Due diligence is always critical to success in real estate. It's even more important (albeit more difficult) when there's a pandemic still lingering about. On this episode of The Good Stewards Podcast - we discuss, take a long look at the essential art of due diligence.
So then they came for Thomas Jefferson, although at least this time the authorities had the tiniest bit of backbone. The SJW cultists were not happy. For example:
Yes, Thomas Jefferson owned slaves and slavery is very wrong. Let's tear down his statue... along with the Roman Coliseum, the Egyptian pyramids, the Mayan pyramids, the Great Wall of China and every other structure built by slaves as well as every statue of an ancient emperor or Medieval King or early modern leader who owned slaves or was a master of serfs or whatever.
Modern day figures you say? Well Winston Churchill was racist. How about anti-racists? Well, have you heard what Ghandi said about black people? How about antiracist blacks? Well, Martin Luther King Jr. was plagiarist and serial philanderer (and maybe worse).
People are flawed. History is ugly. What a revelation.
But even still, our history provides a glue to our civilization. It tells us who we were and where we came from and gives us all (including immigrants) a common history. Yes, if you have a truly evil man, like statues of Stalin in Eastern Europe after the fall of the Soviet Union, you should remove his statue. (The ongoing trainwreck in CHAZ seems to be further evidence you need something more than "solidarity" to hold a society together, even one that consists of only six square blocks.)
But Thomas Jefferson moved things forward, not backwards. He owned slaves, but at a time when slavery was often taken for granted, he wrote openly against and took steps to try and curtail it. And he was instrumental in moving the world from monarchy to republicanism. (And by the way, the "father of Sally Hemming's children" thing is a lie.)
Indeed, even with Confederates, tearing down their statues makes little sense. They are honored for their bravery and fighting for what they perceived to be their country, not for defending slavery. Again, history is ugly and slavery was par for the course around the world.
The great Civil War historian Shelby Foote puts it well in my mind about "the great compromise after the war,"
And there's a great compromise as it's called it consists of southerners admitting freely that it's probably best that the Union wasn't divided [and that slavery ended, of course] and the North admits rather freely that the South fought bravely for a cause and which had believed and that is a great compromise and we live with
This is unacceptable to the SJW culture warriors of BLM and Antifa though. No, just complete, total capitulation is acceptable. The past must be erased.
This draws parrellels not just to the Taliban and ISIS, who love to destroy statues and erase what came before because of it's heretical, errr, I mean racist. What most comes to mind would be the Jacobins.
During the French Revolution, the Jacobins throughout the old calendar and started over at Year One. Dissent was crushed and the "Reign of Terror" began that killed tens of thousands. During this "enlightenment," the Jacobins went so far as to behead statues. Sounds very rational... yet also familiar.
Or perhaps they sound more like the Khmer Rouge, whose leader Pol Pot called for an even more radical break from the past; going so far as to evacuate the cities. As I've noted earlier,
A French Catholic priest named Francois Ponchaud who lived in Cambodia during the 1970’s analogized the French Revolution’s call for breaking with the past to the Khmer Rouge. His book Year Zero catalogs the gruesome atrocities of that genocidal regime. Pol Pot and his henchman targeted any businessmen and landowner as well as monks, intellectuals, artists and teachers. They evacuated the cities and purged any traditional influence they could find. The idea was to destroy and replace all of Cambodia’s culture and tradition with a new “revolutionary culture.”
The Khmer Rouge killed approximately 2 million Cambodians.
There's nothing enlightened or progressive about rushing to tear down statues and monuments and let's be honest, erase history. When the activity you are engaged in is most reminiscent of Jacobins, communists and Jihadists, it's probably a good idea to just go ahead and stop.
Having a good property to lend on (or properties) and having good credit isn't always enough to get a bank to lend to you. And if you don't have those things or the economy is bad (like say, now), you will need to do even better. But it's not true that every bank is the same nor is it true that bankers just plug your financials and property into an equation and an answer pops out. Banks are different and you need to find the right one. And banking is still a people business, so you need to do some schmoozing (and get your accounting in order). For more, see my article on this subject here: https://www.biggerpockets.com/blog/5-... And stay tuned for our next video on how to convince a bank to approve your loan.
My newest piece for BiggerPockets: "Real Estate Due Diligence: 2 Critical Steps You Can’t Afford to Screw Up"
One bad deal can set you way, way back. A friend of mine once put it like this: 'One bad deal prevents you from doing the next 10.
And the No. 1 lesson to learn when it comes to all of our worst deals? In order to avoid such bad deals, you must do due diligence thoroughly and correctly.
My latest article for BiggerPockets on collections and delinquency. Something you need to figure out to be a successful property manager or buy and hold investor.
Collections, delinquency, and, in some cases, evictions, are the worst part of property management. But they are, unfortunately, part of it. You can’t escape them completely, so you need to figure out how to manage the process.
The first key things to do are to build systems and make policies."
So I've been on a bit of a writing tear of late. Here's my new BiggerPockets article, "A First-Time Landlord’s Guide to Setting Rent on a Property"
Remember, properties with a mortgage rarely have a large amount of cash flow. Oftentimes, it will be something close to $100/month. If you set your rent $100 too low, then your cash flow goes to zero. If you set it $100 to high, it might sit vacant for an extra month. In which case, if the property rents for $1,200/month, again, your cash flow for the year goes to zero.
So, how should a new landlord or property manager go about setting rents? Well, I'm glad you asked.
Due diligence is perhaps the most unfairly (and unwisely) ignored topics for real estate investors. Due diligence is when you verify what you think is true while a property is under contract. It includes third party inspections, examining the lease, rent roll, operating statements, etc. With apartments and office buildings, it's even more complicated. But it's something that you absolutely do not want to shortchange.
In this video, we give a brief primer on how to do it right.
Check it out!
My newest piece for BiggerPockets asks if we are in a recession and probably a bad one, why are real estate prices still rising?
The early data that came out right as the pandemic was starting to hit the United States were also misleading. Properties are usually under contract for at least 30 days before closing. Thus, the sales data from March came from properties with contracts signed in February, when COVID-19’s impact on the U.S. was minimal and many doubted it would become a serious problem.
But more importantly, there are two major reasons that real estate prices continue to rise:
[Unfortunately it probably won't last] ...it takes a long time for a default to become a foreclosure and for those foreclosures to begin dragging down the housing market. By some early (and in my opinion, overly pessimistic) predictions, mortgage holders are bracing for up to 15 million defaults.
While the number likely won’t be that high, it will still be high. Yes, inventory will remain low, but as people go into default or simply need to move, large numbers of properties will eventually hit the market. With reduced demand, this will put downward pressure on housing prices.
We're obviously in crazy times and definitely in a recession. Real estate prices haven't fallen yet, but they are almost bound to. So should new investors jump in, particularly with the BRRRR model? That's what my latest article covers.
My answer is: Wait a few months before starting to see how things go.
The big thing is to be more careful and demand better deals right now as we wade our way through this recession and all the economic uncertainty that surrounds us. You want to avoid risk in a volatile and likely falling market. And experience reduces risk. Unfortunately, experience is also something that new investors don’t have.
We are in the middle of a pandemic, or at least the tale end of one. That being said, we are also in the middle of a replication crisis in science. Furthermore, we seem to be in the middle of one social media/mainstream media-driven moral panic after another. One of those seems to be the collective overreaction to Covid-19.
And it appears these things are all related.
You can find the link to Retraction Watch's list of retracted Coronavirus papers here.
Of course, you would expect there to be some, but 15 is a lot. And that doesn't even include flawed or misleading papers, just retracted ones. It would appear the rush to publish during a quick-moving, panic-inducing event like a global pandemic made scientific standards much worse (and they're struggling already). Add in a hysterical mainstream press and an even more hysterical groups of social justice-minded social media users and you have the recipe for really, really bad public policy.
Which just so happens to be what we got.
"Every day is a new life to the wise man."
The Righteous Mind
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