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

This Month Last Month

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. "

CONTINUED ON PG. 3 ...

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October 2019

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Don’t Let Money Get in the Way Of Your Grandchild’s Education

College expenses aren’t what they used to be. What used to be affordable to any student with a part-time summer job now can take years to pay off. If your grandkids want to go to college, the cost of education should not be a barrier to their future. Luckily there are ways that you can help ease that financial burden. There are no limits on age, income, or monetary contributions attached to this college savings account, and contributions are tax-deductible in some states. Just like a Roth IRA, the earnings grow over time and can be used tax-free for qualifying expenses, like tuition and room and board. There are a few downsides, however. Funds from a grandparent’s 529 savings plan are considered student income and could hurt your student’s eligibility for financial aid. If you choose to fund through a parent’s 529 savings plan, which doesn’t count as student income, you Invest in a 529 savings plan. According to PERE, in January, European investors were poised to be the most bullish faction in the real estate market this year. A joint survey conducted by real estate groups around the world found that 91.6% of European investors were eager to expand their holdings, compared with 55.3% of North American investors and 35.5% of those in the Asia-Pacific. Despite appearances, this is actually good news for the American real estate market — which happens to be the preferred playground for European investors. That preference stems from the fact that European real estate markets move slower than those in America, held in check by government interference, a pervasive stay-in-one-place mentality (The Atlantic reports that the average American moves almost three times more frequently than the average European), and barriers to fluidity like variations on currency, tax, and language from place to place.

lose control over the funds you contribute.

Pay their tuition.

Not everybody has $20,000 just lying around, but if you do, using it to pay for your grandchild’s tuition isn’t a bad way to spend it. Normally, annual financial gifts that are exempt from the federal gift tax can’t exceed $15,000, but payments toward someone’s tuition, for any amount, are not taxed. Keep in mind, however,

that the money can only go toward tuition, not toward other college expenses like room and board or textbooks.

thousands of available scholarships, grants, and programs to help students pay for college, and helping them look online and in your community can go a long way. College could be your grandchild's first stop on the path to achieving their dreams. You can be a part of that journey by making sure money doesn’t get in the way of that.

Help them find opportunities to save.

Even if you don’t have thousands of dollars to give, you can still help your grandkids look for other opportunities to save. There are

The Fluidity Factor

Why European Investors Favor U.S. Markets

All of those factors cause friction in the market, making the comparatively volatile U.S. an attractive option by comparison. It’s true that the dollar volume of homes purchased in America by foreign investors dropped significantly from April 2018 through March 2019 as compared to the previous year — a full 36% according to the National Association of Realtors — but the majority of that exodus was made up of Chinese, Canadian, Asian-Indian, and Mexican buyers. Chinese investment alone fell 56%, a statistic that Chinese real estate investment website Juwai. com chalked up to the current political climate in a CNBC interview. With the exception of the U.K., which has seen a slight drop in investment that could be attributed to its own political turmoil over Brexit, European investment in the U.S. real estate market remains strong. Across asset classes, the U.S. is the largest recipient of foreign

investment on the planet, and, as the most historically proven asset class there is, it’s no surprise that real estate remains the market of choice for a large share of those funds. When it comes to investing across the pond from a home base in the U.S., however, do so at your own risk — or at least with an experienced investment company like Jason Hartman in your pocket.

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Looking for a New Investment Opportunity?

Property in Atlanta Is Ready to Go

The Atlanta, Georgia, real estate market is incredibly attractive for real investment, and Jason Hartman secured a limited number of properties there ripe for the picking. Our local market specialist recently purchased an off- market land contract that allows us to control an Atlanta neighborhood, including the homeowners’ association (HOA). Each property in the parcel features all-new construction and a 2-10 Home Buyers Warranty, with cash-on-cash returns estimated at around 10%. Now is the ideal time to invest in Atlanta real estate, which has rapidly increased in value along with the growth of the city’s population. In April of this year, the U.S. Census Bureau revealed that Atlanta had the fourth-highest population growth in the country from 2017 to 2018, gaining 1.29% in that time. The Bureau of Labor Statistics doubled down on that trajectory in June when it announced that the local rate of employment growth in Atlanta was above the national average, rising 1.9% from the same month last year, .4% more than the country as a whole. “Nickerson’s No-Risk Way to Real Estate Fortunes,” and “How to Make a Fortune Today Starting From Scratch.” His work is well-worth reading, and the outdated numbers ($27.50 once covered “furniture and furnishings,” apparently) are as entertaining as his processes. That said, you’d be doing yourself a disservice if you stopped your continuing education with Nickerson. Real estate investors like me have learned so much more over the last few decades, and you can find thousands of resources like workshop sign-ups, podcasts, and online courses on my website, JasonHartman.com. If you’re not sure where to start, call 1-800-HARTMAN today. Whether you’re just starting out or simply want to continue adding to your portfolio, my team and I can point you in the right direction. –Jason Hartman ... CONTINUED FROM COVER

As U.S. News and World Report puts it, “The Georgia capital is attracting newcomers from around the country, and people are looking to this part of the country for culture and commerce like never before. If you learn about everything Atlanta has to offer, it's easy to see why. Atlanta features award-winning restaurants and chefs, iconic locales that rival any across the country — including the Tony Award-winning Alliance

Theatre, the CNN Center, and the Western Hemisphere's largest indoor aquarium.”

If you’re interested in investing in these new Atlanta properties and reaping the many benefits they have to offer, reach out to us at JasonHartman.com/Contact or speak to your investment counselor today.

Are you ready to build your fortune? It’s time you invested in real estate. Visit JasonHartman.com or call 1-800-HARTMAN today to schedule a free consultation, shop properties, sign up for events, explore thousands of investor-specific resources, and learn from Platinum Properties Investor Network Founder Jason Hartman himself about how to accumulate wealth through real estate, the world’s most stable multi-dimensional asset class.

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INSIDE THIS ISSUE

The Godfather of Real Estate Investing

3 Strategies for Helping Grandkids Pay for College

Why European Investors Favor U.S. Markets

Atlanta Is Ripe for Investment

Ready To Build Your Fortune?

Spotted with Hartman Who Did Jason Meet This Time? On a good day, the real estate investment business can be as fun as it is lucrative. Over my years of investing, I’ve been lucky enough to travel the world extensively and meet people from all walks of life — some more well-known than others! In this section of my newsletter, you’ll find snapshots from some of my travels. How many of my new friends do you recognize? –Jason Hartman

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