Good morning,
Diversification seems like a touchy subject for real estate investors. Some of us believe one asset class in one market is sufficient – become the uncontested master of that asset class/market. While others believe that being in a few markets and/or multiple asset classes is a better route. While others view the need to diversify depends on the size of your portfolio – at a certain point it might make sense to expand to other markets.
Unlike most other investment vehicles the correct answer on diversification in real estate is nuanced. This week we will be hearing from an investor who has a diverse portfolio of LTRs and STRs. Proving diversification can work even if you don’t have a portfolio of hundreds of units.
My pleasure to introduce you to Mike Shakar.
How many doors do you have?
As of today we have 7 properties
What got you into real estate investing?
The need to have my Mother in Law to live closer to us.
What market(s) do you operate in?
So. Cal and Palm Springs area
How would you describe your portfolio?
Very well diversified filled with SFH used as Long Term Rentals and Luxury Vacation Rentals
What are you currently buying?
SFH’s in both markets I am already in. Current interest rates are making it very difficult to make them pencil out.
Tell us about your biggest mistake in real estate?
Selling a 4 bedroom student rental in order to get additional cash to flip homes. Should have done a cash out refinance instead. I wasn’t that savvy yet.
Tell us about your biggest win in real estate?
Flipping a condo & investing with a group of friends on a church. Sounds weird but we all doubled our investment in 3 years.
Outside of real estate what else do you invest in?
Max out my 401K with all equities, some hard money lending. Looking at investing in a small business for tax purposes.
Books people should read before investing
Embarrassed to say but have never read a book on investing. Only learned by doing and talking to a lot of people and reading on line articles.
What advice would you give to a new investor?
I like the house hacking approach if it’s your first or buying a duplex/triplex, living in one and renting out the other.
Mike Shakar (@mikeshakar) / Twitter — twitter.com
Check out Mike on Twitter
Checkout the Podcast!
Apple Podcasts — podcasts.apple.com
‎Resilient Real Estate Investing
‎Resilient Real Estate Investing
Google Podcast — podcasts.google.com
‎Resilient Real Estate Investing
Enough Business
Recently I’ve been re-listening to Dan Carlin’s masterpiece on the Mongol Empire. If you’re not familiar with Dan Carlin’s podcast, Hardcore History, you really should.
This 5 part roughly 7 hour series on the Mongol Empire is fascinating. How a group of nomadic tribes ended up building the largest empire known to man. All in just a single generation.
One notable lesson the Mongols learned early on: don’t stay comfortable for too long. These rough and tumble nomads found that they lost their edge after staying too long in the palaces they conquered. They needed to return to their inhospitable roots to sharpen themselves for the next conquest.
This echos what a lot of modern successful people share. That you need to get comfortable being uncomfortable. Being uncomfortable is the wet stone that sharpens your blade. The sharper your blade – the easier you can sleep knowing you can accomplish anything.
See you Tuesday – STR Pro: Automating Messages on Airbnb
