Real Estate Millionaires
Becoming a millionaire has always been part of the American dream, or at least achieving a certain level of financial success. One of the surest paths to financial prosperity is through the acquisition of real estate. Those of us living in the Bay Area have certainly seen, first hand, the benefits of real estate ownership. Usually, there is nothing quick about getting rich with real estate. A lot of real estate seminar promoter’s promise fast, easy, get rich quick, approaches to real estate.
Some speculate in real estate, buying a tired or run down property and fixing it up and turning or flipping it, trying to make a profit. This type of speculation can be profitable, but most people do not have the building or construction background to accomplish this effectively. If you have to hire the various trades’ people it can get real expensive fast and erode potential profits. If you are borrowing the cash to purchase the property and then borrowing additional funds for the project the holding costs can eat up profits in a hurry. If there is some profit, then remember about your silent partner in the project, the State and Federal government wants their fair share, it is considered a short term capital gain.
Most people who do well with real estate are long term investors not speculators. The secret is to become a high net asset individual, not necessarily a high income person. It is true that it does take a significant capitol to be a successful investor, or at least it is a lot easier if you have access to capital. But, over time it becomes financially easier as your investments grow.
A lot of us would like to achieve millionaire status. However, due to inflation the status of millionaire isn’t as exclusive as it once was. Maybe having financial independence is a better way of achieving your financial goal.
Starting with a business plan, being well organized and keeping your monthly expenses or overhead cost low is the first step.
In 2017, it was reported that there were roughly 13.6 million people with $1 million dollars or more in the United States. It is estimated that by 2021 there will be 18 million millionaires. Another commonly use term is multi-millionaire; this is having two million dollars, or more, in net assets. Having two million or more dollars puts you in a little more exclusive club. Only a small minority of millionaire households are indeed multi- millionaires.
When you’re investing, it is helpful to have goals along the way to gauge your progress. Achieving becoming a millionaire is a good goal.
51% of people with a net worth over $50 million dollars live in North America. There are more millionaires in the United States than any other Country in the world. Real Estate investing has made more people millionaires than any other field of endeavor.
This article was originally written for and appears in the San Francisco Examiner. Eric Ruxton and Larry Aikins are the owners of Terrace Realty Inc. and Terrace Associates Inc., in Redwood City. Terrace has been in business for 60 years and in addition to being an independent Brokerage Company, also owns and operates rental properties.