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STARS & STRIPES
HEARTLAND INVESTMENT COMPANIES
FEBRUARY 2020
DARINGARMAN.COM 319-350-5378
THE SECRETS TO A HAPPY MARRIAGE
(AND A SUCCESSFUL INVESTMENT PARTNERSHIP)
When our anniversary rolls around this June, my wife Gina and I will celebrate 31 years of marriage. It’s hard to believe we’ve been together for that long — sometimes it seems like only yesterday when she shot down my movie date proposal in eighth grade — but there’s no denying that our relationship has grown stronger over the decades. This month, with Valentine’s Day coming up, I’ve been thinking a lot about relationships. Of course, that means I’ve been thinking about my lovely wife, but I’ve also been considering what the secret is to relationships in general, like the ones I have with my kids, my friends, and the investors I work with at Heartland every day. In the end, I think every successful partnership comes down to two things: trust and communication. The first “secret,” trust, may seem obvious, but it’s by far the biggest factor in a strong relationship. There’s no way Gina and I would have made it this far, raising three kids and taking all of life’s punches, if we didn’t trust each other. And if I really boil down my relationships with investors, taking out factors like personal wealth and income, the reason they’ve invested tens of millions of dollars with me over the years is because they trust me. In fact, when he was writing about his Iowa investments in his book, one of my clients said something like this: “I have apartment holdings in Iowa that I’ve never been to and I’ve never looked at, but I have a guy in Iowa I invest with whom I trust, and that’s why they’re there.” I’d bet it’s the same story with 95% of my clients, most who live out of state and leave it to me to handle the day- to-day work of managing their properties. To put it simply, if they couldn’t trust me, I wouldn’t be in business! I feel like the second secret, communication, doesn’t get enough credit in most relationships. Communication is vital so both parties always know where they stand and so no hiccup, no matter how small, goes unnoticed and unaddressed. I tell all of my investment partners (and Gina!) the good news and the bad news, and even more importantly, we’re constantly in touch. Open lines of communication reinforce trust. I’m always calling or emailing my
“IN THE END, I THINK EVERY SUCCESSFUL PARTNERSHIP COMES DOWN TO TWO THINGS: TRUST AND COMMUNICATION.”
investors to update them on the latest developments with their properties and make a point to take time to address any problems, questions, or concerns that come up. Not only is it good customer service, but it’s also good manners, period. At the end of the day, Iowa isn’t the sexiest place to invest in (and I’m probably not the sexiest man my wife could have found), but I’d say we’re both consistent, trustworthy bets, and that’s what matters most.
–Darin Garman
P.S. - Look forward to the results of last month’s bald eagle photo contest in our next edition!
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DON’T LET SCAMMERS GET YOU DOWN
PROTECT YOURSELF AND YOUR MONEY
Over the last 12–14 months, investor demand for apartment investments has been high, thanks in large part to low interest rate financing. As of this publication, rates are running from 3.75%–4.25% and can be fixed for 3–10 years, with terms ranging from 3–30 years. So, how does this impact the value of apartment communities? Simply put, the lower the interest rate, the lower the loan payment. And the lower the loan payment for an investor, the more the investor can afford to finance — meaning they can pay more for the property. For example, if you got a $500,000 loan at 6% with a 30-year amortization, your loan payment would be $2,997.75 per month. However, if your interest rate was 3.75%, your loan payment would be $2,315.58 per month. That’s a FULL $600 less per month! Theoretically, that means if you have a target income and return in mind, then you can afford to pay $60,000–$80,000 more for the property with the 3.75% rate than with the 6% rate to hit your target income and return. For the owners and sellers of apartment communities, this translates to getting an additional $60,000–$80,000 in sales when interest rates are low. Think about that for a second. Without any extra time, effort, energy, work, According to a recent survey by the American International Group (AIG), a majority of Americans over the age of 65 don’t know much about the myriad financial scams circling the globe. Reports show that ignorance of these scams has proven costly for the 65-plus crowd, who are the most frequently targeted demographic. IS IT LOVE? One common shakedown taking seniors and retirees for a ride is the online romance scam. As part of it, a person poses as a potential date or romantic partner and engages in a fake relationship with the victim. The scam usually starts with an online or web-based dating service and progresses to texting or talking over the phone, but it always stops short of an in-person meeting. Instead, after the scammer has gained the trust of their victim, they’ll claim there’s been some kind of emergency for which they need money fast. The clueless victim usually offers to wire them the money. In many cases, the scammer will continue asking for money for as long as they can get away with it. Then, once the victim figures they’ve been bamboozled and try to retaliate, the scammers vanish — off to find their next target. DID YOU PAY? Another prevalent rip-off is the invoice scam. Again, AIG reports that about 57% of people aged 65-plus aren’t familiar with this sham. In most cases, the victim receives a phone call or email from a representative of a local company, who says they still owe money for a bill or service. For example, HAPPENINGS AT HEARTLAND
the scammer may tell the victim they owe an overdue $50 for their power bill. If the victim says they’ve already paid, the scammer might respond, “Your payment didn’t process correctly.” The crook’s job is to get the victim to relent and pay up. Then, once they’ve been paid, usually via credit card number or wire transfer, the scammer once again vanishes along with a significant portion of someone’s bank account. Scammers want your money, but if you are aware of today’s hustles, you can better protect yourself and your assets. Luckily, AIG also found that nearly 92% of the 65-plus crowd now ignores phone calls, texts, and emails that
request personal information, and 89% of these folks say they avoid clicking links from unknown senders. Be vigilant and remember that if someone calls you and demands personal information over the phone or asks you to wire money, there’s a very good chance it’s a scam.
INTEREST RATES ARE ‘BORING’ — UNTIL THEY MAKE YOU MONEY
or capital improvements, you can get an additional $80,000 at the closing table, all because of low interest rates! This is one reason why many “experts” and real estate brokers are urging their clients to sell their multifamily properties. Low interest rates mean they can command high prices that will be out of reach if
and when rates climb higher. Darin is certain rates will climb (they always do), but for now, the FED’s actions are keeping interest rates low, and they likely will for another year or more. That’s why, looking into what he jokingly calls “Garman’s Crystal Ball,” Darin sees apartment community values growing even more over the next year and possibly beyond. So, next time you hear talk of the FED lowering or raising interest rates, keep in mind that every time rates go down, apartment values rise. Every time rates go up, values could start to level off and then turn in the other direction. It is a wise move for passive and active apartment community owners alike to keep an eye on rates and judge how well their properties are doing. Of course, our team can keep you informed of what’s going on behind the scenes. If you have questions about interest rates, contact Darin today!
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I WA LIFE
SUDOKU
HAPPY PRESIDENTS DAY FROM THE HAWKEYE STATE!
A LOOK BACK AT IOWA’S PRESIDENTIAL HISTORY
When it comes to politics, Iowa is probably best known as the first state to vote in presidential primary elections. That status dates back to 1972, and this year, Iowans head out to caucus for the Democratic primary on Feb. 3, kicking off the 2020 presidential election. That said, leading the way in the primaries isn’t the only way Iowa has contributed to U.S. presidential history. With Presidents Day falling this month, we thought it would be only appropriate to take a look back at the U.S. presidents and vice presidents who have called Iowa home, including President Herbert Hoover, President Ronald Reagan, and Vice President Henry Wallace. According to Travel Iowa, President Herbert Hoover once said, “I am proud to have been born in Iowa. Through the eyes of a 10-year-old boy, it was a place of adventure and daily discoveries.” Hoover lived in the Hawkeye State as a child before moving to Oregon, and the small home he was born in is preserved as part of the Herbert Hoover National Historic Site in West Branch, which also hosts his presidential library, his grave, and more. Travel Iowa also reports that President Ronald Reagan lived in Iowa before he was ever elected for office. In the 1930s, as a fresh-faced college graduate, Reagan moved to Des Moines to work as a sports broadcaster for WHO radio. In fact, it was an interview with an actress Reagan did for WHO that gave him the idea to move to Hollywood, where he became an actor, then the state’s governor, and finally the country’s president. Last but not least in Iowa’s history is Henry Wallace, who served as Secretary of Commerce, Secretary of Agriculture, and Vice President to Franklin D. Roosevelt. Wallace was a true Iowa native, born in the tiny town of Orient and educated at Iowa State University, where Senate.gov reports he studied plant genetics and crossbreeding, even patenting his own strain of corn. His achievement in government, particularly agricultural policy, left a lasting mark on the nation. In 1999, he was named the “Most Influential Iowan of the 20th Century.” Today, visitors to Orient can tour The Wallace Centers of Iowa, an outdoor interpretive site located on the farm where Wallace was born.
APARTMENT SALES AND SUCCESS
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CONTACT DARIN TODAY AT 319-350-5378 FOR MORE INFORMATION ON THESE LISTINGS!
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HEARTLAND INVESTMENT COMPANIES
PRST STD US POSTAGE PAID BOISE, ID PERMIT 411
Darin Garman: Heartland’s Most Trusted Multi-Family Investment Advisor 2505 Silver Oak Trail Marion, IA 52302 DarinGarman.com 319-350-5378
INSIDE Page 1
The Secrets to a Happy Marriage
Page 2 Don’t Let These Scammers Steal Your Money The Money Making Power of ‘Boring’ Interest Rates
Page 3 A Look Back at Iowa’s Presidential History
Page 4 Important Tech Trends for Small Businesses to Keep Up With
The line between technologies that are beneficial for large businesses and those beneficial for small businesses continues to blur. While the latest software programs were once only available to large companies that could afford them, some of these programs have also become available and profitable for small businesses to use. In an age of increasing connectivity, these are a few tech trends that small businesses should watch out for. 3 TECH TRENDS TO ACCELERATE YOUR COMPANY KEEP UP WITH THE BIG BUSINESSES
CONTINUED RELIANCE ON SOCIAL MEDIA Social media marketing remains an effective tool for attracting customers to your small business, even if the tools continue to change. While marketing on Facebook and Instagram might seem like old news, marketing on trendier apps, like TikTok, Pinterest, or Snapchat, can still work to your business’s benefit. A recent study showed that 45% of consumers head to social media when they have a question about something — are you going to be there to answer it? Keeping up with the latest and greatest tech trends in small-business management can be exhausting, but in an age where technological advancement is accelerating faster than ever, it’s necessary for the survival of businesses of all shapes and sizes.
COLLABORATION WITH ARTIFICIAL INTELLIGENCE
While it certainly shouldn’t replace every customer interaction, using AI software programs for small tasks — like email marketing, data entry, accounting, and some low-stress forms of customer service — is invaluable to small businesses. Delegating menial tasks to AI can free up time for you to focus on those more important face-to-face interactions with your customers.
INCREASED USE OF DATA ANALYTICS
“Big data” is intimidating. For years, sifting through customer data and extracting valuable information that can be used to grow businesses was something that only the largest companies had the time, funds, and expertise to do. However, more programs that reduce the upfront investment and expertise necessary to contextualize customer data are popping up. If you can make use of your customers’ data, you can give them an experience with your business that they won’t find many other places.
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