Updated: Jul 15
“Ninety percent of all millionaires become so through owning real estate.
— Andrew Carnegie
As inflation continues to eat away at our pocketbooks and fear of an impending recession rises, more and more individuals are looking for a path to financial freedom.
Perhaps one of the greatest financial minds of modern time, Robert Kiyosaki, has made millions of dollars through his real estate investments. As a man from humble beginnings, his success was hard-earned and completed one step at a time. He famously said the following:
“Real estate investing, even on a small scale, remains a tried and true means of building an individual’s cash flow and wealth.” — Robert Kiyosaki
AI-Generated Photo by Author
In his best-selling book, Rich Dad, Poor Dad, Kiyosaki describes how a small $20,000 investment he and his wife made into a single-family home snowballed into an apartment complex of over one million dollars just a few years later. This can be done through the powers of appreciation, market knowledge, and leverage.
The goal is to buy when prices are low, hold while making rental income, then sell when prices are high. Then, use the equity from that deal to invest in a larger deal. Rinse and repeat.
The lesson is not to make the mistake of thinking you need a massive sum of money to get started in real estate. Instead, wisely invest in something that makes sense for your financial situation and then build from there.
But how do you know when an investment is a wise decision? When is the right time to buy?
A quote from Warren Buffet can summarize the simple answer to that—
“I will tell you how to become rich. Close the doors. Be fearful when others are greedy. Be greedy when others are fearful.” — Warren Buffett
A new investor's biggest mistake is going along with the crowd or participating in the most recent and exciting trends. Money is made through innovation and buying in while everyone else tries to get out. The excitement around the market or a product only increases demand and prices, with everyone thinking that those prices will continue to rise.
But the market always corrects itself and may come crashing down hard. And this is your chance to make money.
“Look at market fluctuations as your friend rather than your enemy; profit from folly, rather than participate in it.” — Warren Buffett
Another Buffett quote serves as a reminder that savvy investors will look at market changes as perfect investment opportunities rather than something to be feared.
Any basic college economics class will tell you that financial markets constantly flow from highs to lows and back again. Your job is to pay attention and be ready to make a move when the opportunity arises.
Changing to a more lighthearted note, let’s remember why real estate is such a valuable asset that has continued to appreciate, and that reason is scarcity.
“Buy land, they’re not making it anymore.” — Mark Twain
While it is a funny real estate quote by a historical figure, we wouldn’t usually associate with real estate investing, our friend Mark Twain is absolutely right. Property is the ultimate limited resource on our planet, with more and more demand as the population continues to increase.
Property values have increased by 160% since 2020, with a national average of 3.5-3.8% per year. So while timing the market to buy in at a low is the ideal scenario, any real estate purchase is likely to increase in value if you hold for an extended period.
“One thing I tell everyone is learn about real estate. Repeat after me: real estate provides the highest returns, the greatest values, and the least risk.” — Armstrong Williams
Now it’s time for you to get out there and take the first steps. This real estate motivational quote from Williams emphasizes the importance of having a willingness to learn. Which you’ve already shown you have by reading this today. You don’t have to become an expert overnight, but be sure to work to develop your knowledge and understanding of real estate investment.
Once you have a grasp of the market and what your move should be, talk to your local lender and real estate agent. There are many lending opportunities available, especially for first-time home buyers.
As a final thought, consider this quote—
“Some people want it to happen; some wish it would happen; others make it happen.”
— Michael Jordan
The future you strive for will never come if you don’t get out there and chase it. Financial freedom and wealth are achievable for anyone who puts in the effort, and real estate continues to be the best way to go about it.
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