Linda McKissack and her husband were $600,000 in debt when they made a real estate decision that turned their lives around. Today, the McKissack Realty Group sells over $60 million and over 300 properties each year. McKissack says their biggest success is not their property sales; it’s how they learned to generate over $250,000 a year in passive income and achieve financial freedom through real estate.
Linda McKissack is an entrepreneur, REALTOR®, and the author of “HOLD: How to Find, Buy and Rent Houses for Wealth.” She’s also a trainer and speaker whose greatest passion is helping others achieve their maximum potential. She’s created five successful businesses and is an owner/investor in numerous residential and commercial properties.
Her message to agents everywhere: “You don’t have to live paycheck to paycheck. Learn how to obtain financial freedom through real estate.”
Using lessons from her book, McKissack explains how to start investing and earning money even when you have no money.
“If you don’t design your life, something or someone else will,” McKissack said. “Keep this question in front of you: ‘What would happen if today the financial resources of your business totally disappeared?’ It happened to us; it happened to people in Houston, in Florida, in Puerto Rico with the hurricanes. What are you going to do when it happens to you?”
Drowning in Debt
“I was 23 years old and I didn’t know what the word ‘economy’ meant,” McKissack said. “In the ’80s the economy was built around savings and loans, oil and gas and real estate, and it all crashed.”
McKissack’s husband shut down his Dallas nightclub, and four years later they were $600,000 in debt. He asked for her help digging out of debt, and said his mentor once told him the way to make a lot of money fast was in real estate.
“I’m sure he meant invest in real estate, buy real estate,” McKissack said, “not put your wife to work selling real estate, but sell is what I did.” McKissack took a job in real estate sales, and Jim went to work in her office. They restructured their debt with a simple goal: getting back into the black.
It was a good decision, but it took time to see the wisdom in it. “I made $3,000 that first year, but it cost me $15,000 to $17,000 to make that first $3,000. Fast forward to today and our team closes over 200 transactions a year and $60 million in volume. Today we run as a standalone business.”
McKissack’s first real estate investment came in 1991. They had no cash, a lot of debt to pay off and weak credit, and the only real estate they owned was the house they lived in, which had a big mortgage.
“We found a property the seller wanted to sell fast, without listing it. They asked if we knew of an investor who would purchase the home. We knew it was a good deal, even though the house needed repairs. We formed a partnership with our builder who put up money and got a loan. We located the property and put our commission into the deal. He did the repairs. We flipped the property for $15,000 profit and we were off to success.”
What investing taught McKissack was how to beat the REALTOR® dilemma. “The REALTOR® dilemma is the day you sell your last house is the day you make your last dollar. I used to think if I just sold 50 more houses, those 50 houses would solve all my problems. We keep thinking 50 or 100 or 200 houses are going to solve all our cash problems, but it’s not. Cash flow is not the answer. If you follow the statistics, if we don’t do anything different; most of us will die broke or dependent on the government, family, or friends.”
Not wanting to rely on others for their financial security is what started the couple down the road to financial freedom with HOLD.
Creating Financial Freedom With HOLD
“HOLD is a long-term real estate investment strategy to which every real estate investor should aspire,” said McKissack. “Be an investor, not a speculator. We bought our first property while we were still $600,000 in debt. We now own over 100 single family properties. There are a lot of people who have money they want to invest, but they don’t have the expertise to do it.”
Going 50/50 is a definite option, especially using the HOLD strategy. The HOLD strategy is simple:
If you’re actually flipping houses (buy and sell), you’re just creating more cash flow. What you need is an investment. Our HOLD formula for wealth-building:
7 Rules of HOLD Real Estate Investing
By purchasing 20 single family rental properties that each generated $1,000 cash flow per month, and completing those purchases in five years, with each property financed on a 15-year note with at least 20 percent down payment, the McKissacks were able to keep investing in additional properties.
The HOLD strategy isn’t a get-rich-quick scheme, but a long, slow process that involves learning how to build and sustain a strong team and how to run your real estate career as a business, not a job. These and more tips and information on building passive income are in a recent webinar featuring McKissack. Learn more about the team-building cycle, including how to hire great people who can take you greater financial and business success, by listening to the entire webinar.
For more information, please visit connect.homes.com.
Homeownership is the epitome of the American Dream not only for its advantages as a financial asset, but also for its sociocultural value—in fact, most renters associate owning a home with the ultimate ideal, despite having some difficulty affording it.
A recent report by cost information website HowMuch.net reveals the goal is within reach—for some—and most are set on realizing it regardless of cost.
In a side-by-side analysis of monthly housing costs, the slimmest gaps between owning and renting are shown to be in the Rust Belt and the Southeast. Homeownership in West Virginia is the most easily achievable, requiring only $297 above and beyond the cost of renting. A home in Indiana, Arkansas, Florida and South Carolina is also relatively attainable.
Credit: “Buying vs. Renting a Home by State” by HowMuch.net
Many states favor renters expense-wise—the Garden State having the starkest contrast between renting and owning—but the intangible implications of homeownership, such as privacy and security, are outweighing cost barriers. The report cites recent Census data showing that although the homeownership rate is idling, owner household formation is occurring faster than renter household formation.
Still, the monthly cost of owning is, for many would-be homeowners, a non-issue. The report concludes:
That ideal vision of “home” is strong enough to convince over half of all Americans to stretch their budgets in search of the yard with white picket fences. In all, no amount of data can overcome the perfect image of the ideal home.
Dog owners are infamous for providing their furry ones with a better lifestyle than their own. For instance, you might recall the time Paris Hilton had a replica of her mansion done for her pet Chihuahua.
We don’t need to go there, but there are definitely plenty of crazy options in the market. Who knows, one of them might catch your fancy.
Is your dog named Quixote? Donatello? If not, you might as well rename them, especially if that means they get to live in this woof-tastic villa. Look at that wooden double door! Seriously, if you can’t win your dog’s affection with this one, then just stop trying.
The Full-Fledged Mansion
If you’re going to go all out, you might as well just get your dog a straight-up mansion. If you already own a mansion (like Paris), I’d say it’s only fair you share the wealth. (Although your dog probably has its own room in the house. But why not both? #Excess.)
The Victorian Home
I’m a big fan of Victorian homes, so I’d probably go for this one… for myself? How is that a dog house? I only wish my downtown New Haven apartment looked as picturesque as this puppy’s home. I hope his name is Darcy and that he wants to be my friend.
The Dog-equivalent of the “Home Alone” Mansion
I’d say this is pretty close to the McCallister home, right? (As far as dog houses go, at least.) I can totally imagine dogs holding town meetings inside this bad boy. If I were a dog myself, I’d probably prefer sleeping in here than inside my owner’s run-down home. Because let’s face it, the dog who owns this home is definitely much better off than his owner.
And this was just a quick search! There are legitimate houses for dogs out there. As in, a concrete building with rooms where only your dog(s) reside(s). I know there’s always stuff to fix around the house, but surely your four-legged friend takes priority?
Have some cool dog houses you want to share with us? Tweet them to @HousecallBlog!
As a reminder, PSE is currently offering the following rebates:
$25 Rebates on Energy Star® Certified Freezers
$75 Rebates on Energy Star® Certified Refrigerators and Clothes Washers
$75 Rebates on Smart Thermostats
$150 Rebates on Heat Pump Dryers
$500 Rebates on Energy Star® Certified Gas Dryers
$500 Rebates on Electric Vehicle Chargers
Visit PSE.com/Rebates to learn more information about these PSE Energy Efficiency programs.
The only way you can be sure that you are digging safely is to Call 811 Before You Dig, and request a FREE underground utility locate.
At least two business days before you plan on digging:
Be sure to provide the following information:
Affected local utility companies will be notified about your intent to dig. They will send a locator to mark the approximate location of your underground utilities, following the color codes to the right, so you’ll know what’s below – and be able to dig safely.
Digging anywhere in the state of Washington without calling for a utility locate is against state law. Failure to call may result in fines, charges for damages, and criminal convictions.
For more information, visit www.call811.com.
When digging within two feet of the marked area, only use small hand tools such as a garden trowel to carefully expose the utility line. Keep in mind that utility installation is not the same for all utilities and requirements have changed through the years. Not all utilities are installed with protective casings and can be vulnerable to damage by tools as simple as a shovel. Always proceed with caution when digging around utility lines.
If a locate was late, inaccurate, or incomplete – report it to the UTC. Call 1-888-333-WUTC (9882) or email firstname.lastname@example.org. You can also file a complaint with the Washington Dig Law Safety Committee.
With the many different projects reported annually in Remodeling Magazine’s Cost vs. Value Report, not much has changed from last year…and that’s not a bad thing. The 29 projects found on this year’s report paid back an average of 64.3 cents on the dollar in resale value. Looking at the 24 most tracked projects (projects consistently tracked for the last six years), their payback for 2017 was also 64.3 cents—only three-quarters of a penny higher than 2016 projections.
Why the little change? Simply put: the differences in underlying numbers was minimal year-to-year. The average cost for those 24 projects rose a meager 3 percent, while the value that real estate professionals put on said projects only rose 4.2 percent. Minor gains, yes, but we’ll take what we can get.
Recent and long-time trends continued, reports Remodeling. Curb appeal projects like changes to doors, windows and siding garnered a higher ROI than work done inside the home. Replacement projects, like doors or windows, scored higher among real estate pros than did remodels.
On a national scale, the top five projects with the greatest ROI in the report’s “midrange” cost category are:
The top five projects with the greatest ROI in the report’s “upscale” cost category are:
Regionally, the Pacific division (California, Oregon, Washington, Alaska and Hawaii) saw an average payback of 78.2 percent for all projects, with 10 projects posting cost-recouped levels of at least 90 percent. The East North Central states of Ohio, Indiana, Michigan, Illinois and Wisconsin, however, saw an average of just 54.9 percent, with no single project offering a payback of as much as 80 cents on the dollar.
At the other end of the spectrum are projects with the lowest returns on investment—improvements generally not in demand by the market. Again on a national scale, the five projects with the lowest ROI in the “midrange” cost category are:
The five projects with the lowest ROI in the “upscale” cost category are:
The 2017 Cost vs. Value Report compares, across 99 markets, the average cost of 29 popular remodeling projects with their average value at resale one year later. Average resale value is calculated based on estimates provided by real estate professionals. View the full report, including project descriptions and city-level data, here.