the investment news - february 2014

8/9/2019 The Investment News - February 2014

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INVESTMENT NEWS

MEETING

LOCATION

Holiday Inn & Suites

Overland Park West 8787 Reeder Road

Overland Park, KS

Top Floor Sunset Ballroom

6pm to 9pm Details at MAREI.org

Real Estate Investor Meeting On February 10th, 2015, at MAREI’s Month ly Meeting, Kansas City Sing le

Family Experts Andrew Syrios, Phillip Syrios and Bill Syrios with Stewarship

Properties will present “ Why & How to Invest in Buy and Hold.”

Buy and Hold Way to Build True Wealth

When lying on his deathbed, John Jacob Astor, the real estate mogul and first

multi-millionaire in American history was asked what he would have done different-

ly. He said he would have bought more!

Holding real estate is greatest method yet discovered for a person of modest

means to become independently wealthy. Indeed, it is the I.D.E.A.L. investment:

I: Income (Cash Flow from Rentals)

D: Depreciation (Tax Write Offs)

E: Equity Buildup (As the principle of a mortgage is paid off)

A: Appreciation (In the long run, real estate goes up in value)

L: Leverage (Use the power of OPM, Other People’s Money)

Discover why buying and holding real state is such a powerful way to grow wealth

as well as the ends and outs of how to get started in buy and hold!

Tuesday’s Meeting is FREE for member’s and has a cost of $25 at the door or

$15 if you preregister on the calendar of events at MAREI.org.

Mid-America Association of Real Estate Investors Newsletter February 2015

Buying or Selling Property? MAREI members post properties on their own free website.

Properties flow through to the MAREI website where they are sent out to the Member Data-

base and the MAREI Facebook pages. If you are buying, please check our website, if you

are selling, please join and market your property

FREE BONUS!

Build Wealth through Buy and Hold

a Preview of Special Reports on

the MAREI Facebook Page:

Direct Link: MAREI.org/FB


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Events

FREE Website*

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Marketing

Local & NationalVendors

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counts

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for Members to

Connect & Market

National Legislative

Watch Keeps You

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Annual $99

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MAREI.org

Mission & Strategy We’re inundated with “Flip This House” type TV shows which interject

enough drama to keep our interest. “Hold This House” just doesn’t cut it

for spell-binding television. So fix and flip has its advantages when it

comes to reality TV but does it hold (pun intended) such advantages

when it comes to reality itself?

I’ll admit bias. Our company, Stewardship Properties, built a relative for-tune from buy and hold which would have never happened with a fix and

flip strategy. With this bias in mind, let’s look at the relative merits of both.

The Benefits of FIX and FLIP

Cash Now: When you get good at fix and flip (and, like any endeavor, ittakes work and experience to excel) you can make 10 -30% of the proper-

ties’ original cost. Putting 10-30,000 or even more into your pocket two,

three, or more times a year adds up to a pretty great income and all the

time being your own boss. If you look at this as a game of getting the best

ROI (return on cash investment dollars) flipping can produce a high ROI.

Limited Risk: As recent historical experience has reminded us, real es-

tate does not always go up. Over time real estate follows inflation but ifyou are in a down cycle, flipping properties protects you from the down-

side.

Less Financing Pressure: If you can find a source of cash and you aresuccessful at flipping, that cash can be “re -circulated” time and again with-

out the need to look for further cash sources. This allows you to focus on

finding and flipping for the highest returns.

No Property Management: There are no tenants, termites or toilets andthus no need to find competent property management (no small task) or

to build a competent property management company yourself (no small

task). Management, maintenance and tenant-landlord legal issues can eat

up lots of time, energy and profits if not done well. Even when done well

you can sometimes end up with high turnover costs and unpaid damage

or rent. Again, consistent expert property management is no small feat,

but the only way to reliably extract income from your rental assets.

Focus on Good Deals: Flippers know that margins can be thin and thatany number of “soft costs” can eat into their profits. This often forces them

to get the best deals possible. So they are always looking for motivated

sellers, negotiating the best possible deal, keeping their hold times to a

minimum in order to maximize their profits and move on to the next flip.

The pressure is on from start to finish… and that’s a good thing.

Breadth of Market: There are higher -end homes and expensive locations(e.g. San Francisco or Honolulu) that will never pencil for a buy and hold

strategy but conceivably you can flip any property in any location for a

WHY ( HOW)

YOU SHOULD BUY AND HOLD

REAL ESTATE

TUESDAY Feb 10t h


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profit. Buy and hold investors who purchase such lower ROI properties may do so because they have plans for a

large value add or because they believe the property/location has a significant upside in appreciation value. But

normally higher end markets are not as conducive to a buy and hold strategy as they are to fix and flip.

The Benefits of BUY and HOLD

Holding properties has produced untold millionaires and billionaires. Real estate investment is flat out the aver-

age person’s best shot at creating serious wealth. If you flip you can make a profit, if you hold, you can make afortune. As such holding real estate is the…

I-D-E-A-L investment.

I-ncome: Residual income amounts to positive cash flow on automatic pilot, whether you put time intohustling for the next deal or lying somewhere on a beach. This is the goal of the buy and hold strategy, to provide

you with a reliable stream of income that is not contingent on working. The challenge is to keep financing proper-

ties at 100% (or nearly 100%) and manage them so that the rental income exceeds the expenses. Obviously the

more properties producing positive cash flow in your portfolio, the greater your monthly income becomes. There

are many real estate buy/hold investors who would never have to work another day in their lives if they choose

not to.

D-epreciation: One of the cons of flipping is that it produces taxable income at ordinary rates whereas

holding can allow you to have an income via positive cash flow and yet show a tax loss from depreciation. Whena property is sold, its depreciation must be recaptured and then incur capital gains tax (often at a lower rate than

ordinary income). To avoid any such tax consequence, properties may be sold via a 1031 exchange or better,

yet, kept for a lifetime of wealth creation and passed on to heirs who receive them as if they have not been de-

preciated at all (at zero tax basis). Federal inheritance tax law allows five million dollars (or five million from each

spouse via a trust) to freely pass on to heirs. (State laws vary.)

Additionally, any time you refinance your properties, the capital you receive is a loan so those funds are not taxa-

ble at the time of receiving. Refinancing also can allow for a very high ROI or even an infinite ROI when all down

payment funds are received back in the refinance. Refinance can, in effect, leverage the leverage!

E-quity Build-Up: Unless the mortgage is interest-only, each payment made on the loan cuts down the principalusing rent to pay off the mortgage. Amortization tables are a thing of beauty to a buy and hold investor because

each and every month they get closer to owning their property debt-free. And if they chose to refinance along the

way, well, go back and read the previous paragraph! So, if you have a 120,000 property fully financed at 5.5%

interested over 30 years you would have paid off 9,047 in 5 years and 20,951 in 10 years.

A-ppreciation: If you look back in history, the real estate market has appreciated at a rate similar

to inflation which is calculated at 3.4% over the last 93 years and 2.5% over the last 10 years.

(CLICK HERE.) If we see a 3% appreciation rate going forward, a 120,000 property will be worth

139,113 in five years and 161,270 in ten years. Below is a map that shows appreciation state-by-

state since 1975. For more specifics on it, CLICK HERE.

(Continued on page 4)

INTRODUCING

http://heartsofthegods.blogspot.com/2007/07/what-is-average-inflation-rate-in.htmlhttp://heartsofthegods.blogspot.com/2007/07/what-is-average-inflation-rate-in.htmlhttp://www.estateofmindsites.com/subscriber_new/map.php?user_id=1&share=yhttp://www.estateofmindsites.com/subscriber_new/map.php?user_id=1&share=yhttp://www.estateofmindsites.com/subscriber_new/map.php?user_id=1&share=yhttp://heartsofthegods.blogspot.com/2007/07/what-is-average-inflation-rate-in.html


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Just taking equity build-up and appreciation on our hypothetical 120,000 property you have realized a gain of

28,160 in five years and 62,221 in ten years. Yes, the property required management over that period of time

and you had to put in some capital improvements (like a new roof/water heater/exterior paint job/etc.) but you

have also experienced a 6,222 per year gain over a ten year period of time as well.

L-everage: The reason that real estate is the only likely investment option that can make a person of average

means wealthy is because of the last word in I -D-E- A-L: leverage. When you use only a small portion of your

own funds: 25%, 15%, 5% or even less and you finance (use other people’s money) the remainder of your pur-

chase/upgrade, you have put in a relatively small percentage of your own capital (0 -25%) and yet realized

100% of the profits and benefits. Those benefits—

I-income from positive cash flow,

D-epreciation from tax benefits,

E-quity Build-Up from mortgage pay off,

A-ppreciation over time, combined with the

L-everage of using other people’s money

—will substantially multiply your return and, over time, MAKE YOU WEALTHY!

We are buy and hold investors because we’ve found the way to overcome the challenges and to realize

the benefits… on a daily basis.

Question: Why would you EVER sell any property if

1) it cash flows,

2) you don’t need the money, and

3) it is well-managed?

Stewardship Properties has two objectives: CREATE WEALTH and OPPORTUNITIES.

To do this we look to form dynamic partnerships, creating win/win situations with our private and bank

lending partners in order to address the challenges of a buy/hold strategy so we can realize its bene-

fits. Please Visit our Website at StewardshipProperties.com


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INTRODUCING

Bill Syrios began real estate investing in Portland, Oregon in 1980. Be-tween 1980 and 1986 he bought,

rehabbed and sold four houses. In 1989, Bill moved to Eugene and formed Stewardship Properties with a fo-

cus on buying, renovating and managing campus rental properties around the University of Oregon. He found

this niche to be a prime, value-add market that produced high rental income. In 1992 he moved into full-time

real estate investment and now owns 300 houses and apartment units in Oregon.

During the summers of 2005 and 2006 Bill put on an internship for 16 students from the University of Oregonand Oregon State University who became involved in every aspect of his company: negotiating with sellers,

purchasing properties, overseeing rehab, property management, etc. His intention was to find the very best of

this group to join him as full-time real estate investors and, in 2007, he formed two partnerships that included

five of those students. During 2007-2010 these two partnerships flipped nearly 200 houses, most of which

were short sales and foreclosures in Eugene, Salem and Portland.

In 2009 Bill turned his attention to the Midwest and began purchasing properties there including apartment

complexes in Kansas City and Dallas. In January 2011 his son Andrew, and later in September 2011 his son

Phillip, moved to Kansas City to focus on buying, renovating and man -aging high cash-flow properties with a

buy and hold strategy. The company in Kansas City, Stewardship Investments, currently owns 185 houses,

duplexes and apartment units. He also, has a partner in Dallas, Texas, Greg Whitney. Together they have

purchased and renovated two multi-family complexes in the Dallas area that total 76 units.

Andrew Syrios began working as a real estate investor in 2005. He graduated from the University of

Oregon’s college of business in 2006 and became a full-time real estate investment partner with Bill and oth-

ers in 2007. Later, in 2011, he moved to Kansas City and headed up a new operation for Stewardship fo-

cused on purchasing, renovating and managing residential properties. He has extensive experience in evalu-

ating properties, negotiating with sellers, overseeing property rehab and working with real estate finance.

Phillip Syrios graduated from the University of Oregon’s business school in 2010. After a brief stint as

a professional poker player, he joined Andrew in September of 2011 in Kansas City. His focus has been to

oversee property management and build systems to help Stewardship’s office team run efficiently and effec-

tively.

CONNECT IN PERSON

Office: 7215 Troost, Kansas City, MO

64131

Phone: 816-333-RENT (7368)

Bill: 541-221-4242

CONNECT ONLINE

StewardshipProperties.com

333Rent.com

TheGoodStewards.com

On Facebook & LinkedIn


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Regular Pricing: $49 for member, plus $20 for guest. $69 for non-member, plus $20 for guest.

Special Price till the 11th: $29 for member, plus $10 for guest. $49 for non-member, plus $20 for guest

Add $99 for Annual Membership for 1 or $149 for Annual Membership for two. Total: _______________

Name: _____________________________ Second Person Name: ________________________________

Email: ___________________________ __ Second Person Email: _________________________________

Phone: _____________________________ Secondary Phone: ____________________________________

Address: __________________________________________________________________________________

Paid by Check: #__________ Paid by Credit Card: #_____________________________________________

Expire Date: __________ Security Code: ______________

Signature: _______________________________ Or register Online at MAREI.org or Phone at 913-815-01114

Saturday Feb 21st 8:30 to 4:30, Lunch Included, Career Education Systems, Top Floor Ward Pkwy, 8600 Ward Parkway, Kansas City MO

There has never been a better way yet discovered to be-

come independently wealthy than buying and holding real

estate. But looking at it from the outside can quickly be-come overwhelming. After all, there are a lot of moving

parts that all have to fit together.

We will break down and fit the many pieces together. An-

swering questions about the four main areas of buy and

hold such as:

Acquisition:

How to find and purchase real estate at a discount?

What are the differences between looking at a property

to flip and looking at a property to hold?

What different things should I look for in houses andmultifamily?

Rehab:

How do you budget a rehab project?

Should I hire contractors, employees or do the work

myself?

How do I make sure a project stays on course?

Finance:

What options are available for financing buy and hold How can I get into buy and hold properties for zero or

close to zero down?

How can I make a property cash flow with a private

loan on it?

Where should I look for private money?

Management:

Should I hire a management company or manage my

self?

How do I deal with maintenance?

What do I screen for?

What if a tenant doesn’t pay? Or destroys the unit? O

threatens another tenant?

We will answer all of these questions and clear up why bu

and hold is not only the best investment, but also some-

thing that is absolutely achievable for novices and pros

alike. If you want to get started in buy and hold or want to

grow your real estate empire even more, please join us o

Saturday February 21nd At Career Education Systems!


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BUSINESS

directory

Service Company Contact Phone Web

Auction Company Cates Auction Staff 816-781-1134 CatesAuction.com

Contractor Building Trades Robert Massey 816-868-1817

Contractor Discover Heating & Air Curt Whitlock 816-500-2970 Discover HVAC.net

Contractor Supply Home Depot Sharon Beck 913-313-8912 HomeDepot.com

Contractor Supply Odor Universe Mike Riddle 816-718-9136 OdorUniverse.com

Contractor Supply Sherwin Williams Mike Steiner 816-589-8506 SherwinWilliams.com

Hard Money Great Plains Funding George Hersch 913-735-6605 GreatPlainsFunding.com

Hard Money

Investor Choice Funding

Dave Williams

303-500

-7088

InvestorsChoiceFunding.com

Hard Money Kansas City Investor Funding JJ Pawlowski 816-916-4593 KCInvestorFunding.com

Hard Money Longhorn Investments Mike Friedl 913-634-6386 LonghornInvestments.com

Home Buyer kcmoHomeBuyer Don Tucker 816-200-2198 kcmoHomeBuyer.com

Insurance Asset Protection Insurance Lisa Goodner 877-752-2742 APIAProtects.com

Investor 3B Real Estate Investments Bob Hult 913-940-0992 3BREI.com

Mortgage Pulaski Bank Beth Langston 816-234-8660 PulaskiBank.com

Realty Realty Resource Staff 816-523-4400 RealtyResourceKC.com

Realty & Management

Arrow Realty

Candace Davis

913-956

-5003

ArrowRealtyKC.com

Realty & Management Executive Asset Realty Group Jim Goodwin 816-866-1159 ExecutiveAssetRealty.com

Realty & Management Home Rental Services Kandy Meehan 913-469-6633 Home4Rent.com

Realty & Management Jamieson Home Team Kevin Jamieson 913-384-8331 JaimesonHomeTeam.com

Security COPR Security Geoff Miles 816-398-4045 COPRcage.com

Title & Escrow Accurate Title David Green 913-338-0100 AccurateTitleCo.com

Title & Escrow Alpha Title Patsy Archer 913-498-8999 AlphaTitleLLC.net

Title & Escrow Continental Title Sharon Bower 913-744-7011 CTitle.com

Next Month: Wholesaling Houses With Vena Jones Cox

See full details on all Business Associates at MAREI.org/Business-Directory/

Mid - America Association of Real Estate Investors does not render legal, tax, economic or investment advice. All pro-

grams, properties and services are provided with the understanding that Association is not engaged in rendering legal, tax,

or other professional services. If legal, tax or other expert assistance is required, the services of a competent professional

should be sought. Everyone should complete their own due diligence!


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Contact Us

Learn more aboutMid- America Associationof Real Estate Investors

Chapter of National REIA

Kansas City Office 8014 State Line Rd,Suite 210Leawood, KS 66208

(913) 815-0111

[email protected]

Visit us on the web atwww.MAREI.org

A Trade Association for Real Estate Professionals

For landlords, wholesalers, rehabbers, note sellers, multifamily investors,exchangers or anyone else who use real estate as a way to build

wealth. We welcome full time investors as well as those just getting start-

ed or people who provide a product or service to the industry.

With something for everyone from beginner to pro!

The experienced real estate professional will find the support they need stay in-

formed of the issues and tools to take action. The new investor will find the edu-

cation they need to get started and the products, services and connections to build

profitable businesses. The product or service provider that caters to the real es-

tate industry will find active professionals who need their services. And everyone

benefits from our community, from live meetings and events to our very vibrant

social media destinations. Please join us . . . .

Member Discounts Home Depot 2% Rebate

Sherwin Williams Discount Card

Office Depot Max Discount Card

Rentals.com 20% Off Reg Price

ISC Tenant Screening

More . . . .

Meeting Location MAREI Meets every 2nd Tuesday at the Holiday Inn & Suites at 8787 ReederRoad in Overland Park, KS. Conveniently located just off 69 & I35 Highwaysat 87th Street.

Meeting Agenda

6:00 pm: Networking & Vendors 6:00 pm: Announcements & Introductions 7:30 pm: Why (& how) You Should Buy & Hold with Stewardship Properties 9:30 pm: Late Night Networking in the Lounge February Meeting on 8th Floor in Sunset Ballroom

the investment news - february 2014

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