her list into the first 4----"they can teach me anything" group of sterling teachers---and the remainder.  And I totally agree with that.

And I totally agree that Wendy Patton has been teaching lease options for at least a couple decades and well worth listening to.

Anyway, without further ado:

http://gurumanifesto.com/_download/guru-manifesto.pdf

She gives away the manifesto for free on her website for free.

You can also download her radio programs for free, real life real estate radio, on her website.

Part of her message is that these real estate guru dog and pony shows have gone on steroids lately and seem to be out of control---and she wants to advise some serious caution.  The incredible # of reality tv type shows that have suddenly spawned with hosts who are strong on Hollywood good looks and very short on real world experience is one warning sign.
(My rule of thumb---if it even mentions the word "flipping"----run away!  Keep in mind that Armando Montelongo, the host of A & E's program "Flip This House" was arrested---and was sued by 164 of his former students.  In short, the multiplication of these type of programs have led to clueless hosts who have exploited the public, etc.
rickencin

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Reply with quote  #2 
I skimmed through "The Guru Manifesto: How to Avoid Real Estate Education Ripoffs and Learn What You Need to Know to Make Millions in the Most Proven Investment in America Today".  In true upsell tradition it has an almost complete lack of information on real estate investing.  She mentions buzzwords: "wholesale, retail, landlord or lease/option, or whether you’re into single families, apartments, raw land, commercial properties, condos, or mobile homes" but doesn't define them.  I didn't notice much mentioning of borrowing money.  Who does that?  No mention of my favorite hot buttons "CAP rate" and "ROI".  Real estate investing requires written, legal contracts.  No mention of them.  How about "buy low, sell high"?  Real estate investing IS scary.  You stand to lose just as much money as you gain.  If a house has tens of thousands of dollars of undisclosed damage that was cosmetically covered up, people WILL go get a lawyer and sue.  Even if the seller did nothing wrong.  Somebody has got to lose and it ain't going to be them.  Remember the guy who sold a used $40 printer and ended up with a judgment against him for $30,000 (for failing to answer requests for admissions"?  Not "What You Need to Know to Make Millions in the Most Proven Investment in America Today"    
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larrywww

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Reply with quote  #3 
The way I read the Manifesto is that it's not intended to be an outline of newbie education, but just some basic points about of caution if you are new to investing and are inclined to buy these guru type courses---so that you won't get taken advantage of.  That's it---nothing more.

The idea is that there are alot of dishonest gurus around these days whose primary aim is to fleece newbies and not educate------so newer investors should exercise some caution.

I don't see that as particularly controversial---and Yes, I do think it is factual and real.  I am astonished at the # of reality tv shows---and they aren't going to fold their tents even as the market for flipping significantly retreats.  

I think as real estate investors like Vena get older----they just want to warn newer investors not to get fleeced.  There may be some hype behind the posting---and maybe it was also for marketing reasons, I don't know.  I think it's a worthwhile message and that's why I posted it---it's not something I or any experienced investor would need to be warned against.

Also, I tend to think of Vena Cox as honest and a straight shooter, but it's not like I've been tempted to buy her guru stuff, etc.

Vena isn't on my list of the real estate experts whose courses I tend to follow--and Vena's chosen experts listed above seems to me to be a pretty good list (even though I can't vouch for her local experts).   These are the only experts whose courses I would buy---or recommend others to buy.

But, at the very least, I think her radio show is honest and not a marketfest---and that's free.
rickencin

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Reply with quote  #4 
She should have left the title at ""The Guru Manifesto: How to Avoid Real Estate Education Ripoffs".  I've presented below what I consider somewhat useful, actual comments for the beginner real estate investor.  Actual content, not hype.

Starting your Real Estate Investing education.  Amazon.com has many $20 books on specific aspects of real estate investing.  Even buying a dozen of them wouldn’t hurt you too badly.  Read each one before you decide to get the next one.  Don’t go to a $3,000 real estate seminar because you are too lazy to read a book.  Expectations, goals, plans, actions.  “Requires Action” is the final step.  Otherwise you are just an education junkie. 

Real estate investing can be classified into two subjects: One time revenue and recurring revenue.  (Observation, classification, hypothesis and testing).  Flipping is the classic one time revenue.  You buy low, from a motivated seller and sell high to a (motivated) buyer.  Flipping to a wholesaler is not a beginner transaction.  Wholesalers aren’t particularly interested in leaving room for your profit.  Each transaction could come with a 6% real estate commission, usually paid by the seller.  Real estate varies across the nation.  All real estate agreements must be in writing. Contracts are important.  If you get a real estate license and do the buying and selling yourself, you can save quite a bit of money.  You would need a broker to work for, until you become a broker.  You can go the buy “subject to” and sell lease/option route.  Buying “subject to” most likely violates the “Due On Sale” clause of an existing mortgage.  The insurance company isn’t going to like it either.  Learn about “land trusts” which seem to be declining in popularity.  Too many consumer protection laws these days.  Hence the sketchy reputation of “no money down” real estate investors.  Or you can get a “hard money” loan and buy a property, fix it up and sell it.  Hard money lending is based on the equity in the property and not the credit worthiness of the buyer.  It is expensive money and has high fees as the hard money lender needs to thoroughly investigate the deal and could get stuck with a lemon.  Realistically you should be a contractor or have decades of experience in the building trades to do this.  You should know workers who will work for about 1/3 of retail.  If you don’t have this experience start out with cheap, “pretty houses” from motivated sellers that require little work.  Remember “buy low”?  Remember how the car dealer beat you up on your trade in?  Take on more as your experience level grows. 

The other kind of real estate investing involves recurring revenue, also called “buy and hold”.  Of course, you want to eventually sell for a profit.  So you have both one time and recurring income.  You want to have positive cash flow on the property.  At a minimum this involves mortgage payments, taxes, insurance, repairs and a vacancy allowance (10%).  You can look at the recurring annual net return as a percentage of the cost of the house as if you paid cash for it (no mortgage).  This is CAP rate.  Or you can look at the annual net return as a percentage of the down payment and include the mortgage in the expenses.  This is called Return On Investment (ROI).  So a $200,000 house with 20% down (leverage of 5), a 3.5% mortgage, 30 years fixed, a rent of $1,500 and about $400 in other expenses would have a CAP ($11,300/$200,00) of 5.6% and an ROI ($2,678/$40,000) of 6.7%.  You can only know the true CAP and ROI in hindsight.  Future CAP and ROI are just paper estimates.  Still, since it is all about making money a 5.6% CAP is better than a 3.0% CAP all things being equal.  CAP rates vary from 1% (very expensive areas that are hard to rent) to 15% (cheap garbage in war zones).  Where you chose to invest determines your prevailing CAP.  It’s all about the moola.  ROI is interesting, but since it reflects leverage it can be sky high.  If you get a $0 down deal and make $1 a year, you have an infinite ROI rate.  Big deal, I can make as much with a $1 off coupon at McDonalds.  This might be a 2% CAP rate.  Beware of really high claims of ROI or “cash on cash” return without a specified CAP rate as well.  Start out with low risk/low return deals until your experience level grows.  Low return often happens even if you didn’t plan it that way. 


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Rick
larrywww

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Reply with quote  #5 
If someone wanted an introduction to real estate investment the following book is free on kindle (Caveat: I've never read it):

BiggerPockets Presents: The Ultimate Beginner's Guide to Real Estate Investing Kindle Edition


Also the following books (by one of the authors) are free--or almost free---on kindle.

This book costs 99 cents. 

Product Details
 

How We Bought a 24-Unit Apartment Building for (Almost) No Money Down: A BiggerPockets QuickTip Book

Feb 4, 2015

Kindle Edition

Auto-delivered wirelessly
Product Details
 

A BiggerPockets Guide: How to Rent Your House

Jan 5, 2013

Kindle Edition

Auto-delivered wirelessly


larrywww

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Reply with quote  #6 
Actually, I am informed that getting the "free" books may require some preconditions.  The book is a promotion for the website, bigger pockets, and requires one to register and perhaps other things.

mks_97

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Reply with quote  #7 
I recently met Dyches Boddiford at a cruise/RE seminar. I was really impressed with his knowledge and his ability to articulate his thoughts. He lives in the Atlanta area, so a lot of his creative financing techniques may not be as applicable in CA. Very knowledgeable in the areas of Asset Protection, Taxes, Self Directed IRA etc.

Pete was also on this cruise/RE Seminar. His passion for RE and educating folks is unbelievable. He'd be up till 2 am talking with students and answering their questions. I do have a tough time understanding his deals but that could just be me.

I have noticed that a  lot of the educators/investors from the Florida/Georgia area don't bother looking at traditional financing. In fact they just won't deal with banks. They focus on seller financing or private money (read self directed IRA money from a fellow investor, no points, 6-8% interest rate). Its a lot harder to get this kind of financing in San Diego since the purchase price is a lot higher. They also exchange a lot of properties with fellow investors. Not sure if that happens in San Diego. Maybe something to do with price again?

Thanks rickencin for simplifying RE investing for all of us. Another way to get a great ROI (or cash on cash return as I refer to it) is to refi after appreciation. If you were to refi the properties bought during the downturn, you are probably playing with the banks money (i.e. you would have managed to pull all your cash out even at 70%LTV). Now your ROI is pretty high. 

Another useful metric is ROE (return on Equity). It is nice to have equity in the property but how are you able to monetize that equity? If rents are not keeping pace with price appreciation, then the equity you have in the property is not really working for you. One way to address that is to do a cash out refi and use the funds for other investments.

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