How I Found A Real Life Infinite Money Glitch

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Ken McElroy

Ken McElroy

3 ай бұрын

To download the report mentioned in the video, follow this link: kenmcelroy.com/infinite-retur...
In this video, Ken McElroy explains the 'Infinite Return Strategy' using a 265-unit project from his company, MC Companies, as a real-life case study. He details the process of enhancing value through strategic renovations and refinancing. He explains how this approach can apply to any business or real estate venture, resulting in significant, tax-free profits and cash flow improvements.
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Ken is the author of the bestselling books The ABC’s of Real Estate Investing, The Advanced Guide to Real Estate Investing, The ABC’s of Property Management, and has an upcoming book: "ABCs of Buying Rental Property: How You Can Achieve Financial Freedom in Five Years." Ken is a Rich Dad Advisor.
Ken offers a wealth of personal experiences, practical advice, success stories, and even some informative setbacks, all presented here to educate and inspire. Whether you’re a new or seasoned investor, the information and resources on this channel will set you on a path where you and your investments can thrive.
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#kenmcelroy #realestate #realestateinvesting #InfiniteReturn #InvestmentStrategy #RealEstate #ValueAdd #Refinancing #CashFlow #Depreciation #TaxBenefits #Equity #NetOperatingIncome #Profit #BusinessScaling #CapitalizationRates #InterestRates #MarketTrends #AssetValueIncrease #DebtManagement #FinancialGrowth #RentalMarket #ValueCreation

Пікірлер: 216
@KenMcElroy
@KenMcElroy 2 ай бұрын
If you enjoy this kind of video, please share it with someone you think would benefit. It would really help us and encourage Ken to create more videos like this! Thanks, guys!
@jimdandy8996
@jimdandy8996 2 ай бұрын
Where is the link to the free report Ken?
@DCC72
@DCC72 2 ай бұрын
Thank you: First, let me say....Ken is great because his podcast do not feel like its a funnel to a sale he's trying to make. Eventually, someone will convince him to push people to a funnel, and we'll look for the next seemingly genuine (i.e., non-used-car sales) expert. Ken also shows his back of the envelope calculations in plain sight, which shows his confidence and transparency. Now on to my question about saying "": I do not understand why Ken says... in Yr6, when you use the $25M loan to repay the $20M debt from Yr.3, the remaining $5M can be distributed to the investors as . How can that be pure profit when everyone is on the hook for the $5M debt? What is a pandemic tanks the cash flow, won't the banks come after their $5M from the investors? If so, then it does not seem like it's "pure profit". It's actually just surplus money (e.g., capital) available to investors because it's not needed to pay for the property since it is cash flowing.
@jerrysouthwick
@jerrysouthwick 2 ай бұрын
Why does real estate generally appreciate in value if the building is getting older? Why don't cars and trucks do the same thing?
@JohnT.-vy7wp
@JohnT.-vy7wp 2 ай бұрын
Its not considered pure profit because your not taxed on the money. Profit from a business is taxable, when using a cash-out refi you don't have to pay taxes on it. Just like if you cash out refinance your personal home, say they give you 100k, you don't report that as income to the IRS instead you use it like money in the bank. Of course that increases expenses but given it cash flows positive before, it just reduces the amount of cash flow@@DCC72
@AamirEhsan
@AamirEhsan 2 ай бұрын
@@DCC72I wondered the same, but I think the increased debt is amply serviced by the rents in perpetuity. They don’t distribute the entire equity increase and keep a cushion for market swings.
@LewisAtonn
@LewisAtonn 7 күн бұрын
I squirelled away cash for a rainy day, but with inflation pouring down, it feels more like a leaky bucket. Saving for retirement seems impossible if my money keeps losing value faster than I can earn it.
@tomaszcz_k
@tomaszcz_k 7 күн бұрын
Financial consultants can help by recommending investments that outpace inflation, such as real estate or certain stocks. A client of mine followed this strategy and saw their savings grow by 15_% in just two years, effectively countering inflation.
@LewisAtonn
@LewisAtonn 7 күн бұрын
That makes sense. Unlike us, you seem to have the market figured out. Who is your fiduciary?
@tomaszcz_k
@tomaszcz_k 7 күн бұрын
Dustin Dwain King is my asset manager. Just research his name to find the details and set up an appointment.
@LewisAtonn
@LewisAtonn 7 күн бұрын
I copied his name and pasted it into my browser; his website came up immediately, and his qualifications are excellent. Thank you for sharing.
@laiibrahim7502
@laiibrahim7502 7 күн бұрын
Experts like Dustin Dwain King provide extensive knowledge and experience, helping clients craft tailored financial strategies to achieve their goals. Recognising the importance of expert guidance is crucial for effective management and risk mitigation.
@andersonbasdao4923
@andersonbasdao4923 2 ай бұрын
He just doesn't say how much was spent to renovate every single unit in order to raise rent $150. That's a key part of the equation.
@mattb383
@mattb383 2 ай бұрын
Most likely done through the cashflow it generated.
@mikev4373
@mikev4373 2 ай бұрын
Indeed.
@onlinestorytime6875
@onlinestorytime6875 2 ай бұрын
I thought he said he didn't need to do much to the property.
@johnheath8882
@johnheath8882 2 ай бұрын
Reinvesting his cashflow thus reducing or negating profit entirely(for the first 3 yrs). The other rent increases were inflationary.
@voroshenri
@voroshenri 2 ай бұрын
Also that $150 was 57% increase which most market couldn't sustain. They could do it one time, but that's it, they cant raise it again and again because they soon run out of renters. And for a second lets focus on the fact that they increased the rent with 115% in 6 years... That's insane and not a sustainable model at all.
@obsoleteprofessor2034
@obsoleteprofessor2034 2 ай бұрын
My dad used to pay all utilities on his 16 unit. We rewired the place all electric deleted the gas and separated water/sewer/trash...slapped on paint, carpet and repaved the parking lot. Tenants saw a $200-$400/mo increase in costs for utilities alone with no increase in rent. As tenants turned over we deleted the stoves and fridges. We get a waaay better tenant. Out of 100 rentals we had only 2 withhold rent during koovid. They got evicted after the moratorium but later came back because they couldn't find any place to stay. They offered paying the arrears but we told them too stick it. One sued me for discrimination with Calif housing board. Board wanted me to pay a fine to the Board to "settle" (tenant gets nothing). Woman told me it was cheaper to pay than drag it out. I told her I rather pay for "good" than reward evil. Tenant dropped complaint but Board continued. It cost me $80k for attorney to have case dropped.
@RealLifeFinance
@RealLifeFinance 2 ай бұрын
Jeez
@obsoleteprofessor2034
@obsoleteprofessor2034 2 ай бұрын
@@RealLifeFinance What's funny is that the trash company wouldn't give us one dumpster with daily service. Instead, they brought out green/brown/blue mini bins for each unit (grass/trash/recyclable). 48 bins on the street on trash day.... plus each tenant has to keep the bins inside on non service days. No tenant generates green because I do the landscaping.
@humblebee7979
@humblebee7979 2 ай бұрын
Wow, that's disgusting.
@TruthAboveEmotion
@TruthAboveEmotion 2 ай бұрын
There are about 48 states that will treat you better than that one does. 👊😎
@leviborbely9727
@leviborbely9727 2 ай бұрын
It is your property, you can discriminate as much as you want imho
@5678seth
@5678seth 2 ай бұрын
I've done this exact same thing just on a much smaller scale I borrowed money purchase property fixed it up refi it back out using none of your own money now I have all my money back plus properties cash flow and ready to buy some more this really does work just take your time and find the right deals
@eddiemalvin
@eddiemalvin 2 ай бұрын
But what happens if/when you sell after several years of taking depreciation. Wouldn't the outstanding mortgage and capital gains from a much lower cost basis potentially put you into a negative situation? I guess if you're cash-flow positive, you just hold them forever.
@jrp6313
@jrp6313 2 ай бұрын
​@eddiemalvin I'm just learning about this stuff... but maybe.. that is when you incorporate a 1031 exchange. I think that's what it is called.
@Johndoe-qn9jr
@Johndoe-qn9jr 2 ай бұрын
Who willl lend you the money that thw bank dont cpver and what percent gain will they get ? Also what is the risk onvolved into this ? Thank you
@TheMrPorter
@TheMrPorter 2 ай бұрын
@@Johndoe-qn9jr Hard money lender or private lender.
@Johndoe-qn9jr
@Johndoe-qn9jr 2 ай бұрын
@@TheMrPorter what intrest rste do the normaly get and where to find them ? Thank you
@Danny-fs1hk
@Danny-fs1hk 2 ай бұрын
Ken McElroy is a master teacher!
@Teolulz
@Teolulz 2 ай бұрын
I like this new format! short and straight to the point 👍
@ctech6049
@ctech6049 2 ай бұрын
Thank you!
@therealestake
@therealestake 2 ай бұрын
Another great lesson with Uncle Ken. Keep em coming!
@syedrehanfida
@syedrehanfida 2 ай бұрын
Thank you for sharing this info!
@michaelmoncal1190
@michaelmoncal1190 2 ай бұрын
thank you ken
@E.White_Jr
@E.White_Jr 2 ай бұрын
Are these type of evaluations in his book? This is great!
@michaelsontheimer960
@michaelsontheimer960 2 ай бұрын
I love the new format Ken! Keep up the great work!
@mondavou9408
@mondavou9408 2 ай бұрын
Good job on the video. Nice, Simple, Clear and to the Point.
@60crown
@60crown 2 ай бұрын
Great video. Thanks Ken.
@failforwardfast8609
@failforwardfast8609 2 ай бұрын
Thank you Ken!
@kevinsoxx
@kevinsoxx 2 ай бұрын
Thank you Ken.
@philosophyforum4668
@philosophyforum4668 2 ай бұрын
So if 400K is the annual interest due on 15M, that's a pretty low interest rate - around 2.7%. Dont think you can get that now.
@Youngquavo2
@Youngquavo2 2 ай бұрын
What about operating expenses where does that come into play?
@iGotViet
@iGotViet 2 ай бұрын
Hey Ken! Is it standard to pay the interest on equity? Is that calculated into your monthly payment?
@freejakk
@freejakk 2 ай бұрын
This is the clearest explanation of proper real estate investment that I've ever watched. Thanks Ken!
@themultifamilywealthpodcast
@themultifamilywealthpodcast 2 ай бұрын
Such a great watch! The section on maximizing property value through strategic financial planning really got me thinking. For fellow multifamily investors, our channel is packed with invaluable insights and strategies.
@PhilippLang
@PhilippLang 2 ай бұрын
Thank you for your videos Ken! Quick question. In this video you did a cash out refinance. How did you finance the mortgage with the bank? Was it a fix loan or variabel? Do you know what I mean?
@EXPLORESEATTLELIVING
@EXPLORESEATTLELIVING 2 ай бұрын
Question - Since you are an expert operator, are you seeing any risk as your existing loans are maturing right now or all good because rents have increased over the 10 year loan term to increase NOI? So maybe no additional cash out refi possible on next round due to increase in rates, but you can appraise ok to just refi out existing loan maturity? So, rents when up enough over 10 year loan term to cover downside of higher rates, yes? How can I invest in your deals?
@vitscosta
@vitscosta 2 ай бұрын
What about CAPEX, considering $500k yearly depreciation??
@user-vd5lt9wv9t
@user-vd5lt9wv9t 2 ай бұрын
Love this!!!!!
@GpconnectInfohotspot
@GpconnectInfohotspot 2 ай бұрын
you get the loan to refinance from the same bank or a different one each time ? so basically their is no end game unless your sell the property ?
@dutchcrunch91
@dutchcrunch91 2 ай бұрын
Yep! Never sell the property, just keep 1031 exchanging the properties to avoid capital gains tax on the profit and then it goes to your kids at the fair value (bump up in basis) at the time you die so they never pay taxes on the gain either. Win win win
@clayjones1933
@clayjones1933 2 ай бұрын
You can’t 1031 a refi. A 1031 is for selling. And it’s only held there a short amount of time before you either put it toward another investment property. If not you pay the gains tax.
@jaimegranero9027
@jaimegranero9027 21 күн бұрын
Thats why their saying, you refi and if you want to sell then do 1031 that way you are not affected by the depreciation on that property you had​@@clayjones1933
@jimfischer4703
@jimfischer4703 2 ай бұрын
So good!
@EarlArmstrongJr
@EarlArmstrongJr 2 ай бұрын
Perfect timing, I found a property with similar value ads.
@tompat9166
@tompat9166 2 ай бұрын
hi ken, I watch all your depreciation videos. are you essentially only paying the bank, partners and yourself up to zero tax with dep? I'm really slow on this, do you ever go over or is that money invested in renovations?
@josephcook1276
@josephcook1276 2 ай бұрын
How or where did you get the money for the upgrades? The video doesn’t specify
@prudence_business
@prudence_business 2 ай бұрын
Amazing video❤
@brianlenberg4310
@brianlenberg4310 2 ай бұрын
Thanks ken
@user-vd5lt9wv9t
@user-vd5lt9wv9t 2 ай бұрын
Let’s see an example of a small multifamily where you harvest equity to purchase a larger one for people that are starting out and want to grow in property count
@HelloCurve111
@HelloCurve111 2 ай бұрын
Do you take the depreciation all at once or is it over the 27.5 years? Thanks for the info!
@GALTIZER2003
@GALTIZER2003 2 ай бұрын
Thank you, Ken how can a small investor start doing this and how do I find other investors who are ready to get onboard?
@ens8280
@ens8280 Ай бұрын
Congrats - you explained basic real estate finance. Just FYI - Be wary of interest tracing rules, along with the debt-financed distribution rules. You’re likely losing 20% of the entity’s interest deduction in this scenario ($1MM of $5MM debt used for distributions), and hoping the partners can use this separately stated item on their personal returns.
@Guedimin
@Guedimin 2 ай бұрын
100% true.
@Convert96
@Convert96 2 ай бұрын
Excellent!
@tedrick4713
@tedrick4713 2 ай бұрын
Good stuff
@antonkaufmann9848
@antonkaufmann9848 28 күн бұрын
Ken, thank you for your free, but highly valuable Advice! Question: In year 6, the building is valued at 35M. Based on this valuation, you were able to get a refinancing loan of 20M. What if the value of the building in year 7 is valuated at 20M only. Would the bank react and ask you for more, either other securities or change the contract completely?
@tomwilliams9888
@tomwilliams9888 2 ай бұрын
The loan interest rate, initially was $400,000 on $15m which is 2.66% assuming it was an interest only loan. You can't get that now by a long shot. So you need to do these deals when interest rates are a lot lower than now. And then factor in the cost of paying back the principal.
@user-vd5lt9wv9t
@user-vd5lt9wv9t 2 ай бұрын
my man❤❤❤
@danarobinson6156
@danarobinson6156 2 ай бұрын
Frickin Brilliant 🎉
@diegoag85
@diegoag85 2 ай бұрын
Where are the costs for repairing it? Maintenance? All costs involved.. isn’t it reducing your cash flow? Did I miss something?
@absolutecrypto95
@absolutecrypto95 2 ай бұрын
hey Ken do you teach any classes ?
@RussManK3
@RussManK3 19 күн бұрын
I need to learn this
@KeithPatton
@KeithPatton 2 ай бұрын
Also what about the interest on each bank debt? 15M (original loan debt) + 4M (borrowed equity) + 1M (equity returns) = 20M (new loan debt). But what pays the interest on 15M (original loan debt)?
@PeterKontor
@PeterKontor 2 ай бұрын
Where is the cost of repairs in this formula?
@cbbcbb6803
@cbbcbb6803 2 ай бұрын
What about having only two or three unoccupied houses that need renovation. What "other people's" money can you get to pay for renovation? Where do you get that money?
@Johndoe-qn9jr
@Johndoe-qn9jr 2 ай бұрын
Can you make a video about how to make the papers nice for the banks you aprove your loan on the real estates ? and also how to find the investor that will lend you the rest of the money that the bank dont lend you ? Thank You
@kf589
@kf589 2 ай бұрын
Leverage does amazing things in both directions. Start small and don't let accidental luck give you confidence.
@gregs9966
@gregs9966 2 ай бұрын
Love your videos and books, Ken! I know you are using rounded numbers for this example, but I just don't see how your annual loan payment can only be $400k on a $15 million loan. Assuming a traditional commercial loan, even at 0% interest, the monthly payment is at a minimum $50,000 or $600,000 annually. What am I missing here?
@LetterSignedBy51SpiesWasA-Coup
@LetterSignedBy51SpiesWasA-Coup 2 ай бұрын
And when interest rates rise? Forget the cash out refi and expect a call from the bank to give them more money when the LTV goes down... or hand over the keys.
@huestifer
@huestifer 2 ай бұрын
Yep 8:04
@mrwangkai
@mrwangkai 25 күн бұрын
Not sure if that's quite a glitch. The main difference from BRRR and burden on the owner is generating "significant cash flow". Would love to know how you can have more control/influence over this.
@davidlyash5217
@davidlyash5217 2 ай бұрын
When you are taking out the $25 million dollar loan to pay off the original $20 million loan don’t you need another downpaymwnt of $5 million - which you need to raise again and thus can’t be “infinite”. Am I missing something here? Can someone elaborate?
@plove3368
@plove3368 2 ай бұрын
The property is worth 35mil when they take out the 25mil so there’s enough equity that doesn’t require a down payment
@mickaelm87
@mickaelm87 2 ай бұрын
Can someone explain to me where is the cost spent to increase the value of each units by 100$/month ? It must be at least a million $
@clayjones1933
@clayjones1933 2 ай бұрын
It’s not real. He did the same video about 4 years ago. The only thing different in that video was it took 9 years and his cash flow was $600k with the same $500k depreciation and he owed $100k in taxes. Do what you want with it, but I call bullshit!
@siulanainad
@siulanainad 2 ай бұрын
So it appears that you are planning on settling the tax bill when you sell the property. That is a valid strategy too. Can you show what strategy would you use at selling time? Thank you. Let me know if I am missing something please.
@mhusa2911
@mhusa2911 2 ай бұрын
you never sell... "buy 'til you die". you live off the cashflow and cashout refi tax free in perpetuity. selling is silly.
@siulanainad
@siulanainad 2 ай бұрын
@@mhusa2911 Thanks but that's not my question. There is a capital gains tax that will have to be dealt with. If he "dies" like you say, property receives a stepped up basis to the heirs. That's obvious. My question is how is he planning to handle that if he wants out before dying. So my question still has not been answered by him.
@siulanainad
@siulanainad 2 ай бұрын
And, yes I am aware of 1035ing it if he wants as a potential solution.
@mhusa2911
@mhusa2911 2 ай бұрын
@@siulanainad Thats why i said it's ***"Buy 'til you Die"***. You dont ever sell and you DONT NEED TO SELL. you can always extract 70% of building equity by cash out refi, which almost always returns all capital after about 3 to 5 years, and you get infinite cash flow until you die. Rinse repeat. when you can our refi, you push the cash as a down payment for a new asset, and eventually this loop produces a cash out refi ladder similar to a CD Ladder, but with much higher rates of return. while you wait for the cash out refi from any individual building, you are cashflowing in the meanwhile. Also, You can drop the assets into irrevocable living trusts, and avoid step up in basis to heirs. I wouldnt want my heirs getting this undisciplined hands on the portfolio. Better to setup a trust and ensure the heirs live off the cashflow, same as you do. if you need to sell for some technical reason, you can always 1031 into a newer bigger property.
@iamthegreatiam2075
@iamthegreatiam2075 2 ай бұрын
@@siulanainad considering made money doing just this and won’t pay capital gains taxes ever, nor will my children. You need to raise one of them at least to have a brain though. You realize you can have this ran through a foundation, and just appoint your kid as your replacement right ? Charity can be renovating your own low income properties, increasing your cash flow and net. It’s literally an infinite cash loop.
@gaylewashburn1137
@gaylewashburn1137 2 ай бұрын
So rents more than doubled over the six years? With the homeless situation and the way hedge funds have escalated rents, does anyone consider the impact on renters of their rent overhead doubling in a few years?
@NatureandSpirit111
@NatureandSpirit111 2 ай бұрын
How would you do this with something other than property?
@iamthegreatiam2075
@iamthegreatiam2075 2 ай бұрын
There’s no physical asset so need a different strategy
@cluberic
@cluberic 2 ай бұрын
Just one problem....how do you find someone with $millions to invest with you?
@scottcoleman5088
@scottcoleman5088 2 ай бұрын
Ask 100 people and find out how much you learn. After asking 100 people, you will be a different person. And each day while you're doing this, take cold showers too. Just 3 minutes, you won't believe the change in your life.
@ericjames7819
@ericjames7819 2 ай бұрын
The question is how to get the prior experience doing this successfully so that people will invest with you. They don't give millions to someone without significant experience.
@obie1coby
@obie1coby 2 ай бұрын
There's a ton of books in syndicating
@ericjames7819
@ericjames7819 2 ай бұрын
@@obie1coby reading books isn't experience. No one is giving millions of dollars to someone who has read books about syndicating.
@atmos4197
@atmos4197 2 ай бұрын
That’s not where he started. You start with something smaller OR you invest your money with a group of other investors with someone like Ken’s organization. There are many out there. But it’s a 3-5 year commitment.
@naxis5000
@naxis5000 8 күн бұрын
Depreciation - Just to say that depreciation is not tax deductible in most countries. As example, the UK. Still a great video though.
@dmustakasjr
@dmustakasjr 25 күн бұрын
Ken is like a “Dave Ramsey” that never lost it all.
@daneludolph9014
@daneludolph9014 2 ай бұрын
@kenmcelroy You did not mention the cost of the “value add” at any point in this video? The cost of renovating 265 units, cost of labor, and vacancy cost to displace that many tenants. How are you not going to factor that into your cute little equation here pal??
@jchong416
@jchong416 2 ай бұрын
I just wish I lived in a city that cash flows
@KeithPatton
@KeithPatton 2 ай бұрын
But what about the $25M debt owed to the bank from year 6?
@Johndoe-qn9jr
@Johndoe-qn9jr 2 ай бұрын
I dont fully understand what does you get at the end of year 6 ? what does the investor get out from it at year 6 he that put up the first 4 million that the bank did not cover ? Thank You
@nicerides9224
@nicerides9224 2 ай бұрын
When he went back to the bank for a refinance they loaned enough to pay back original debt plus what the investors put in plus a million over that. So he returned the original equity and the property was still generating income and tax benefits. At the second refinance there was 5 million profit after paying back the refinance done at year 3 which I assume was split amongst investors plus they still had cash flow from the property. I think they did pretty well. The renters not so much.
@Johndoe-qn9jr
@Johndoe-qn9jr 2 ай бұрын
@@nicerides9224 thank you. Do you know of a video that wxålains things like this in more details ? And what can the invwstors get for deals as this in percent returns ?
@manuelcisneros5974
@manuelcisneros5974 2 ай бұрын
how do you tell or add value to an empty property if it is not rented yet or how to convince the bank or loaners to give you the money thanks, example I saw a property for I million in California with 3 houses on it and I want to purchase it and the payment is around 6k monthly 20 percent down but I know I can rent the 3 houses for 7500-8500 with extra land for them to use for horses or cattle, goergeous land winery potential, 1 .5 hr from Sacramento here is the catch two of the homes need minor repairs and are mobile homes but the land is 168 acres in Amador county, bank won't loan because the condition and age of the homes and it is probably worth around 600k for the land only
@iamthegreatiam2075
@iamthegreatiam2075 2 ай бұрын
Just answered your own questions. Selling for 1 million, only worth 600k.
@AEVMU
@AEVMU 2 ай бұрын
Love how you can depreriate things more than they actually depreciate.
@Roman49837
@Roman49837 2 ай бұрын
What I don’t understand is why would you go trough all this trouble and risk if you could instead just buy an ETF like JEPQ and get a ~10% return (instead of a 7.5%)… even if the ETF price stayed the same? (Which doesn’t, but just to be conservative), am I missing anything here? Then at the end of 6 years you have $2.6 MM which translates (roughly) to ~10% over the original $4 MM. I haven’t done the whole math but I think you would still come ahead with an ETF, even after factoring taxes.
@NCACDT
@NCACDT 2 ай бұрын
Your lines and language and filter is something everyone can learn show them how to learn your language keep it simple MC.
@JOMOPressureWash
@JOMOPressureWash 2 ай бұрын
NOICE
@jordy_beats2980
@jordy_beats2980 2 ай бұрын
So then how do you get paid Ken? You paid off investors by year 3. Are they paying you to manage during these years as well? After their capital is returned do you now participate in cash flow? Is there some sort of split going on?
@gptech2444
@gptech2444 2 ай бұрын
Ken, It's not clear where your cut is in this scenario. Any cash from the re-fi and rent goes to the original investors that provided the $4m. Could you explain where you make your money in this deal apart from owning the property? Also, this type of deal is near on impossible to find in Australia.
@johnheath8882
@johnheath8882 2 ай бұрын
Its all his money, investment and profit. The original investors are imaginary and used to make this scenario seem obtainable. You have to be rich already to acquire investors who'd lend you 4mil Australia will likely get worse. Relocate
@gptech2444
@gptech2444 2 ай бұрын
@@johnheath8882 He talks about using OPM and not his own money. I agree about Australia, relocating isn't easy as we're not regarded as 3rd world yet.
@maziyarsabet5947
@maziyarsabet5947 2 ай бұрын
The strategy might be less effective in a high mortgage rate environment.
@Cyber_Samurai
@Cyber_Samurai 2 ай бұрын
You need a good track record in order to do this deal.
@Visiondrivenllc
@Visiondrivenllc 2 ай бұрын
This guy is the real deal
@erickcoley7554
@erickcoley7554 2 ай бұрын
Why can’t you come up with a way for the little guy to invest with you Ken?
@vazybelek
@vazybelek 2 ай бұрын
At current interest rates, this strategy put you deep in the red. This can only work in times of free money, but unfortunately those times are over.
@sidshri6080
@sidshri6080 2 ай бұрын
Why would anyone sell 300K cashflow property? Isnt it too cheesy, but I do love free money
@erkonline1
@erkonline1 2 ай бұрын
In what world is the payment on $15M 400K? The interest alone is way more.
@Touchit344
@Touchit344 2 ай бұрын
👀
@clayjones1933
@clayjones1933 2 ай бұрын
This is the same video from about 4 years ago isn’t it? The differences in the older video were it took 9 years instead of 6 and with the last refi, the cash flow was $600k with the same $500k depreciation so he owed $100k in taxes. I still call BS!
@quinnritiqal819
@quinnritiqal819 2 ай бұрын
I see rent income go from 700k to 1.5MM over 6 years. So you more than doubled the rents on everyone over 6 years? That's absolutely great, I'm sure the tenants who had to move somewhere else because they couldn't afford to live there any more thanked you. Now imagine if everyone was doing this... rents would be going through the roof, everyone can barely afford to live, but YOU are making a boatload of cash. Oh, wait... isn't that what's been happening???
@_Alex29_
@_Alex29_ 20 күн бұрын
Helo guis it is realidad
@XxN8iVeSc0uTxX
@XxN8iVeSc0uTxX 2 ай бұрын
Problem with the economy is upped rent costs this dudes a monster
@j01237
@j01237 2 ай бұрын
Infinite....just pay $10 million payment monthly...
@nickdoubek6448
@nickdoubek6448 Ай бұрын
Increase $150 every month, how is it possible to raise so much and keep tenants?
@aiko3423
@aiko3423 2 ай бұрын
Wow....but isn't there interet on the initial 15 million and also the 20 million?
@forestlawn3187
@forestlawn3187 2 ай бұрын
You pay off the 15million with the 20mill and you have 5mill left over and your paying interest on the 20million but he has positive cash flow so I guess it works I’m kinda trying to figure it out myself but that’s what I got out of it lol 😂
@adventurebabyboomer7318
@adventurebabyboomer7318 15 күн бұрын
This model provides cash flow. Regardless, there is limited Equity on the property. This is what is fueling the "Econoimic Debt Cycle" in our culture. Too much debt- people and banks are over-extended. Not responisble.
@polok890
@polok890 2 ай бұрын
Yah, your charging 2 to 3 times more than whats fair rent. Thats why you have a high turnover. And twice the amount of a home mortgage in a normal market
@mattyb1624
@mattyb1624 26 күн бұрын
Sooo.... you just keep increasing your debt?
@durfeecoach1
@durfeecoach1 2 ай бұрын
I just don't agree with rents just going up every month. This is why things are so tough. Investors just keep looking to get 100% of your money. Use to be if you worked fulltime you could afford an apartment and save up for a home. Now you have to share an apartment with multiple people and hope rent doesn't go up the next year because your two jobs can't afford it.
@danmcnamara3287
@danmcnamara3287 2 ай бұрын
Fails to mention or consider the capital improvements required to reposition the property the achieve the higher rents, vacancy during the renovation of units under construction and turnover of units by those who cannot afford or qualify for more monthly rent expense.
@onlinestorytime6875
@onlinestorytime6875 2 ай бұрын
He said it wasn't a value add.
@bensmith4563
@bensmith4563 19 күн бұрын
Debt is the ultimate weapon used the right way you get rich used wrong you just stay broke forever
@WorldsBestGuys
@WorldsBestGuys 2 ай бұрын
I think this channel is dedicated to getting other peoples money. If values of buildings fall, competition from other new rentals enters driving rents down, then what are you supposed to do with that giant ass loan? Bankruptcy? Investing channels suck… just con men
@billstidams6658
@billstidams6658 2 ай бұрын
Wonder how many of those families had to move because they couldn’t afford to live there anymore with the constant rent increases..
@dominicd7610
@dominicd7610 2 ай бұрын
You do realize that the price of maintaining the apartments/upgrades etc has increased with the rising inflation,right?
@tombrown9460
@tombrown9460 2 ай бұрын
Inflation defined
@madvillainy6845
@madvillainy6845 2 ай бұрын
Real Estate has made a lot of millionaires. It won't matter for you, if you're not into it.
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