Quora: What are the quickest ways to accumulate wealth?

https://www.quora.com/What-are-the-quickest-ways-to-accumulate-wealth-1/answer/John-Kwon-24?srid=nmK

Something my Broker told me back in ’86 when I first got my real estate license. In United States, a person can buy a house with as little as 3% down payment! Its called a FHA loan and there are few stipulations. You must have decent credit score, make enough income to pay the loan payment plus living expense plus live in the house at least first year. My broker advised me not to buy the pretty yellow house with white picket fence. Instead, buy a 4 unit apartment (maximum size still qualify for FHA loan), live in one unit and rent the rest. At that time, a 4 unit apt was selling for $225K (in Los Angeles) so a person with $7k-$8k cash could buy the property. Live in the apt for a year then purchase another 4 unit and live in the new property. The rental income will pay for the loan payment of the previous apt. Because rental income rises over time, you can payoff the loan in 20 years. At age 25, if a person bought the first 4 unit apt, at age 45, the loan will be paid off and you can receive rental income of $60,000 per year! At age 46, the second apt will be paid off so your rental income increases to $120,000 per year! At age 65, your rental income will be $1,200,000 per year! Granted most people cannot and will not purchase a 4 unit apt every year. Plus, eventually, you will own so many apt buildings, either you have to quit your job and be a full time landlord, or hire property mgmt company and pay fees. If you have close knit family, you and siblings can contribute $2,000 each and purchase the 4 unit apt. Your semi retired Dad can manage the rental units. After couple decades, your family will be wealthy and perhaps have stronger bond…

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OMG, you drunk??? Fearless Leader advocating multi unit investing (granted non rent controlled ideally) for once…

Hey, I was never against multi-fam the whole category. Just make sure you don’t buy it in Bay Area.

But… LA does have rent control, right??

At least with the Bay Area, the economy is fairly resilient and diversified that one can weather most storms and still be mostly occupied even in the worst of times. Half the battle is won with less turnover and expenses. No one ever said being a landlord was a quick riches scheme…

True. Maybe I am just not cut out to be a multi-fam investor. :smile:

Quickest way?
You drive the getaway car and I will tell you how.

For investment, buy, hold, earn like dividend returns, multi-unit is the best way. Long time before, my realtor suggested me to go for it as this is cash cow.

For early returns, flipping is best and SFH will provide great returns for such flips.

But, both are great when it is in good location where population is growing.

Bitcoin in the last 5 years

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Ether in the past year.

What will it be in the next year?

If only I had a crystal ball… :joy:

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https://www.bloomberg.com/news/articles/2017-11-20/billionaire-landlord-finds-fortune-in-nyc-s-gentrification-boom

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You need to be lucky sometimes.

http://www.msn.com/en-us/money/markets/selling-an-old-blanket-hed-thought-was-worthless-made-this-man-dollar15-million/ar-BBFrHKL?li=BBnb7Kz&ocid=ue01dhp

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LA does have rent control, but most of the smaller cities nearby do not have that. I guess the author casually failed to mention that the broker told him not to buy in LA after telling him to go buy a 4-plex.

Man, I was in LA yesterday for work, way busier than ever…

Wiener grew up in Brooklyn where he worked as a lawyer before joining the family’s real estate business. In the 1990s, he set out on his own and focused Pinnacle’s business model on buying rent-regulated, run-down properties that house many tenants behind on their rent. He then often extensively renovates the buildings, which allows him to raise rents legally to cover some of the expense, according to Fisher.

Solid game plan. Anyone following the same methodology?

I always buy value add properties… Sometimes I renovate sometimes I just let the market do the heavy lifting. I think the place to renovate now is Oakland… buy commercial non rent controlled buildings and convert to apartments… Non rent controlled units in a rent control town cha ching…

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What’s a non rent controlled commercial building? Are you talking about non residential warehouses?

He was a lawyer. Not sure how much you need to spend on legal fees in lawyer fested California and Bay Area.

NYC is much sober than BA