New year, new start - Here’s a recap of a proven roadmap for successful real estate investing

Jan 9

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The start of a year is a great time to plan your 2025 goals. Whether you are just starting out, or are planning to add properties to your portfolio, I believe there is value in reviewing this step-by-step process that we’ve followed to consistently deliver high-performance properties.

In this blog, I will walk through each step. If you have questions, please reach out (by replying to this email).

Goals

“If you don’t know where you are going, you might wind up someplace else.” …Yogi Berra

Setting written goals is the foundation of any successful venture. Writing them down turns your ideas into tangible objectives you can work toward. Your goals don’t need to be overly complicated. Start with these three key points:

Current Situation

Assess your current or expected capital and credit within a realistic timeframe. If you’re not paying cash for properties, get pre-approved for an investor loan to understand your available credit.
Time Frame

The shorter your timeline to achieve your goal, the more upfront capital and credit you’ll need.
End Goal

Most investing goals focus on replacing their current income, like $5,000/Mo. However, financial freedom isn’t a one-time event; it’s about sustaining your desired lifestyle for the rest of your life.

Once you clarify your goals, the next decision is where to invest.

Investment Market/City

Location is the most important investment decision—the investment city determines rent growth rate, appreciation, and income longevity.

What determines rent growth?

Property prices determine rental rates, which are determined by population change. Here’s how it works:

Population Decline or Stagnation: If the population is static or shrinking, the current housing supply meets demand, and property prices decline (in inflation-adjusted dollars). Low prices enable more people to buy, limiting demand for rental properties so rents decline (in inflation-adjusted dollars).
Population Growth: In areas with growing populations, demand outpaces supply, driving up property prices. Higher property prices mean fewer people can afford to buy, so more people rent. This added demand for rentals drives up rents.

You must invest in a city with significant and sustained population growth to achieve rent growth that outpaces inflation. Without population growth, your rental income will lag behind inflation, requiring you to find additional sources of income.

How long your rental income lasts depends on the job growth in the investment city.

Private-sector jobs are temporary by nature. Most companies survive only ten years, with even large corporations lasting around 18 years. This means your tenants will eventually need to find new jobs. If a city lacks new companies creating similar-paying positions, workers often must accept lower-paying service jobs. This leads to declining rents when adjusted for inflation. Your long-term financial success, therefore, depends on new companies steadily moving into the city to create replacement jobs. Las Vegas exemplifies this dynamic, with new businesses continually establishing operations, replacing existing companies, and driving consistent job growth.

Companies have many options when selecting a location to set up operations. While different industries may have additional location requirements, there are four basic requirements.

Low crime: Companies are unlikely to establish new operations in high-crime cities. Never invest in any city on this list of the 50 most dangerous US cities.
Low operating costs: High operating costs are one of the driving factors for many companies, leaving states with high taxes, regulations, and other costs. Why would companies set up new operations in a city with high operating costs?
Sufficient infrastructure: Companies select locations with major airports, highways, and a large population of potential workers. These are primarily found in cities with a metro population >1M.
Pro-business environment: Many cities treat employers as adversaries through restrictive policies. Rent control measures, burdensome employment regulations, and excessive administrative requirements exemplify this. Companies know where they will be treated well and where they are not wanted. “Money goes where money is treated best.”

Your future ability to attain and maintain financial freedom depends on the city where you invest.

For more on how to select a great investment city, see -

Investment Team

An essential location selection criterion is an experienced local investment team. While podcasts, books, seminars, and websites offer general knowledge, you'll buy a specific property in a specific location, subject to local rules and regulations. Only an investment team can provide the crucial local knowledge you need.

Moreover, you'll need various resources to find, validate, inspect, renovate, and manage a property. You have two options: attempt to gather these resources or collaborate with an existing team. Consider a different investment location if you can't find an experienced team with all the necessary resources.

To build a local investment team, start with an experienced investment realtor. I will explain how in next week’s blog post.

Tenant Segment

No property ever paid rent. The tenant who occupies the property pays the rent. And you need your property occupied by a reliable tenant. A reliable tenant stays for many years, pays the rent on schedule, and takes good care of the property.

Reliable tenants are the exception, not the norm. Every tenant segment has some reliable tenants. However, there will be a segment with a high percentage of reliable people. By interviewing your investment team, you can identify this segment and the properties they are currently renting.

For more, see -

Buy Properties

Once you identify the tenant segment you want to occupy your property and what they currently rent, all you have to do is buy similar properties. This is the same process a retail store uses to determine what to stock. For example, in Hawaii, McDonald's sells poi and spam. In France, they sell wine.

They identified their customers (in your case, reliable tenants) and provided what they wanted to buy (rent).

Summary

As the saying goes: "Yard by yard, life is hard. Inch by inch, life's a cinch."

Follow this proven, step-by-step process to maximize your chances of success and minimize risk in real estate investing.

Has this process proven successful? Absolutely. We've successfully delivered over 550 investment properties to over 180 clients worldwide following this process, and:

Over 90% of clients have invested with us repeatedly, showing they are happy with their investments.
Our average tenant stays over five years.
2008 crash - Zero decline in rent and zero vacancies.
COVID - Almost no impact
Eviction moratorium - Almost no impact
From 2013 through 2023, the annual appreciation and rent growth rates were over 10% and 8%, respectively.

If you're interested in exploring how the current Las Vegas market conditions could align with your goals, please use the link below to schedule a time that works best for you.