Full Description

Retire Rich from Real Estate teaches readers how to buy real estate that will build wealth over time and secure their retirement. It provides specific information on such matters as how to choose prime investors based on demographics; choose properties best for long-term investing; evaluate operating expenses and calculate cash flows; and, manage properties.

If you are worried about securing your financial future and are thinking about buying your first rental property, then this book is for you. By applying the simple techniques that Retire Rich from Real Estate teaches, you will ensure that you make the right decisions and guarantee that your investing experience will build wealth and secure your retirement.

Table of Contents

?Introduction -

Chapter One: To Buy or Not to Buy
- The Benefits—Making Money Takes Time
- Cash Flow
- Appreciation
- Leverage
- Amortization
- Tax Advantages
- Time is Money
- Just the Facts—The POMS Survey
- The Costs—You Must Be Committed
- The POMS in Perspective—Why Buy At All?
- Summary

Chapter Two: Demographics 101 -
- Who Are Your Tenants and Where Do They Live?
- Future Demand for Rental Housing
- The Shortage of Affordable Housing
- Summary

Chapter Three: Looking for Properties -
- Working with Realtors and the MLS
- Working with a Buyer’s Agent
- Newspaper Ads
- Driving Around
- Tax Records and Mailings
- Using Seller’s Agents
- Real Estate Investment Clubs
- Summary

Chapter Four: The Preferred Property Types
- Single-Family Homes
- Multifamily Dwellings
- Townhomes, Condominiums, and Mobile Homes
- Student Rentals
- Rooming Houses
- Building Styles
- Single-Level, Two-Story, Side-by-Side, and Over-Under Flats
 - Utilities, Bathrooms, and Parking
- Converting Single-Family to Multifamily
- New Construction
- Modular Housing
- Summary

Chapter Five: Choosing a Location -
- The Fundamentals
- Cash Flow versus Location
- Choosing Location Using GRMs
- GRM Summary
- Suburban Sprawl
- Main Street or Dead-End Streets?
- Student Housing
- Appreciation and Growth Trends
- Investing in High-Priced Markets
- Summary

Chapter Six: Determining Cash Flow -
- Myth versus Reality
- Determining Operating Expenses
- Calculating Cash Flow
- Effect of Interest Rates on Cash Flow
- GRMs to Predict Cash Flow
- Cash Flow Calculators
- Determine the Market Rents
- Appreciation Makes Up for Negative Cash Flow
- Summary

Chapter Seven: Valuing Property -
- Methods for Valuing Property
- The Comparative Sales Approach
- The Capitalization Rate Approach—“Cap Rates”
- Stated Cap Rates
- Understanding Cap Rates
- Cap Rates and Short-Term Financing
- Future Trends
- Using GRMs to Predict Value
- Replacement Cost Approach
- Putting it All Together
- The Final Check—Is the Property Likely to Appreciate?
- Real Estate Bubbles
- Summary

Chapter Eight: Financing Your Investment -
- Fixed-Rate, Adjustable-Rate, and Interest-Only Loans
- Understanding Amortization
- The Five Rules of Financing Your Properties
- The Low Down on No-Down Deals
- Cash-Out Refinancing
- Financing for a Fixer-Upper
- Money Back at Closing
- Owners versus Non-Owner Occupied Financing
- Commercial Financing
- Summary

Chapter Nine: Making the Offer and Taking Over -
- Pre-Offer Inspections
- Make-Ready Cost Estimates
- Be Prepared to Walk
- Offer to Purchase Forms
- The Offer
- Disclosure Forms
- Earnest Money
- Be Careful of Contract Exclusions
- Closing the Deal
- Final Due Diligence and Taking Over
- Post-Offer Inspections
- The Tenants
- Identifying Opportunities and Avoiding Problem Properties
- Summary

Chapter Ten: Advertising and Renting -
- “For Rent” Signs
- Using a Realtor
- Internet Advertising
- Student Rentals
- Advertise at Market Rent
- Rent Concessions and Keeping Tenants
- Summary

Chapter Eleven: Managing Your Investments -
- Should I Manage Myself?
- Screening Tenants
- Prior References
- Problem Tenants
- Pets
- The Right Lease
- Enforce It
- The Three Rules of Lease Enforcement
- Repairs and Maintenance
- Handling Minor Repairs
- Painting
- Bigger Jobs
- What is Really Necessary?
- Appliances: Used or New?
- Landscaping
- Renting to Students
- Students and Leases
- Summary

Chapter Twelve: Insurance -
- Property and Casualty Insurance
- Policy Deductibles
- Personal Property
- General Liability Insurance
- Business Owners Package
- Reducing the Risks of Lawsuits
- Mold
- Claims Histories and the CLUE Report
- Summary

Chapter Thirteen: Taxes and Rental Property -
- Historical Overview
- Passive and Non-Passive Income and Losses
- The $25,000 Exclusion Rule
- Depreciation
- Repairs and Improvements
- Other Expenses
- Schedule E
- Lose the Paper and Calculator
- Summary

Chapter Fourteen: Selling Your Property -
- Preparing for the Sale
- Selling as Owner-Occupied Dwellings
- Selling as Investment Properties
- Pricing, FSBOs, and Realtors
- Depreciation Recapture
- Determining your Taxable Gain
- 1031 Tax Exchanges
- Summary

Chapter Fifteen: Bookkeeping and Computers -
- Organizing
- One Bank Account
- Financial Computer Programs
- Summary

Glossary -

Appendix A: Total Operating Expenses -

Appendix B: Maintenance, Repairs, and Reserves -

Appendix C: Typical Computer-Generated Cash Flow (Report for Duplex) -

Appendix D: Inspection Report -

Appendix E: Maintenance Cost as a Percentage of Income -

Excerpt

Editorial Reviews

www.homebuying.about.com Elizabeth Weintraub
"Book Review of Retire Rich From Real Estate
Nowhere in Marc W. Andersen’s book, Retire Rich in Real Estate, does he mention whether he has retired a wealthy man. That’s what I want to know. He might be too young. At last he doesn’t come off sounding like those get-rich seminar guys. According to the publisher, the author has been investing in real estate for more than 20 years, and that experience is adequately reflected in the book.

Tips for Working with Real Estate Agents

Working with the Listing Agent.
Andersen claims buyers might have an edge if they work with the listing agent and, in many cases, it’s true. It’s clear that he understands agent motivation. An agent who operates in dual agency makes more money than a buyer’s agent and has every reason to work harder to get the offer accepted, regardless of ethics.

Excluding FSBO Listings from Buyer’s Broker.
It is also true that if FSBO properties are not excluded from a buyer’s broker agreement, the buyer will pay a commission to buy those properties. However, Andersen neglected to point out that a strong negotiating buyer’s agent could very well save that fee for the buyer through a discounted sales price. The trick is in hiring the right agent.

Negotiating Listing Commissions.
Andersen mentions a key factor that is often overlooked when sellers negotiate commissions: including a reasonable fee for the buyer’s agent. He points out that if the fee offered to the buyer’s agent is much less than others on MLS, your home will receive reduced showing activity.

Tips About Property

Types of Property.
Andersen prefers multi-family dwellings over single family and reasons that if a single-family home is vacant, you will have 100% vacancy, versus one-quarter of a vacancy on, say, a fourplex. This is all fine and dandy except for the fact that in many parts of the country, a fourplex will cost two to four times as much as a single-family home.

Location.
Everybody knows that real estate is about location, location, location, but few really know what that means. It’s more than not buying next to a railroad or under a flight path. The author points out that a rental home on a busy street can be an advantage, because a For Rent sign will be noticed by more tenants. It also would more than likely be located closer to public transportation, which tenants want, than a home tucked away via zigzag streets in a new subdivision.

Pricing.
Besides explaining how to analyze comparable sales, the book details how to compute gross rent multipliers and capitalization rates in easy-to-understand terms that any math-challenged person can follow. Moreover, it discusses the three common approaches to determining value and how to read an appraisal.

Financing Properties
All smart investors use leverage because the dollar return on an investment is typically much higher on smaller down payments, and the author is a proponent of leverage. He also talks about amortization and how to finance those hard-to-finance properties such as commercial or fixer homes. Here are his five tips for financing:


Put down 20% minimum.
His reasoning is otherwise you will pay private mortgage insurance, but if it cash flows with PMI, that’s OK in my book.

Choose fixed-rate mortgages.
In most markets, it makes no sense to use an adjustable-rate loan.

Don’t use an ARM for less than five years.
Obviously, if this is your only financing alternative, waiting five years for an adjustment is better than a loan that adjusts every six months.

Invest cash flow in maintenance or buy more real estate.
Andersen advises against paying down the mortgage, which makes sense.

Utilizing interest-only loans.
Interest-only mortgages, he says, are used if you plan to quickly resell the property, providing you will have enough equity at that point to still net profits.

Making the Offer
How to make an offer is not discussed until the middle of the book. It’s a very short chapter and could have used more in-depth tips. Surely, after 20 years of buying investment properties, the author could have shared a bit more knowledge and insider tips than he did. Likewise, home inspections and contract contingencies are quickly glossed over.


Property Management
The remainder of the book is devoted to how to advertise your rental property, collect rents, screen tenants, make repairs, obtain insurance and figure your tax savings. A very short chapter at the end covers 1031 exchanges and how to sell your rental.

Conclusion

This book is a thorough, step-by-step guide to buying, holding and eventually selling rental properties. It’s chock full of excellent tips and advice that only a person who has actually done it can impart. I rate it a 9 on a scale of 1 to 10.

www.homebuying.about.com"

Blog (Million Dollar Journey)
"Sphinx Publishing contacted and provided me with a free copy of the new book ""Retire Rich from Real Estate"" by Dr. Marc Andersen for review. It came at the right time as I’m contemplating putting more of my money in hard real estate assets.

Although the book is based on investing in the U.S, the lessons provided in the book are relevant for real estate investors everywhere. ""Retire Rich from Real Estate"" is just that, it explains from start to finish how to successfully invest in rentals. It’s not one of those get rich quick type books, the opposite really. The book focuses on the rental real estate investing strategy and how lucrative it can be for the long run.

I’m assuming that the author Dr. Marc Anderson is fairly academic as some of the content in his book is fairly technical in nature. His conclusions are based on research from national real estate investor surveys, demographics and his own experiences.

Who is Dr. Marc Andersen?

Dr. Marc Anderson is a real estate investor who has 20 years experience buying homes and renting them out for profit.

Here is a snippet that I got from the publisher:

Marc W. Andersen and his wife have been actively buying, renovating, building and managing rental property over the last 20 years. He holds a B.A. from Virginia Tech and a Ph.D. from the University of Virginia. He and his wife live in Raleigh, NC.

What are the main points made by the book?

This book is unique in the fact it’s more of a real estate investors handbook/instruction manual. It gives the reader instructional content on how to succeed in rental investing from start to finish. Below are the topics covered:

Looking for properties
Choosing a location
Investing in high priced markets
Understanding cash flow
Determining market rents
Valuing property
Financing your investment
Closing the deal
Managing your investments
Maximizing your tax advantages
Selling your properties
One point that the author emphasizes is that the key to successful rental investing is to make sure that the property is cash flow positive from day one (a key rule that I follow).

What I liked?

I appreciated all the little tips and tricks in the book with every step of the rental investment process. For example,

From his research and experience with student rentals, he finds that renting to boys means less maintenance calls but with higher chance of damage. Whereas renting to girl students means less chance of damage, but higher occurrence of maintenance calls.
On advertising for tenants, his research shows that signs in the yard are just as effective but much cheaper than putting an ad in the paper.
As I have a mathematical background, I personally enjoyed the calculations that he explains in the book to determine valuation. He talks about the 10% rule and how it may not be practical in todays market place.

What is the 10% rule? It’s a rough calculation to determine if a property will be cash flow positive after all expenses. When looking for property to purchase, many real estate gurus state that the annual rent should be at least 10% of the asking price. For example, if annual rents for an area is around $15,000, and the asking price is $150,000, then it would pass the test. If the asking price was $200,000, then the property would not pass the initial 10% rule.

Ideally,

(annual rent)/(asking price) >= 10%
Obviously, this rule is not very practical in expensive cities like Vancouver, Calgary and Toronto. However, it’s a useful benchmark when doing quick scans of rental properties when investment house shopping.

What I didn’t like?

There isn’t anything in particular that I didn’t like in this book. However, the analytical chapters on determining gross rent multipliers (GRM) and other calculations might not appeal to everyone
Final Thoughts:

Definitely a book that’s worth the money for new or experienced real estate investors. It gives the tools for successful investing from calculating cash flow, to the most cost effective means of marketing for tenants. I’ve picked up quite a few tips that I will be applying to my next deal.
Even though the book is meant for the US market, most of the techniques and strategies apply to the Canadian investor as well. There are only a couple of chapters on taxes and insurance that I skipped over.

http://www.milliondollarjourney.com/book-review-retire-rich-from-real-estate.htm"

Blog (Thicken My Wallet)
"Hindsight, as they say, is 20/20. Thus, I found it timely that I received Dr. Marc Andersen’s book Retire Rich from Real Estate in the same week as the global markets came to the realization the American economy may, indeed, be headed for recession (if not already so) due, in part, to the bursting of the real estate bubble.

Although published in 2008, the book was most likely written in 2007 with an eye to the real estate collapse currently unfolding. Andersen highlights in several instances the shift in this decade away from fundamentally sound principals of real estate investing (such as declining capitalization rates, appreciation of property outstripping rental rates and falling net operating income) as a harbinger of real estate collapse (Vancouver real estate investors pay heed!). Although Andersen refuses to state explicitly that we were living in the midst of a real estate bubble, his quantitative analysis, and as history is proving, certainly suggested as such.

Retire Rich from Real Estate is not your typical real estate investing guide. The book takes as its underlining analytical tool the Property Owners and Mangers Survey (POMS) conducted by the U.S. Census Bureau which is the first known survey of its kind. The POMS survey came to a shocking conclusion- only 41.4% of property owners in the survey reported they made a profit on real estate investing! The findings appear to shatter the commonly held belief that real estate investing is “safer” than investing in stock.

Why is real estate investing unsuccessful for over 50% of investors? Andersen undertakes a step-by-step analysis on how to find, buy and rent real estate using the POMS findings as a guide on what to avoid. For example, investing in highly appreciating properties is not necessarily a good thing. Why? Appreciation does not always equal good cash flow- a fundamental cornerstone of real estate investing. Andersen’s analysis suggests a Goldie Locks approach to buying investment property- not too hot and not too cold- which will be both cash flow positive and appreciate over time. I also found it interesting that Andersen’s analysis suggest that average operating expenses (the cost of keeping up a property less mortgage payments) should be in the range of 40-45% of monthly rents; personal experience tells me that most people dramatically under-estimate this figure and end up with zero to negative cash flow.

The book is full of great tidbits on finding good investments in an uncertain real estate market. For example, look for properties that rent for less than the carrying costs of a mortgage in the same area. Why? The tenants cannot convert from renters to owners that easily since they make enough to pay the rent but not enough to carry a mortgage. I also found it interesting that the bigger the unit, the more effective word of mouth referrals was to finding tenants.

Retire Rich from Real Estate is an excellent resource for guiding someone through real estate investing in these turbulent times. One caveat though- the author makes no attempt to dumb down the subject matter. There are times his analysis is very numbers driven and dense. It is not a book for the timid or tire-kickers on the subject.

Thus, my main criticism of the book is that it does read a little too much like a text-book. The copy is long at times and unbroken. There should be a more liberal use of text-boxes, graphs and other devices to break up the analysis. Some more real life examples would be helpful as well to bring the numbers into perspective. Perhaps this is something for the 2nd edition which, may have to be written sooner rather than later, given what is occurring in real estate.

http://www.thickenmywallet.com/blog/wp/"

Trishallen.wordpress.com
"Kiyosaki’s books are great for drumming up one’s motivation to not just dip a toe into the real estate market–but sometimes cannonball into it! However, when it comes to specifics, I’ve been disappointed by Rich Dad books. They woefully lack in detail of “how-to” or “gotchas” to look out for. In fact, I actually stopped reading Rich Dad books a couple of years ago because they got so redundant. And, I suppose, in a small part, I felt betrayed because his books never prepared me for a fraction of the grief that real estate investing has caused me! But, I still want to do REI and intend to continue through retirement and beyond. Sometimes I hate it. Most times I love it. I guess it’s just a passion of mine.
A publisher recently sent me a book to review here for my blog. This isn’t the first time that’s happened. But, so many times, those books ended up not meeting my standards–so, you never heard about them here. I’ve never gotten paid to do a review (Yet. *wink-wink*), aside from just receiving a book for free.
Anyway, this one managed to hold my attention and even teach me some things I really didn’t know! In fact, it’s such a thorough account of what to look for, how to purchase, how to pay for, how to manage, and how to sell rentals that I’ve GOT to recommend it to you! The author even goes through details of how to do your own taxes as a landlord!
I read it from cover to cover.
I found out that my knowledge of insurance and rental coverage was sadly inadequate! I’m going to have to upgrade my coverage on our houses! Had you ever heard of a DP-1 policy vs a DP-3 policy? Yeah, well, me either. A DP-1 policy is probably what most landlords (including myself) have because they’re cheap. A DP-3 policy covers additonal perils not covered by a DP-1 policy, like ice storms, water damage (not flooding), and injury. Apparently, a DP-3 policy has loss of rent coverage, too.
Also, did you know that, according to the “Property Owners and Managers Survey” done by the U.S. Census in 2000, only 41% of multifamily owners reported making a profit? And, only 16% broke even!
In addition, the author (Marc W. Anderson, PhD) lets you in on the following:
“
* About 32% of the owners of 1-49 units would not buy the [same] property again if given a second chance.
* About 50% of the owners of 1-49 units spent 1-8 hours every week on maintenance or management.
* About 20% spent more than 8 hours per week on maintenance or management.”
Revealing, huh?
But, the author also uses statistics to show how there is likely to be a shortage of affordable housing available due to an increase in young adult renters (the “echo boomer generation”, born post-1977), more single adults and single-parents or childless couples, immigrants (predicted to make up 25% of all new households through 2010), and baby boomers who give up their homes for apartment living.
There is opportunity to make money in the rental market, obviously. But, if you don’t already have valuable experience, you will need a guide. Don’t just rely on Kiyosaki’s motivational insights. They’re great–very compelling–but, well, “fools rush in” comes to mind. Take the time to read, “Retire Rich from Real Estate”, by Dr. Marc Anderson, if you’re interested in owning rentals. You won’t regret it. But, you might regret it if you don’t!


http://trishaallen.wordpress.com/2008/02/20/retire-rich-from-real-estate/"

landlord success
"Recently, I finished reading a great book entitled Retire Rich from Real Estate by Marc W Andersen, Ph.D.
This is a great book because not only is the subject of investing in residential real estate covered completely but there are lots of interesting tidbits of information that can help you decide which type of rental property is right for your market, location and temperament.
Also, the complete “life cycle” of the investment is covered. There are explanations about how to determine which property to buy, how to finance it the best way, how to manage the property properly(i.e.- deal with tenants effectively) and finally, how to sell the property and cash in.
One of my favorite chapters is chapter two which goes into the demographic makeup of renters and how they affect the local rental market. This chapter also sheds some light on what the future demand for rental property will be and how you can profit from it.
Another plus is that the author presents some pretty in-depth formulas for valuing a property and determining its suitability as an investment. From my own experience, these formulas are way more in-depth than those I used for selecting my properties. On some of those deals, I wish I had used the author`s formulas.
In my opinion, this book is required reading for anyone interested in residential real estate investing. The key would be to read this book BEFORE jumping in head first.

http://www.landlord-success.com/real-estate-investing/book-review-retire-rich-from-real-estate"

Customer Reviews

Customer Reviews: