Rob Rowsell discusses the concept of forced property appreciation. Rob learned a lesson from applying for an SBA Loan for a property from the Small Business Administration. In the end, he made huge gains from his auto repair shops’ appreciation in value over the years.

Mistakenly Applying For A Small Business Loan

Rob begins the clip discussing the steep income tax in California, and his shift to investing in other states. When Rob once applied for a small business loan with the United States SBA, he learned that investors must guarantee their loans with all of their personal assets.

He owned several auto repair shops at the time, and needed the liens removed from them in order to sell those businesses. When he tried to cross collateralize those with other businesses, he was informed that he had to pay off the shops completely. Rob, short on time, decided to go ahead and do that. That decision had some unexpected rewards.

Forced Property Appreciation on a Business

After paying off the loans for his auto repair shops, Rob learned the property had increased in value greatly. This property appreciation yielded a few hundred thousand dollars in just five years of ownership. This is not to mention the revenues you accrue over years of running the business. You won’t owe any taxes on that property appreciation until you eventually sell it.

Join Our Community

Do you own multi-family properties? If not, do you aspire to one day? Then you should consider joining our online discussion group, the Addicted To Life Community! Each month, Rob Rowsell will teach you what you must do in order to build wealth in the real estate business. It’s not as easy as it looks! Property taxes, liens, and legal fees can all be hard to navigate, so having a successful guide in your corner like Rob is a must! Enroll today!

When you are interested in a real estate property, make sure you do your due diligence. Specifically, Rob talks about the Purchase Sales Agreement, in addition to past financial documents from the current and previous owners. Rob reviews what should go on a PSA, so we make sure the agreement is thorough before we purchase. Comb through all of the documented repairs, receipts, and other expenses, so you’re not left holding the bag later!

Purchase Sales Agreement – Putting the Property Under the Microscope

So you think you’ve found the ideal investment property. Everything looks great on the surface. The price is within your budget. Curb appeal is on point. You’re potentially entering into a turn-key operation, and won’t have to replace any staff. Now, the real work begins.

Before committing to this real estate investment, you need to put together a Purchase Sales Agreement. Sounds simple, right? Well, get ready. You and your team will be reviewing past financial statements, repair contracts, legal disputes, and more. You name it, and you could be on the hook for it! The Purchase Sales Agreement is the most important in a series of hoops you will jump through before purchasing your dream rental property. It will pay off to be as thorough as possible and get outside help in evaluating the property.

Join Our Community

Do you own multi-family properties? If not, do you aspire to one day? Then you should consider joining our online discussion group, the Addicted To Life Community! Each month, Rob Rowsell will teach you what you must do in order to build wealth in the real estate business. It’s not as easy as it looks! Property taxes, liens, and legal fees can all be hard to navigate, so having a successful guide in your corner like Rob is a must! Enroll today!

How close are you to absolute financial freedom? Rob Rowsell talks about how to grow your money and live off of investment income only. Rob has transitioned from a multiple business owner to a multiple family real estate investor. Who better to take advice from? Rob has learned the hard way how to avoid unwise investments and do his due diligence to ensure his income only comes from his properties.

Tasks to Transition to Living Off of Your Investment Income

Rob starts off the clip laying out his current financial situation. He no longer holds a conventional “W-2” job. Therefore, he depends solely on his apartment holdings to generate cash. Reinvesting that cash wisely is his key to maintaining financial freedom. Do you still have a full time day job? You can still take steps to eventually fund your lifestyle solely from investment income. If you dedicate just eight hours per quarter to your investments, you are well on your way.

We talk often about the Vitality Spreadsheet. Examining this document will help you determine the income amounts you need in order to meet basic needs, then live with vitality, and, finally, achieve total financial freedom. You must take time to thoroughly vet potential property investments, while reviewing your numbers with a fine toothed comb. If that sounds like a part time job, that’s because it is! However, performing your due diligence will pay dividends for you and any potential investment partners down the line.

Join Our Community

Do you invest in real estate? Planning on transitioning to living off of that investment income? Then you should consider joining our online discussion group, the Addicted To Life Community! Each month, Rob Rowsell will teach you what you must do in order to build wealth in the real estate business. It’s not as easy as it looks! Property taxes, liens, and legal fees can all be hard to navigate, so having a successful guide in your corner like Rob is a must! Enroll today!

Do you plan to invest your money in a business or property? Then you MUST fill out your due diligence checklist. This includes population demographics, surrounding businesses, competition, economic conditions, and more. Rob goes DEEP into the weeds in order to discuss all of the research factors you should consider. BEFORE you invest in any kind of business, you must watch this video!

Auto Repair Shop Investing Due Diligence

Rob began by listing off just a few potential businesses that one could invest in. Consider everything from coffee shops to apartment complexes to auto repair shops. All of them have one thing in common. Researching their demographics is key. An average investor may be interested in injecting capital into a business. In that case, they would be wise to do their homework.

Specifically, Rob then expanded on due diligence for aspiring auto repair shop owners. Perhaps you are investigating a vacant property. You wish to build a new repair shop on it. In that case, consider the size of its population. Next, take a look at how many existing automotive shops serve that community. Are you currently considering an underserved region? Or is the area already overserved? Rob calculates that one average sized auto repair shop can serve up to 1,000 households. Is your target city’s population approximately 20,000? Then it could theoretically sustain up to 13 successful shop locations in the area.

Researching Household Income

However, you are not just looking at how many people live near the businesses. You want to know what the average household income is. Aim to plant your business in the middle of a thriving community. That means its citizens average $70,000 or more in annual income. These folks are much more likely to prioritize maintaining their vehicles than other, less fortunate individuals. That may not be a fun statistic to quote, but it is true. We are all trying to make a profit. And we want to do it without fighting a constant uphill battle.

What about investing in existing auto repair franchises? That honest mistake ensures you will get a smaller cut of the pie. All the while, you will work harder in order to fit into someone else’s mold. Investing in a turn key, existing business can still benefit you. If you find this idea appealing, then seek out independently owned auto repair shops.

Due Diligence in Real Estate Investing

Moving on, we discuss the real estate industry. Rob discourages pursuing properties on apartment listing aggregate websites. Many of these sites set off a race to the bottom. When this happens, competition can get fierce. The properties listed on these sites often end up driving down prices. They do this by offering move in specials. Everyone needs a place to live. Discounts like these help a lot of lower income renters. However, you want to invest in higher end, multi-family properties. Those will not be surrounded by stiff competition. They will also give you much larger returns on your investments.

Next, let’s talk about your area’s demographics. Rob lays out an ideal situation. Let’s say the community population is 100,000 people. You will want there to be no less than one hospital nearby. What’s a tip many folks may not consider? Scout a property that is 30 minutes or less away from a major airport. Rob prefers an international one. Are you investing in rental properties in multiple large markets across the country? Then you will want them to be easily accessible to you. Let’s face it: you are busy, and you don’t need to spend your time driving all the way across town to assess an issue with your complex.

Investigating the Area’s Economy

Moreover, you must examine the economy in your chosen area. Job growth should consistently be trending upward. That figure should read a 4-5% minimum, year over year. You will also want a diverse selection of industries throughout the city. Many communities’ economies are based on only one industry. This could be, for instance, a car and truck manufacturing plant. That factory, situated in the town’s industrial zone, may employ half the town. Thousands of small businesses have sprung up around it to serve its employees. How many times have we read headlines about those plants moving overseas, and ruining the area’s entire economy? Now, the plant workers, as well as the other businesses’ employees, are all out of work. If you invest in a shop serving these people, you and your staff are next.

Rob also mentioned the huge hit that the hospitality industry took during the COVID-19 pandemic. If an entire town’s economic hopes are pinned solely on a resort, an event like that will sink it. Every town is a business, and just like with any successful business’ investment strategy, diversifying is key. Remember this when you’re doing your due diligence.

Join the ATL ALL-In Financial Community

Do you currently own multi-family properties? If not, do you wish to invest in the future? Then you should consider joining our online discussion group, the Addicted To Life Community! Each month, you will join your fellow investors on a live Zoom roundtable talk. Rob Rowsell will teach you what you must do in order to build wealth in the lucrative real estate industry. It is not nearly as easy as it looks! Property taxes, liens, and legal fees can all be mind numbingly hard to navigate. Having a successful guide in your corner like Rob is a must! So sign up today!

The ATL Financial Discussion Community talks about the five lanes we can travel in with our lives. Rob encouraged each investor to improve on one problem area of their lives since last month’s investment conference. Both Rob and Gary are here to encourage the investors in our groups to live fulfilled, balanced lives.

Investment Options Financial Discussion

Rob opened up this financial discussion with a review of the Five Lanes from the last call. Previously, each caller discussed how they rated their performance in each category. He reminded the ATL members that at the end of the day, he was there to help spark the change each of them needed. Last month, the roundtable members admitted they needed to improve areas of social interaction, health, and community service. If nobody improves, these Zoom calls are all for naught. Rob truly believes that anyone can reach his level of success if they focus, work hard, and be patient.

The five lanes we previously discussed ranged from fast (hot) to slow (cold), based on what level of priority they were. Specifically, Rob mentioned their correlation to JR Covey’s Four Quadrants of Time Management. The individual issues members mentioned fall into the social concerns in Quadrant Two. This means that they are important, but not urgent. Therefore, it is easy to put off improving those areas. Immediately, you won’t tell a difference, but over time, they will cause problems if you do not work on them.

Join Our Community

Do you own multi-family properties? If not, do you aspire to one day? Then you should consider joining our online financial discussion group, the Addicted To Life Community! Each month, Rob Rowsell will teach you what you must do in order to build wealth in the real estate business. It’s not as easy as it looks! Property taxes, liens, and legal fees can all be hard to navigate, so having a successful guide in your corner like Rob is a must! Enroll today!