Real estate crash videos: true cost.

The speaker discusses how his friends lost a significant amount of money by listening to real estate crash predictions and avoiding a potentially profitable investment opportunity. The speaker argues that the crash predictions are often based on emotion and not supported by data, and that focusing on finding good deals in the right markets is more important than waiting for a crash.

Real Estate Crash Predictions

• 00:01:30 The speaker recounts how his friends, John and Amber, lost $100,000 by heeding crash predictions and not investing in a duplex. He states that many "crash bros" videos were circulating in 2021, predicting a massive crash due to the end of forbearance, despite lacking real indicators. They believed that prices would drop significantly and they should wait to buy. However, no crash occurred.

Investing Strategy

• 00:03:00 The speaker describes his own successful investment strategy, which involved identifying a good deal in a town with a small population but strong economic drivers. He emphasizes the importance of knowing your market, having boots on the ground, and using conservative numbers to determine returns.

Binder Strategy

• 00:03:46 The speaker outlines his "binder strategy," which involves getting tenants to agree to rent increases by creating a sense of scarcity and demand. This strategy allows him to increase cash flow without having to do extensive renovations.

Friends' Decision

• 00:07:00 The speaker explains how his friends, despite having the funds, chose not to invest in the duplex. They believed the "crash bros" predictions and expected a significant price drop, ultimately missing out on a profitable opportunity.

Market Dynamics

• 00:12:51 The speaker challenges the common perception that high inventory leads to a crash. He argues that it's not inventory but forced sellers that cause a crash. He points out that prices are currently up, despite high inventory, as there is enough demand, and low interest rates continue to drive prices up.

Personal Investment

• 00:26:35 The speaker reveals that he has invested $320,000 from his W2 income and $300,000 from rental income over a decade. He explains that he has been able to invest significantly more in real estate due to house hacking, which reduced his living expenses and allowed him to reinvest more money.

Net Worth Calculation

• 00:27:41 The speaker discusses the misconception of calculating net worth as simply assets minus liabilities. He argues that it's important to account for transaction costs and taxes when determining actual net worth, as selling assets involves those expenses.