Category Archives: Prosperity Mindset

Raising the Bar in Real Estate



In a world without flaws, people are honorable in their business dealings, and life in general. There is a spirit of abundance, open communication, and collaboration towards a common goal. There is good will, and good faith. Honorable people deal with each other honorably by talking straight about all material issues; they deal equitably with each other by seeking first to understand before seeking understanding, and establishing clear expectations with mutually agreed rules of engagement to nurture mutual respect, consideration, efficient business dealings, and eventually, mutual trust.

Under-Handed Tactics Benefit Nothing and No One

When people use under-handed tactics to gain an advantage; when they add questionable items in their agreements and avoid addressing the concerns or questions; when they expect someone to produce results or work without any assurance of compensation, they are operating in ways that are less-than-honorable; it is the mark of a fearful and protective soul with bad intentions.

In an industry where people will no doubt run into each other again over the course of doing business, it is worth the time and effort it takes to communicate in a manner that does not diminish the value of the other person. It’s all about addressing the tough issues with the intention of maintaining and developing fruitful business relationships over time.

Aspiring Towards a New Norm

It is the quality of our relationships–whether business or personal–that makes life rewarding. Good relationships are worth the effort; the rewards are beyond measure and they are self-evident. It is about collaboration, and not competition; it is about aspiring to a spirit of abundance, and not adversarialism. We can raise the bar in our industry; we can change the landscape from cut-throat to cooperation, and we can all still thrive regardless of any differences we might have. We can do this!

Intriguing Class Discussion: Three Feet from Gold



The story about Three Feet from Gold is a classic first brought to my attention by Napoleon Hill’s book, “Think and Grow Rich.” It illustrates how mindset can rob us of our loftiest desires in life. I think of life, family, career, and the lifelong pursuit of reaching for that ideal vision of reality.

Today, in class, the teacher posed a question, and asked us to explain how it relates to business. That was a loaded question. Here is how I answered:

Three Feet from Gold

“I had learned, from years of experience with men, that when a man really DESIRES a thing so deeply that he is willing to stake his entire future on a single turn of the wheel in order to get it, he is sure to win” (Hill, 1937, p. 28)

Looking past the overt male references (it was the 1930s after all)….I believe these principles apply equally to women as they do to men; that when one works hard towards securing their ideal future, it is often a journey into the unknown–fraught with learning curves that can slow the pace of progress to a crawl. When the years roll by with one learning curve happening after another, a persons’ spirit can become weary and battle-worn from years of constant effort, because pursuing the promise of a better tomorrow is a quest that requires every bit of energy and resources we can muster and give—including patience, inner-strength, and self-discipline. To me, three feet from gold is going forward at full force and doing what is right and necessary even when we feel like things are absolutely hopeless, scary, or unfamiliar. The future is the Great Unknown, but we should not fear it. Instead, we should seek courage in the face of it–doing the best we can at every step. All we can do–and give–is our best at everything we do.

How we think will either propel us or sabotage us, and we CAN choose which path to take; many people do not choose and instead render themselves a product of fate and misfortune, which is sad to see because they end up living regretfully unfulfilled lives. We can’t expect perfection from ourselves all of the time, but we can choose to live each day with that burning desire so that we can, “desire a thing so deeply” that our paths will unfold in the direction to attain that which we so deeply desire; that ideal vision of life that we have worked so hard towards. It is there, we just have to believe it, desire it, and do the right thing with a patient but determined spirit until it becomes an evolving reality.

Hill, N. (1937). Think and Grow Rich. Floating Press.


|Equity Trust Company| Farmland Helps Client Grow his Financial Future

Interesting story….”Kurt Amundson has taken his real estate IRA rural to plant an investment that is already flourishing into quite a nest egg.Amundson used his knowledge about farmland to buy up land through his retirement account and rent it out to create a constant stream of passive income. The Starbuck, Minnesota, resident had bought and sold Iowa farmland outside of his IRA in the past but wanted to make a purchase with long-term benefits. “I thought buying the land with the IRA would be a good fit,” he says.Amundson funded most of the deal with his IRA money and took out a non-recourse loan to cover the balance. In July 2010, he purchased 40 acres of farmland for $1,750 per acre. The land gained him more than 6 percent in profits from the annual cash rent, but the investment’s real gain is in the property’s appreciation. It has appreciated to $2,700 per acre or more in one year. He already received an offer of $2,650 per acre.”

via kurt-amundson.

CORE VS. SUB-MARKETS: How Large Multifamily Investors are Leaving Money on the Table for the Smaller Investors

The Great Sub-Market Debate

Experienced real estate investors know that the investment value of a property is predetermined by the cash flows generated from the property. These cash flows are both incoming and outgoing. If the demographics surrounding the property are strong, this helps to reduce vacancies, thus improving the rate of uninterrupted cash flows during the holding period.

These are basic fundamental real estate principles. They are real, and they are timeless. It makes no difference if a property sits in a core market, or a sub-market. If the market is vibrant with strong employment, demographics, and the numbers make sense, then you know you have a deal worth considering. Oddly enough, many REITS shun properties located in sub-markets without even a second thought.

A Brief and Generic Case Study:

What if you found a property that could generate enough cash flows to produce a 34% return on investment within five years?

Let’s take a closer look at this scenario:

Here are the cash flow projections for this particular property:


Initial Equity (Year 0)    ($3,400,000.00)
Year 1    $405,404.00
Year 2    $477,993.00
Year 3    $549,149.00
Year 4    $625,329.00
Year 5    $706,891.00

Resale Value    $23,843,379.00

PV @ 15%    $22,621,466.24
Less Mortgage Bal    ($12,552,132.00)

Net Present Value    $10,069,334.24

Return on Investment of $3,400,000.00:    34%

Big Buyer Group Think: Location over Profitability

For all accounts and purposes, this looks like a profitable scenario. However, many institutional investors–including REITs–would not even look at this deal because it is located within a sub-market. I understand the perspective that asks the question, “Why should we pay a 6% cap rate for a property in a sub-market when we can purchase property at a 6% cap rate in a core market?” However, I would like to point something very important to all the smaller real estate investors out there. Leaving money on the table without consideration is a big mistake.

When smaller real estate investors begin to recognize the money that has been left on the table by the larger institutional buyers. It is indeed a “blue ocean” of opportunity, because the big companies are too inflexible and too rigid to recognize opportunity outside of their normal view of the way things are. In May of 2011, Mortgage Banking Magazine quoted Alan George–the CIO of apartment REIT Equity Residential, “…there were so little class-A assets. There were so few nationwide in core markets that it was a completely useless endeavor,” George said. “There are distressed assets, there still are in some of these tertiary markets, but who wants to buy those?”

I beg to differ by answering the question, “who would want to buy golden opportunities in strong submarkets?” Why, smart and experienced real estate investors would, because they know to look at the numbers and surrounding economic factors of the area. A strong market is a strong market whether it is a core or a sub-market.

To the smaller real estate multifamily investor, I say, there is a blue ocean waiting to be captured. Use the “big-buyer group think” syndrome to your advantage.

FHA will keep funding flips | Inman News

For the second year in a row, the Federal Housing Administration is extending a temporary waiver of its “anti-flipping” rule, meaning homebuyers relying on FHA-insured financing will continue to be able to buy homes that have changed hands in the last 90 days.The waiver is a boon for investors seeking to rehab and flip properties, because it expands the pool of eligible borrowers to include those relying on FHA-backed loans, popular with first-time homebuyers and others who lack the cash to make large down payments.

via FHA will keep funding flips | Inman News.

The Off-Market Multifamily Frenzy vs. Timeless Real Estate Investment Principles



This was my contribution to today’s class discussion in real estate finance:

Yes, it seems that only the most well-funded investment groups are taking full advantage of the current market. There are still a lot of investors sitting on the sidelines, but at some point, they will all need to realize that it still boils down to the numbers and how properties perform over the life of the holding period. Too much frenzy about “off-market” opportunities, and not enough energy spent on  considering real potential deals that are out there in this inhospitable economic environment.

I think a distressed deal is a distressed deal whether the deal is on or off the market. Even non-distressed deals can become distressed in this economic climate. Why? Because, sellers of non-distressed assets are going to have to compete with the tremendous volume of distressed assets that have–and have not yet–hit the market. The environment is bad for many sellers, especially the ones that cannot refinance for whatever reason.

Whether on the market, or off the market. All deals are competing for the same pool of investors. I think there is too much focus on finding off-market deals, and not enough energy going into considering the factors surrounding a real potential opportunity; for example, considering the fundamental basics of net operating income as it relates to an after-tax “cash-on-cash” return (the only real thing that really matters in the end is the actual cash flow that makes it into the bank). Taking the current economy into consideration, a savvy investment group knows how to step into a deal to make smart and well-informed decisions in order to achieve record revenue figures.

[VIDEO] What can I do with a small amount of money in a Self Directed IRA?

CLICK to enlarge image.


I found a very interesting educational video this morning. I thought it compelling enough to share. With knowledge comes the power to make positive changes. Real progress. How we choose to respond to circumstances determines the path ahead as well as the outcome–good or bad. By the way, I am not being paid to make this post. I am only sharing good information that has the power to make all the difference in the world for many people who concerned about the state of their retirement.  There are many educational resources out there that are free. Get educated, seek professional advice, and become self-empowered.


Lessons Learned in 2011 – A Year in the Life of a Real Estate Investor

With experience comes strength, and with strength comes true freedom.
With experience comes strength, and with strength comes true freedom.


Being an investor takes a certain mindset to see past the learning curve and empower ourselves with the knowledge that will grow into the future we want to create for ourselves. If you want to get good at investing in real estate, you’re going to have to get used to the fact that there will be a few hard lessons along the way. As an experiment, I used a particular hard money lender to fund a rehab project in Bremerton, WA.


This particular deal could have had a better outcome had there been more favorable financing in place. However, using hard money for this particular rehab deal was an experiment. I had been hearing good and bad things about using hard money and decided to try it out on this deal, so with hard money I purchased a single-family property from HUD.


Since I was buying the house as-is, I thought I might save some money on the home inspection by not ordering one since I purchased the house at .50 on the dollar. However, It was a mistake. Even at .50 on the dollar, I still paid too much. Had I seen an inspection during the inspection period, I would have adjusted my offer to include the cost of waterproofing the basement, installing a french drain, and repairing the deck and garage. Seller would have balked, and Buyer would have walked.


Old Wisdom says that experience teaches best, and what doesn’t kill you makes you stronger. I can agree with this wholeheartedly, because I learned two things from this deal:


1. ALWAYS get an inspection – even if you think you’re getting a steal of a deal, ALL repairs must be accounted for before the inspection period expires


2. NEVER use 150-day hard money financing for rehab deals.


By the way, here is a virtual tour of the property I rehabbed:



Merry Christmas, Happy Holidays, and a Happy New Year to all!




When the Going Gets Tough: Mindset and the Journey to Sustainable Wealth through Real Estate


There is an old saying, “When the going gets tough, the tough get going.” These words could not be truer in the fight towards achieving a financially sustainable life. For those well-connected people born into the wealthiest 1%, it is a lot easier to achieve and maintain financial independence. However, for the rest of us, we may have a few barriers to overcome. No matter who we are or where we come from, we all have to start from the very first step. For some, it may mean starting out with no money and some experience with real estate. For others, it may mean starting with no experience and no money. Whatever the case may be, we all have to start somewhere and the sooner we take that first step, the sooner we will become the navigators of our own lives and of our own futures. It often means overcoming what seems to be insurmountable obstacles to achieving the dream of financial sustainability.

The number one barrier for many of us is having a fearful and doubtful state of mind. We second-guess ourselves to death or we allow the negative thoughts, beliefs, and opinions of others to condemn us to a life of mediocrity. As a result, we end up making poor choices that lead us off-course only to find ourselves in situations that only work against us by reinforcing the doubt and fear we already have about ourselves and our capabilities to create the life we want for ourselves and for our families.

To make matters worse, there are a myriad of real estate gurus out there that promise the moon and the stars in order to extract the next dollar, but who fall short in one way or another, and never deliver on their promises. Once again, this reinforces the fear and doubtfulness of ever becoming financially independent. It feels like an “Impossible Dream.” This–in turn–causes hopelessness, depression, and a diminished sense of self-worth.–all because we are unable to see through to the truth.

One of the greatest thinkers of the 20th century–Napoleon Hill–summed up the truth in just a few words, “In every adversity, there is the seed of an equal or greater benefit.” When it comes to financial sustainability, one must face the unknown and tackle the obstacles that appear along the way. We must persevere through the discomfort that often comes with stepping outside of our comfort zones in order to learn the things that will lead to the financial freedom so highly desired by many–but only achieved by few. No matter the obstacle, there is a solution–and no matter the solution, there is a learning curve. Take heart. Get educated and don’t take that learning curve on alone. Find the people and professionals who CLEARLY have a vested interest in your success and stay away from those merely interested in extracting your hard-earned dollars without supporting your path to success every step of the way.


On Mindset and Turning Things Around – Reflecting on Steve Jobs’ 2005 Commencement Speech at Stanford University



Turning things around
Reflecting on truth


Focus has been an important lesson for me these past 12 months. It has meant re-setting priorities and making tough decisions along the way. One–of which–was to set school aside to focus on getting my business through rough economic waters.  For many years, I was able to balance school, work, and life; but when the economy took a turn for the worse and as my studies grew markedly intense, I knew that I had to make a choice–although, it was not an easy one for me to make. When we are feeling down, it is easy to get lost in the waves of emotion that often go with life’s’ disappointments. However…

I found a video that really put it all into perspective for me. It was a video of Steve Jobs giving a commencement speech at Stanford University. It reminded me that working towards a vision in life is worth fighting for. It means staying strong when the going gets tough, and not letting the years escape when there is so much to carry out to bring things back into balance.  The most striking thing I heard him say was when he spoke about a calligraphy class that inspired greater things to come and ultimately brought our world to a new level of connectivity and communication. It shows how seemingly small inconsequential things can become the seeds of change for the future:

“Of course it was impossible to connect the dots looking forward when I was in college. But it was very, very clear looking backwards ten years later. Again, you can’t connect the dots looking forward; you can only connect them looking backwards. So you have to trust that the dots will somehow connect in your future. You have to trust in something, your gut, destiny, life, karma, whatever. Believing that the dots will connect down the road will give you the confidence to follow your heart; even when it leads you off the well-worn path, and that will make all the difference.” (Jobs, 2005)

In order to change the future, we must start with our vision of life and then trace back to the first step that begins today. There will never be a way to predict an outcome. We can “what if” ourselves to death, but when it comes right down to it, there is no room for fear and doubt. There is no instant gratification when it comes making a positive difference in changing the context of our lives for the better. When the winds of change begin to call us, we can either answer it by recognizing that something is not right– and then do something about it–or we can take the path of least resistance accepting things as fate and settling into a life of mediocrity and unfulfilled aspiration. We can choose to live our lives as others would prescribe to us, or we can choose to find our own way. We can choose to pursue and live an extraordinary life, or we can procrastinate and fall asleep at the wheel letting the years escape us while rendering us lost ships in a world of uncertainty. It is totally up to us. We all have a choice, and no one can make this choice for us.

This is especially true for families who have struggled financially to make life a better place for themselves and for their future generations. It only takes one person to break the vicious cycle of generational poverty in their family line. It only takes one person to set an example for others to follow—proving that change can happen for the better. I believe Steve Jobs was such an example that we may learn from,

“Your time is limited, so don’t waste it living someone else’s life. Don’t be trapped by dogma — which is living with the results of other people’s thinking. Don’t let the noise of others’ opinions drown out your own inner voice. And most important, have the courage to follow your heart and intuition. They somehow already know what you truly want to become. Everything else is secondary.” (Jobs, 2005)


It all takes determination, perseverance, focus, and a deep sense of living a purposeful life.  It means acknowledging what we must do, and then making the necessary decisions to make them happen and to make life better. It may mean that we lose some friends in the midst of transition, but at the same time, it may also mean that we discover who our real friends truly are— a treasure trove in itself.

Dare to dream. If we dare to follow the heart that lives within us all, then it will serve as our beacon of light to a better way of life. Anything is possible as long as we believe it is so.


We can choose how to live our lives--for better, or for worse.