Jason Hartman - October 2019

Jason Hartman's Financial Freedom Report

The Godfather of Real Estate Investing What Today’s Investors Can Learn From William Nickerson

A vital part of being successful in the real estate investment business is continuing education. That’s why I’m so committed to offering opportunities like workshops, networking events, podcasts, and online courses to my fellow investors. It’s also the reason I’m often seen with a business book in hand. Though I’ve read a plethora of guides to gaining wealth, one of my all-time favorites is what you might call the original book on real estate investing: William Nickerson’s “How I Turned $1,000 Into a Million in Real Estate in My Spare Time.” By the time Nickerson passed away in 1999, he was widely considered the godfather of real estate investing, and his wisdom

Time” a blast from the past (I remember feeling faint the first time I read about Nickerson worrying over the financial risk of buying a $7,000 house, and his suggestion of scoping out classified ads in the newspaper is laughable in the internet age) but it’s also full of well-thought-out lessons from a man who made millions in real estate before it was a popular route to riches. In later editions, the “a Million” part of the title was changed to “Five Million” to reflect Nickerson’s steadily increasing wealth, which in itself is a solid endorsement. Nickerson’s strategy was to start by investing in a small property, and then use the appreciation, principal paydown, and cash flow to buy larger and larger properties. For example, he advised investors start by purchasing a single-family home then scale up by adding a small apartment complex, a medium-sized apartment complex, and so on to their portfolios. Andrew Syrios of BiggerPockets calls this “the ultimate get-rich-slow scheme,” writing that Nickerson’s story shows how important it is “to keep the long-term perspective in mind.” Nickerson’s success was also proof that anyone, regardless of their background, can make a profit by investing in real estate as long as they have a well- thought-out strategy. He graduated from Fresno State with a double major in English and psychology and then went on to sell hosiery and telephone service before beginning to buy houses — far from the business degree/MBA route one might expect a millionaire investor to follow. As someone who left college without a degree, I identify with Nickerson’s story about taking his own path to the top. From those humble beginnings, Nickerson went on to make millions of dollars and write a total of five books on real estate investment, including

Jason's High Five

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Mortgage Payment

$1,250

$1,280

Probability of a recession

34.8%

35%

S&P 500

is still relevant today. Here’s a solid piece of investment advice: Don’t think about picking up the latest Robert Kiyosaki until you’ve gone to the source — William Nickerson’s 1959 debut. Not only is “How I Turned $1,000 into a Million in Real Estate in My Spare

3,007

2,977

Job growth

136,000

168,000

Wages (year-over-year)

3.5%

3.6%

"DON’T THINK ABOUT PICKING UP THE LATEST ROBERT KIYOSAKI UNTIL YOU’VE GONE TO THE SOURCE — WILLIAM NICKERSON’S 1959 DEBUT. "

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