FEATURED STORY
Master Investor
aging partner and one of the owners of the 50-employee firm. It’s in four markets now and looking to expand. Larson’s story shows that real estate in- vestment success can be found by relent- lessly focusing on doing one thing well. WEANED ON REAL ESTATE Sometimes it seems like someone was born to be in a certain profession. Larson may be one of those people. His late teen years were spent helping his uncles rehab houses in Detroit. He says the “cheap labor” he provided his uncles after school and during summer vacations gave him an opportunity to learn the real estate business at an age when most of his peers weren’t getting a “career preview.”
Diving into the industry headfirst, Lar- son obtained his real estate license in his early 20s and, with his father, started buy- ing and flipping houses. “Being an agent, I would help him find the deals and write the offers,” he says. “I really got to learn how a real estate transaction worked. Then he and I would go in and do the renovation for the homes, and I would list the house on the MLS to a retail buyer.” Larson quickly discovered that he en- joyed two aspects of his budding real es- tate career: working with investors and the fact real estate was different from other assets. “I looked at it as a better option than the traditional investments that are out there like stocks and bonds and mutual funds and things of that nature,” Larson says. “I felt like with real estate you could control it more. It was an insured asset. It was tangible.” He and his family started buying houses when the market soured, reasoning that it couldn’t “continue to plummet,” Larson says. They’d buy the houses for $5,000 to $20,000, put $20,000 into a renovation and rent them out for between $700 and $900 month. This was how Larson became experienced with Class C inventory. The experience wasn’t entirely positive. “At the time, it made sense because we were able to buy properties so cheaply, and we were able to rent them out at a very attractive rate where we were seeing some really solid cash flow,” he says. “But I learned quickly how tough it was to manage that type of inventory.” The “headaches” of dealing with the Sec- tion 8 program and managing properties in areas where he didn’t feel physically safe told him it was time to exit the market. He made a nice profit on the homes when he sold them in 2011.
SOMETIMES SUCCESSFUL real estate investors stretch themselves too thin by trying to be involved in too many types of investments. This “jack of all trades, master of none” approach may work for some investors, but it can also bring stress and poor returns. Other investors stick to one asset class and become experts. John Larson, Think Realty’s May/June 2017 Master Investor, has found success by sticking to the investment classes he knows will provide solid returns for clients of his company, American Real Estate Invest- ments (AREI). Dallas-based AREI provides turnkey rental portfolios for investors looking to build cash flow. The company purchases houses, rehabs them, finds tenants and manages the properties. Larson is a man-
WELL-SUITED FOR REAL ESTATE INVESTING Larson says that several of his per- sonality traits make him ideally suited
Above: Larson and members of the AREI team confer. At right, Marcus Reynolds, senior investment coordinator, greets a client.
20 | think realty magazine may :: june 2017
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