Summary of Sam Liebman's Harvard Can't Teach What You Learn from the Streets

Everest Media

Description

Please note: This is a companion version & not the original book.
Sample Book Insights:
#1 There are few, if any, institutions that offer a formal real estate education. However, there are many who offer a marketplace polluted with worthless motivation preacher-teachers whose focus is on peddling their misleading books, tapes, and seminars.
#2 If you buy into this ridiculous philosophy, you're disrespecting the process of learning real and worthwhile knowledge. And worst of all, you're fooling yourself. Sophisticated and advanced concepts and knowledge take years to master: no pain, no gain.
#3 Street knowledge is the type of knowledge that successful professionals use. It is more than common sense, and it can only be learned through personal experience. You must learn to think outside the box to become a successful entrepreneur.
#4 When you are working for someone else, you are learning at their expense. When you're in your own business, you are learning at your own expense or, if you have investors, at their expense as well.

Sujets

• Autobiography
• Business
• Biography

Informations

• Publié par: Everest Media LLC
• Date de parution: 31 juillet 2022
• Nombre de lectures: 1
• EAN13: 9798822564626
• Langue: English
• Poids de l'ouvrage: 1 Mo

Extrait

Insights on Sam Liebman's Harvard Can't Teach What You Learn from the Streets
Contents Insights from Chapter 1 Insights from Chapter 2 Insights from Chapter 3 Insights from Chapter 4 Insights from Chapter 5 Insights from Chapter 6 Insights from Chapter 7 Insights from Chapter 8 Insights from Chapter 9 Insights from Chapter 10
Insights from Chapter 1

#1

There are few, if any, institutions that offer a formal real estate education. However, there are many who offer a marketplace polluted with worthless motivation preacher-teachers whose focus is on peddling their misleading books, tapes, and seminars.

#2

If you buy into this ridiculous philosophy, you're disrespecting the process of learning real and worthwhile knowledge. And worst of all, you're fooling yourself. Sophisticated and advanced concepts and knowledge take years to master: no pain, no gain.

#3

Street knowledge is the type of knowledge that successful professionals use. It is more than common sense, and it can only be learned through personal experience. You must learn to think outside the box to become a successful entrepreneur.

#4

When you are working for someone else, you are learning at their expense. When you're in your own business, you are learning at your own expense or, if you have investors, at their expense as well.

#5

Fear, no matter how small, can cause motivation to cease instantly. You must learn to confront and overcome any fears you have, and never let them stop you from learning.

#6

Having no skin in the game is the opposite of being motivated to do something. When you put your money on the line, you are more willing to take risks and fear.

#7

To overcome fear, you must be prepared for any situation that may occur. This means knowing your stuff! Very few people would have the courage or stupidity to start driving after reading a book or listening to tapes on how to do so.

#8

There are three types of people in the pool: those who dip their foot in, those who wait a minute, then dip their other foot in, and those who jump in headfirst without hesitation.

#9

This book will provide you with the basic knowledge needed to enter the world of real estate investing. You will learn how to use street smarts to get where you want to go, preferably by the shortest route. You will also learn how to become an opportunist capable of coming up with alternative solutions in difficult situations.

#10

To overcome your fears, you must become prepared for any situation that may occur. You must know your stuff! Motivation will halt once an element of fear enters the picture. If the fear isn’t apparent, you must make it surface and address it head on.
Insights from Chapter 2

#1

To fully understand how and why a property increases in value, you must understand fundamental arithmetic computations and concepts.

#2

Understanding the components that make up a rent roll is important when investing in multifamily properties. The rent roll is a list of all the unit numbers, types of units, unit sizes, names of the tenants, lease move-in dates, start and termination dates, and other charges.

#3

Increasing rents and operating expenses by 3 percent annually from year to year, while holding on to the property, increases the property's net operating income by $24,121.

#4

Cap rate increases cause a compounding effect on the annual base rent increases each year during the five-year period. This is an extremely important concept for you to understand. When you apply cap rate power to the resulting NOI, the results become staggering.

#5

Some increases in operating expenses are most likely to be temporary in nature. These expenses are usually caused by market volatility and will eventually return to normal.

#6

The cap rate is a simple but powerful formula that can be used to evaluate the profitability of a property. It is calculated by dividing the property’s net operating income by the purchase price.

#7

Increasing the NOI of a property by just 3 percent per year should increase its value by about $402,008 over a five-year period. This is because the capitalization and compounding effects of an increasing rent roll combined with a low cap rate environment are the fundamentals of becoming rich through real estate investment.

#8

The size of a property is made up of two components: gross and rentable square footage. The building's gross square footage is the number of square feet that base rent can be charged, but the buildings have common areas that should be subtracted from this number in order to compute the rentable square footage.

#9

Upgrading a property’s units can increase their rent by $100 each, which can be accomplished by making an investment of $3,000 per unit. The effect of the awesome power of capitalization and cap rate power will substantially increase NOI and the value of the property.

#10

The real potential for increased property value often lies in the potential for growth of the existing rent roll. A property whose rent roll is at or above market rents is known in the industry as being maxed out, meaning little or no room for growth.

#11

Upgrading a property does not necessarily mean it will be able to be re-rented at higher rates. If the area is experiencing high rent growth, the new projects may experience higher vacancies, which will force the older projects to lower their rents in order to compete.

#12

We will now replace base rental income with effective gross income, and the revised formula will be as follows: effective gross income = gross income + operating expenses excluding debt service, depreciation, capital reserves, and other operating expenses.

#13

The vacancy factor is the amount of loss in rent that should be accounted for in the property’s effective gross income. It is calculated by taking into account the market conditions, type of tenancy, and physical condition of the property. The tenant reimbursements should always be included in the vacancy and collection loss factor.

#14

Increasing the rental income of a property is entirely under your control. The potential for increased property value often lies in the growth potential of the existing rent roll. A property whose rent roll is at or above market rents is known in the industry as being maxed out, meaning little or no room for growth.
Insights from Chapter 3

#1

The first step to take before purchasing a property is to receive or create an OM, then evaluate it. The OM is prepared by the licensed real estate brokerage company offering the property for sale.

#2

The OM should be viewed as a snapshot or guide to the property, not a detailed report. Some OM s lack the necessary information to properly evaluate the investment, especially when dealing with unsophisticated owners and brokers.

#3

The listing broker is contractually obligated to represent the seller, not the buyer. To obtain the listing, the broker most likely had a prior relationship with the seller and wants to remain in their good graces so that they will continue to provide them with properties to sell.

#4

It is important to recognize that not all real estate brokers are created equal. Some are more honest than others, and some may even have a disclaimer that states that the information they provide is not guaranteed.

#5

It is important to hire an outside real estate agent to market the property for sale. The best price for a property is attained through marketing it to as many prospective purchasers as possible, even if a broker fee must be paid.

#6

A garden apartment community is characterized by a group of low-rise buildings, two to five stories high, on a common parcel of land. They often consist of multiple buildings with their own addresses. They feature open landscaping, catwalks, and various pathways that are considered common areas for the residents.

#7

The propaganda in an OM is made up of a narrative that describes the property’s positives and why it’s such a great opportunity for prospective buyers. The OMer wants to paint a picture of the property, highlighting any recent renovations that might increase its value.

#8

Because the stakes are so high, almost every owner knows what their property is worth. This is because brokers have educated not only owners but themselves on how the value of a property can change by making improvements.