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Answers - Using Your Property as a Wealth Creation Machine
Used properly, your property and your mortgage can be used to create long
term wealth and financial security.
Over the years, we have found a a proven formula for using property to help create wealth.
Please take the time to read this entire article, as we will explain our core values and concepts. At the end of the article, you will find an actual case study.
With this information, you should be able to “put the pieces together” to find you the best possible plan for you to create wealth in Real Estate.
Over the years, we have found a a proven formula for using property to help create wealth.
Please take the time to read this entire article, as we will explain our core values and concepts. At the end of the article, you will find an actual case study.
With this information, you should be able to “put the pieces together” to find you the best possible plan for you to create wealth in Real Estate.
According to USFDA, a combination product is one composed of any combination of a drug and device; biological product and device; drug and biological product
Our 4 pillars of Real Estate Investment provide a foundation to start
creating wealth in Real Estate. These four key concepts, combined with
training and support from a few key professionals will enable you to do two
things.
First, you will be able to take care of any immediate negative financial situations you may be facing.
Secondly, you will be able to start creating wealth and financial security at the same time.
The 4 Pillars of Real Estate Investment
1. Have a plan.
2. 5% AEA.
3. Cash F
First, you will be able to take care of any immediate negative financial situations you may be facing.
Secondly, you will be able to start creating wealth and financial security at the same time.
The 4 Pillars of Real Estate Investment
1. Have a plan.
2. 5% AEA.
3. Cash F
; or drug, device, and biological product and fixed dose combination would include two or more combinations of drug.
Examples of combination products may in
Examples of combination products may in
ow is King!
4. Never Sell a Property…unless you have to.
Let’s take a few minutes and discuss each of these Pillars:
1. Have a plan.
We can not stress enough how important it is to have a long term plan. Taking the time to work out a strategy and a plan for wealth creation with a professional could be the best time ever spent.
Take a look at where you are now financially, and where you would like to be when you retire. Perhaps you would like to have your house paid off. Maybe you would like to own som
4. Never Sell a Property…unless you have to.
Let’s take a few minutes and discuss each of these Pillars:
1. Have a plan.
We can not stress enough how important it is to have a long term plan. Taking the time to work out a strategy and a plan for wealth creation with a professional could be the best time ever spent.
Take a look at where you are now financially, and where you would like to be when you retire. Perhaps you would like to have your house paid off. Maybe you would like to own som
lude drug-coated devices, drugs packaged with delivery devices in medical kits, and drugs and devices packaged separately but intended to be used together.
cash-flow-positive investment
property.
If you are like most Californians, you are likely to refinance, or move every 2-7 years. Without a strategic plan for investing, this can be extremely costly as well as undermining your long-term profitability.
Let’s start treating our house like a business, and learn how to create the maximum amount of profit out of it. Take a few minutes to talk about your plan with a pro.
2. 5% Annual Equity Appreciation
The 2nd pillar of Real Estate Investing is 5% A-E-A. For t
If you are like most Californians, you are likely to refinance, or move every 2-7 years. Without a strategic plan for investing, this can be extremely costly as well as undermining your long-term profitability.
Let’s start treating our house like a business, and learn how to create the maximum amount of profit out of it. Take a few minutes to talk about your plan with a pro.
2. 5% Annual Equity Appreciation
The 2nd pillar of Real Estate Investing is 5% A-E-A. For t
here is enormous increase in the number of combination products entering the market in the recent years. Combination products have proven advantages but fixe
e last 40 years,
property values in California have risen about 5% per year (or more). This
percentage will generally compound each year by this amount.
At the time this was written, April 2007 we are currently seeing somewhat of a “slowdown” in the market, but consider property values have always been cyclical. If we look back over the last 40 years or so, we can plainly infer that property values have continued to increase substantially over all.
For example:
If you had purchased a 3 bedroom, 2.5 bath, t
At the time this was written, April 2007 we are currently seeing somewhat of a “slowdown” in the market, but consider property values have always been cyclical. If we look back over the last 40 years or so, we can plainly infer that property values have continued to increase substantially over all.
For example:
If you had purchased a 3 bedroom, 2.5 bath, t
d dose combinations are still in the process of convincing regulatory authority on their advantages over the single ingredient formulations.
Combination pro
Combination pro
ypical suburban property 7
years ago in San Diego County, you would have paid approximately
$250,000.
Today’s market value for that same piece of property would be approximately $450,000-$500,000. This is an increase of well over 5% per year compounded.
Here is another example:
A family member purchased a property in Los Gatos, California in 1966. The cost for the property at the time was $30,000. The payment on that property was $438.00 (wouldn't that be nice today??)
40 years have passed, and recently
Today’s market value for that same piece of property would be approximately $450,000-$500,000. This is an increase of well over 5% per year compounded.
Here is another example:
A family member purchased a property in Los Gatos, California in 1966. The cost for the property at the time was $30,000. The payment on that property was $438.00 (wouldn't that be nice today??)
40 years have passed, and recently
ucts have become life saving products for the pharmaceutical companies who doesn’t have many innovative molecules in their product pipeline and have been inc
hat same piece
of property sold for almost $1.2 million. If you look at the compounding
factor, that property increased in value (over the long term) well more than
5% per year.
5% Annual Equity (over the long term) is a fact, even with current market fluctuations, and current conditions.
3. Cash Flow is King!!
This is probably the most misunderstood aspect of Real Estate investing. There are several different aspects to Cash Flow. Cash Flow comes from many different sources. Working with a prof, they can
5% Annual Equity (over the long term) is a fact, even with current market fluctuations, and current conditions.
3. Cash Flow is King!!
This is probably the most misunderstood aspect of Real Estate investing. There are several different aspects to Cash Flow. Cash Flow comes from many different sources. Working with a prof, they can
easingly used in the product life cycle management. Even the companies having product patents are trying to extend their product life cycle through the combi
help you identify all
the possibilities from where you can generate additional cash flow.
Here is a short list of often overlooked sources of Cash Flow to fund your
Real Estate investing, and help you to start creating wealth through Real
Estate investment.
1.Income from your jobs
2.Overpaid taxes that could be accessed with good planning
3.Cash back at closing when purchasing property
4.Savings from debt consolidation
5.Lump sum Cash from Refinancing
6.Arbitrage investing
7.Rent
1.Income from your jobs
2.Overpaid taxes that could be accessed with good planning
3.Cash back at closing when purchasing property
4.Savings from debt consolidation
5.Lump sum Cash from Refinancing
6.Arbitrage investing
7.Rent
nation products and maximize the revenues. But the companies involved in this practice are overlooking that they are burdening the patients both economically
and depreciation from Rental Property
Understanding “the big picture” Cash Flow is vital to your financial security.
Here is another widely misunderstood concept about Cash Flow:
ACTUAL COST
Actual cost is the true cost of what it takes to purchase something.
Strange as it sounds, when we look at the Actual Cost of something, we look at what we have to take out of our pocket on a monthly basis to pay for it.
In other words, something only costs you what you have to pay for it on a monthly basis. This is ho
Understanding “the big picture” Cash Flow is vital to your financial security.
Here is another widely misunderstood concept about Cash Flow:
ACTUAL COST
Actual cost is the true cost of what it takes to purchase something.
Strange as it sounds, when we look at the Actual Cost of something, we look at what we have to take out of our pocket on a monthly basis to pay for it.
In other words, something only costs you what you have to pay for it on a monthly basis. This is ho
and physically. They need to rightly judge the benefits of the combination products and they have to even look at the risks involved when combining the produ
w companies are able to afford costly equipment.
And this is how most Americans pay for their cars, houses, and credit card
bills.
This is also why in some cases interest rate may not be as important as most people realize.
Here is a hypothetical situation for you to consider:
Imagine someone was going to loan you $1,000,000 cash. When you died, the loan was forgiven and you only had to pay $100.00 per month for your payments on that loan. The only problem is that the interest rate is 25%. However, you do
This is also why in some cases interest rate may not be as important as most people realize.
Here is a hypothetical situation for you to consider:
Imagine someone was going to loan you $1,000,000 cash. When you died, the loan was forgiven and you only had to pay $100.00 per month for your payments on that loan. The only problem is that the interest rate is 25%. However, you do
ts. Some of the combination products were well accepted by physicians while others suffered. Companies involved in development of combination products are fi
’t pay an interest rate every month, you pay a payment.
Often times we get so caught up in the interest rate on a mortgage loan that we do not even consider the long term ramifications of what the “payment” would allow us to do. With a smaller payment of only $100.00 per month, we could use the $1,000,000 to earn us much more than the payment that we are paying.
This in turn makes the interest rate and even the payment not so important, right?
Something only costs you what you pay for it on a monthly basis
Often times we get so caught up in the interest rate on a mortgage loan that we do not even consider the long term ramifications of what the “payment” would allow us to do. With a smaller payment of only $100.00 per month, we could use the $1,000,000 to earn us much more than the payment that we are paying.
This in turn makes the interest rate and even the payment not so important, right?
Something only costs you what you pay for it on a monthly basis
ding difficulty in defining their combination products and facing various challenges from selecting a combination to marketing it.
Following aspects would a
Following aspects would a
This is the
foundational concept of CASH FLOW IS KING.
4. Never Sell… Unless you have to.
I am aware of several situations where the property actually made more money than the occupants did at their jobs. This was especially true during the boom years from about 1999-2003.
There are several reasons you want to avoid selling a piece of property.
1.You create a taxable event.
2.You may have to pay commissions to buyers and sellers Agents (Realtors).
3.Your property rarely sells for the Appraised Value.(Usu
4. Never Sell… Unless you have to.
I am aware of several situations where the property actually made more money than the occupants did at their jobs. This was especially true during the boom years from about 1999-2003.
There are several reasons you want to avoid selling a piece of property.
1.You create a taxable event.
2.You may have to pay commissions to buyers and sellers Agents (Realtors).
3.Your property rarely sells for the Appraised Value.(Usu
dd to the challenges in developing combination products:
Which markets to tap where the combination products can do fairly well?
Which combination prod
Which markets to tap where the combination products can do fairly well?
Which combination prod
lly less)
4.You may have to pay recovered depreciation.
5.You are selling an appreciating asset.
Recovery of Depreciation.
When you sell a piece of property that you previously claimed depreciation on, you will be required to pay a tax on that. Capital Gains Tax. Depending on your situation, you may have to pay a Capital Gains Tax on your proceeds.
Many times to get your property sold, you may have to list it with a Real Estate agent. This can cost as much as 4-6% of the sale price.
A property may not se
4.You may have to pay recovered depreciation.
5.You are selling an appreciating asset.
Recovery of Depreciation.
When you sell a piece of property that you previously claimed depreciation on, you will be required to pay a tax on that. Capital Gains Tax. Depending on your situation, you may have to pay a Capital Gains Tax on your proceeds.
Many times to get your property sold, you may have to list it with a Real Estate agent. This can cost as much as 4-6% of the sale price.
A property may not se
cts are meaningful and rational?
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin
ll for its appraised price. During the buying/selling
process, people will generally negotiate down from their original list price.
This could be due to several factors such as finding a qualified buyer who is ready to purchase, or a buyer willing to work with the seller’s timetables.
Typically, this further reduces that profitability of a piece of property because it is being sold for less than what it actually may be worth.
Worst of all, as already illustrated, selling an appreciating asset is not general
This could be due to several factors such as finding a qualified buyer who is ready to purchase, or a buyer willing to work with the seller’s timetables.
Typically, this further reduces that profitability of a piece of property because it is being sold for less than what it actually may be worth.
Worst of all, as already illustrated, selling an appreciating asset is not general
tions increase the patient compliance?
What would be the developing cost?
How to tackle the risks encountered during combination product developmen
What would be the developing cost?
How to tackle the risks encountered during combination product developmen
y in your best interest, especially if it is not necessary.
There are always times when people must sell. This is normally a result of Cash Flow problem, where the payment simply cannot be met any longer.
Case Study
Here is a case study of an actual active client that we are currently helping
C. N. is about 3 years from retirement after working the same position for nearly 25 years, and living in the same house for 23 years.
She has considerable assets set aside in her retirement program. She had wanted to
There are always times when people must sell. This is normally a result of Cash Flow problem, where the payment simply cannot be met any longer.
Case Study
Here is a case study of an actual active client that we are currently helping
C. N. is about 3 years from retirement after working the same position for nearly 25 years, and living in the same house for 23 years.
She has considerable assets set aside in her retirement program. She had wanted to
t?
As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel
As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel
get out of her current house because it was too big and getting to be too
much trouble to take care of.
She found another house for sale across town that was about the same price, but was smaller, easier for her to care for, but in a much nicer neighborhood.
She came to us to list her existing home, so she could purchase the smaller, nicer home.
We consulted with her and suggested an idea which ultimately gave her a better end result; keeping both houses, thereby doubling her potential Annual Effective Appr
She found another house for sale across town that was about the same price, but was smaller, easier for her to care for, but in a much nicer neighborhood.
She came to us to list her existing home, so she could purchase the smaller, nicer home.
We consulted with her and suggested an idea which ultimately gave her a better end result; keeping both houses, thereby doubling her potential Annual Effective Appr
ping new procedures for reviewing their safety, efficacy and quality.
Professional from academic institutions, pharmaceutical industries, health care indust
Professional from academic institutions, pharmaceutical industries, health care indust
ciation.
After careful consultation with a professional, this is how what C. N. decided to do looked on paper.
House #1 House #2
Value 525,000 Value 500,000
Owed 97,000 Down Payment 200,000
Old Payment 937 New Loan 300,000
New Loan 300,000 New Payment 1,000
New Payment 1,000 Rent 1,800
Her decision was to refinance her current home, fix it up and rent it out. By including extra cas
After careful consultation with a professional, this is how what C. N. decided to do looked on paper.
House #1 House #2
Value 525,000 Value 500,000
Owed 97,000 Down Payment 200,000
Old Payment 937 New Loan 300,000
New Loan 300,000 New Payment 1,000
New Payment 1,000 Rent 1,800
Her decision was to refinance her current home, fix it up and rent it out. By including extra cas
y and representatives from various regulatory agencies are working out to design the regulatory requirements for manufacture and sale of combination products
h-out in the refinance of House #1, she was able to
purchase the nicer home she wanted.
Now C. N. controls both pieces of property. If you look at what she was paying before (Cash Flow) she was paying about $937.00 per month for one house.
When C. N. only owned one piece of property, she was paying $937.00 per month for her house.
Now she is paying $200.00 for 2 pieces of property. She has the rent coming in of $1,800.00 per month, and 2 payments of approximately $1000.00 each.
Plus she was able to care fo
Now C. N. controls both pieces of property. If you look at what she was paying before (Cash Flow) she was paying about $937.00 per month for one house.
When C. N. only owned one piece of property, she was paying $937.00 per month for her house.
Now she is paying $200.00 for 2 pieces of property. She has the rent coming in of $1,800.00 per month, and 2 payments of approximately $1000.00 each.
Plus she was able to care fo
.
As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de
As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de
some deferred maintenance in House #1.
She is actually saving about $700.00 per month over what she was paying prior to purchasing the other piece of property. This is a classic case study of CASH FLOW.
Now she has over $1,000,000 worth of property.
Applying Rule #2 (5% AEA), she will now earn $50,000 per year worth of appreciation on both properties, instead of $25,000 on her one house.
Even if the market drops slightly during that time, she would still has about $400,000 worth of equity in the two prope
She is actually saving about $700.00 per month over what she was paying prior to purchasing the other piece of property. This is a classic case study of CASH FLOW.
Now she has over $1,000,000 worth of property.
Applying Rule #2 (5% AEA), she will now earn $50,000 per year worth of appreciation on both properties, instead of $25,000 on her one house.
Even if the market drops slightly during that time, she would still has about $400,000 worth of equity in the two prope
elopment. They need to be wiser in analyzing the market trends and the regulatory requirements.
Companies that provide selfless information through particip
Companies that provide selfless information through particip
ties.
In addition she saves $700.00 per month (not to mention the tax benefits of owning two properties). If she were to keep this situation for about 3 years her NET Saved is approx. $30,000. Assuming she put that into a retirement plan earning 8% how much would that be worth? You do the math...
“Having a plan” and understanding “The 4 Pillars of Real Estate Investment” will make a true difference in your financial life.
As always, we would love to hear your comments, questions, and concerns of this articl
In addition she saves $700.00 per month (not to mention the tax benefits of owning two properties). If she were to keep this situation for about 3 years her NET Saved is approx. $30,000. Assuming she put that into a retirement plan earning 8% how much would that be worth? You do the math...
“Having a plan” and understanding “The 4 Pillars of Real Estate Investment” will make a true difference in your financial life.
As always, we would love to hear your comments, questions, and concerns of this articl
tion in industry events and feedback to regulatory authorities would be able to face the challenges and will be successful in developing combination products
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