Let’s face it, most people dream of hitting it big and making millions, with visions of an early retirement and traveling the globe flitting through their minds. For many, these daydreams could also involve winning the lottery, or coming into an inheritance from a very wealthy relative that they’ve never met. But for those who have hit it big, there’s one constant: hard work. Whether they’re real estate investors, stock brokers, or Hollywood superstars, hours upon hours of work and “paying their dues” have gone into everything they’ve done. And for many of them the work continues – and in some cases, becomes even more intense – once they’ve actually fulfilled their dreams.
Below, we’ll take a look at two real estate investors who have made millions (and in one case billions), and find out some of their secrets to success.
The one thing that each of these people has in common is that to fund their projects – whether it was their first or their 1,000th – they’ve had to take out loans. And those loans aren’t necessarily coming from traditional banks holding the note to a 30-year mortgage. Especially in the cases where deals are closing extremely quickly, these funds may be coming in the form of hard money loans.
If you’re interested in getting into real estate investing without doing all of the nitty gritty, you can be one of the people behind the scenes, funding these projects and making returns on your investment once the property sells or as the property progresses and interest is being collected. Investing in real estate by funding deals, especially with a company like Walnut Street Finance, is a great way to add diversity to your investment portfolio. Not only will you be investing in real estate rather than stocks and bonds, but at Walnut Street we also ensure that your investments are spread across a variety of investments, so that your risk is lowered.
While Bren isn’t a true rags to riches story (his father was a successful movie producer and, after his parents divorced, his mother married steel tycoon Earle M. Jorgensen) he did start his company the same way many successful real estate investors do today – by taking out a loan. In 1958 Bren used $10,000 (equivalent to nearly $85,000 today) to build his first property. Later that same year, he founded his first company – the Bren Company – and began building homes in Orange County, California. Just five years later, in 1963, Bren was clearly on the path to success – buying over 10,000 acres to plan and develop Mission Viejo, California. Yes, that’s right – he built an entire city. Since then he has secured a real estate empire that is estimated to own approximately 115,000,000 square feet of residential property in Southern California alone.
In a 2011 interview Bren summed up his real estate advice with these words, “What I learned was that when you hold property over the long term, you’re able to create better values and you have something tangible to show for it.”
Tarek and Christina El Moussa
If you’re interested in the fix and flip industry, it’s likely that the El Moussas are quite familiar to you. The stars of HGTV’s Flip or Flop, Tarek and Christina El Moussa, got their start as real estate investors by first working as real estate agents in Southern California. When the market tanked in 2008, they stayed in the real estate industry – something many agents were unable to do – by shifting their focus. Orange County, CA had, and still has, one of the highest foreclosure rates in the entire country, which meant that while buying and selling may not have been enough to pay the bills, fixing and flipping was.
If you’re a fan of their show, you may have seen that they’re very frequently calling in deals quickly – sometimes they’re purchasing houses at auction, but the majority of the time they’re driving by properties, peeking in windows, and calling the listing agent on the spot to make a cash offer and close the deal within a matter of days. Of course, these transactions probably have a bit of movie-magic applied to them, but for the most part, transactions really can move that quickly in the fix and flip world, and securing hard money loans is one of the quickest ways to ensure that you’re able to secure the funding for your next project as quickly as possible.
All told, the path to success as a real estate investor isn’t guaranteed – but with hard work, dedication, and the right team behind you, you can certainly achieve great things. If you’re interested in investing your money with Walnut Street Finance, get in touch!