How I Turned $1,000 into a Million Dollars in Real Estate ...

is a real estate book that was written by William Nickerson in the 1950's.

It is truly a "how-to" classic with a proven formula that still works today ... but it is no longer in print.

The book by Nicholas Darvas that is titled "How I Made Two Million Dollars in the Stock Market" was also written in the 1950's.

It too is a classic and it *is* still in print today.

Question ...

If you take a poll and ask 100 people what is a better investment ... real estate or the stock market ... I bet the majority would say real estate.

That being the case, why is the Darvas book still available from bookstores and the Nickerson book is not?

Also, if most people think real estate is a safer investment than the stock market, why are 10X more stock market books written each year than real estate books?

This discussion board has a lot of brainy people on it and I would be interested in getting your take on this.

Robert Campbell




Timing the Real Estate Market for optimal profits

Hi,

I'm not sure I qualify as one of the brainy people you mentioned--wait a second, that's wrong, actually I am one of the brainy people you mentioned and it's stupid to act humble, especially about smarts which is a common attribute and one that is not that important any more.

Though I admit to being brainy I'm not sure I can explain what I want to in this message.

Trading is sort of science-like: you study charts, you use mathematics, you collect and evaluate data; trading is sort of beating the market into submission with the power of your brain. I can picture Mr. Spock as a trader--heck, half the time he probably had commodity barcharts displayed in that little box he was always staring into, looking for trends and markets on the move (or it could have been Romulan adult websites).

Real estate, on the other hand, is action oriented rather than intellect oriented. (I can't imagine Mr. Spock driving around looking at properties or doing deals. inspecting walls and checking plumbing; that's the kind of thing Kirk would have been good at. Hey, maybe there's a Kirk/Spock dichotomy between real estate investing and trading.)

That's all I got, and it was probably more than you wanted to hear.

Just my opinion,

- Boyd

dno

> That being the case, why is the Darvas book
> still available from bookstores and the
> Nickerson book is not?
> Also, if most people think real estate is a
> safer investment than the stock market, why
> are 10X more stock market books written each
> year than real estate books?

Simple economics. Think about it:
Most folks can get into the stock market at a pretty reasonable price ($100 or so if you open up a DRIP account). Even full service brokerages will take you with a mere $5k to $10k.

How many real estate properties can you buy for $10k?

How much work does it take to sell your stocks and how quickly do you see the profit? Compare that to selling a piece of land and seeing the profit.

You might have a painting that's worth $1,000 ... but if it's not selling that capital is tied up and isn't really gaining anything. You'd do better to buy 1,000 glowsticks and sell them at a festival for $3.00 each... you'd get an almost instant return and can triple your money in a weekend if you've got the right market.

Hi Mel,

Using your glow stick example for investing in stocks (?), are you therefore trying to say that it's easier to make a $3,000 profit in stocks than in real estate?

Please explain.

Robert Campbell

> Also, if most people think real estate is a
> safer investment than the stock market, why
> are 10X more stock market books written each
> year than real estate books?

Can't comment on the number of books written... only the number of books published.

The publishers will continue to publish what sells the most.

As they are publishing more stock market books, it would appear stock market books outsell real estate books.

WHY?

Because of the media.

When was the last time you heard the mass media mention anything about any kind of instant wealth due to property?

People know property is a buy and hold thing. They want it to be faster and cost less.

Enter the "No Money Down" idea. Enter the "Subject-To" and "Lease Option." Enter "Wholesaling." Satisfies the instant gratification crowd.

Something a lot of the RE sellers mention is their dislike of fixing toilets. And so they hire a property manager.

This has always puzzled me. If your toilet is broken, call a plumber - that's what the property manager does.

Anyway. The difference is: stocks take far less cash, is quicker and easier to get into, involves zero negotiating, and doesn't require any bank red tape.

Property, on the other hand, requires money (if not yours than someone else's), time, bank red tape, title companies and/or settlement people, negotiating, time, money spent on advertising, credit checks, employer checks, did I mention time? Research, education and learning, time, and sometimes real estate agents.

Negotiating. Bank red tape. Real estate agents. SLOW turnaround. Long Time. Money. Everything people hate. That's what real estate investing means.

Go to the discussion boards devoted to each topic - real estate vs stocks. See the million real estate questions... here is a house and they sellers want $350k, it has zero equity, will rent for half the mortgage payment and is about to go into forclosure... how can I buy it? Or, is there a deal here? Or, I have bought it subject-to now what do I do?

Basic hand holding questions. Questions of people looking for an easy way. Questions from people who can't be bothered reading archives or spending a few bucks on a real estate book.

Don't see anyone asking such basic questions on stock market boards? Don't see people saying, "XYZ shares went up 1 cent today after falling $25 over the last two months, should I buy them now?" (At least not on the stock boards I go to.)

It's the same reason why in stock market investing, the main thrust... the main way people want to invest their money... is in quick turn stuff. They can see the success that long term Buffett-style stock market investing has... they even hear the stories of the traders who go $100k in the hole in one day... but the lure of the quick and easy overshadows all of that. Just like the lure of the quick and easy - subject-to, wholesaling, lease/option, no money down - oversadows the 25% down thus creating a positive cashflow, the book you mentioned talks about (I beleive that's its basic concept. Please correct me if I am wrong).

And the final reason... which would certainly apply to some people... is one of stigma. Being a landlord vs being a stock market investor.

Michael Ross


Discover how we generated $2,142 worth of business with a 15 word ad, within one month

...the stock boards you go to? (If you don't mind sharing and have since forgotten some of the jokes I've made at your expense).

-Anon

> Don't see anyone asking such basic questions
> on stock market boards? Don't see people
> saying, "XYZ shares went up 1 cent
> today after falling $25 over the last two
> months, should I buy them now?" (At
> least not on the stock boards I go to.)

> Can't comment on the number of books
> written... only the number of books
> published.

I don't think that is relevant--surely how many books are being bought is what is important.
That being so, then Amazon would show you that Real Estate books are selling more than Share Market books.

Bill Myers, surely the master of the crystal ball, reported a while ago that Real Estate was in 6 of the top 10 sellers on Amazon.
That means people are buying books and are interested in Real Estate.

> As they are publishing more stock market
> books, it would appear stock market books
> outsell real estate books.

Don't agree.
Check on Amazon.
You are assuming this.

> Because of the media.

???

> When was the last time you heard the mass
> media mention anything about any kind of
> instant wealth due to property?

Or shares?
Surely most understand that shares and real Estate take several years before compounding steps in?

> People know property is a buy and hold
> thing. They want it to be faster and cost
> less.

I think most people realise shares is buy and hold too.

In Sydney it is buy and hold not too long!
The Real Estate is growing beyond belief.
In 10 years time the medium house price will be close to a million dollars.

But with all the wealth creation seminars (check out the latest Wealth Creator magazine) most people are starting to realise that borrowing 100% on your properties equity and using leverage will make you rich faster than most other ways.

In shares, the bank has the option of forcing you to sell if the price drops beyond a certain point etc.

>Enter the "No Money Down" idea.
> Enter the "Subject-To" and
> "Lease Option." Enter
> "Wholesaling." Satisfies the
> instant gratification crowd.

The No money down bit means you can borrow 100% for maximum leverage. Not instant wealth.

> Something a lot of the RE sellers mention is
> their dislike of fixing toilets. And so they
> hire a property manager.

> This has always puzzled me. If your toilet
> is broken, call a plumber - that's what the
> property manager does.

Maybe they need a tax break and want to claim more losses aka Fringe benefits tax.

> Anyway. The difference is: stocks take far
> less cash, is quicker and easier to get
> into, involves zero negotiating, and doesn't
> require any bank red tape.

But banks will lend you 100% of costs for a property, without telling you to sell it if it drops below a certain price as with shares.

> Property, on the other hand, requires money
> (if not yours than someone else's), time,
> bank red tape, title companies and/or
> settlement people, negotiating, time, money
> spent on advertising, credit checks,
> employer checks, did I mention time?
> Research, education and learning, time, and
> sometimes real estate agents.

> Negotiating. Bank red tape. Real estate
> agents. SLOW turnaround. Long Time. Money.
> Everything people hate. That's what real
> estate investing means.

All of this is infinitely easier for the pleb in the street to handle than buying shares--because everyone knows that they dont make land anymore.
We all know real estate goes up....a simple supply and demand thing. Most people do not have a clue how the share market works and consider it to be a thing shrouded in mystery.

About 70% of the poulation in Australia own a house, compared to the 40% odd percent that own shares.

> Go to the discussion boards devoted to each
> topic - real estate vs stocks. See the
> million real estate questions... here is a
> house and they sellers want $350k, it has
> zero equity, will rent for half the mortgage
> payment and is about to go into
> forclosure... how can I buy it? Or, is there
> a deal here? Or, I have bought it subject-to
> now what do I do?

All this proves is that there is room for a product to simplify the process.
This is a basic product creation enviroment.

> Basic hand holding questions. Questions of
> people looking for an easy way. Questions
> from people who can't be bothered reading
> archives or spending a few bucks on a real
> estate book.

Hence the videos/DVD's /seminars on wealth creation to cut thru all that mumbo jumbo and MAKE IT EASY.

> Don't see anyone asking such basic questions
> on stock market boards? Don't see people
> saying, "XYZ shares went up 1 cent
> today after falling $25 over the last two
> months, should I buy them now?" (At
> least not on the stock boards I go to.)

That should be a clue not to create a shares made simple product then.

> It's the same reason why in stock market
> investing, the main thrust... the main way
> people want to invest their money... is in
> quick turn stuff. They can see the success
> that long term Buffett-style stock market
> investing has... they even hear the stories
> of the traders who go $100k in the hole in
> one day... but the lure of the quick and
> easy overshadows all of that. Just like the
> lure of the quick and easy - subject-to,
> wholesaling, lease/option, no money down -
> oversadows the 25% down thus creating a
> positive cashflow, the book you mentioned
> talks about (I beleive that's its basic
> concept. Please correct me if I am wrong).

I don't agree with you.
I don't think most people think you can get rich overnight with shares.
That is why much more people buy real estate--look at the figures.

> And the final reason... which would
> certainly apply to some people... is one of
> stigma. Being a landlord vs being a stock
> market investor.
I have never heard this before.
I bought my first property in 1990 without having a clue.
Now I have several properties worth well over $1 million. Only in the last 2 years have I realised what I should have been doing.
Real Estate has always been the easiest way for the average person to create substantial wealth.

Tom B.

Tom:

My post was written as a response - an answer - to a question which was asked. Everything in it must be read with that context in mind. Okay?

Now let me address some of your points...

70% real estate ownership in Australia...

First, this number is actually a number which combines those who OWN with those who are PAYING OFF. It has been this way for something like 50 years.

Please don't confuse this - owning or paying off a house - with investing in real estate to make money. 70% of the people in Australia do not own investment property. If 30% of the people rent, and something like 90% of people with investment proprety only own one investment property, you cannot come up with 70% of the people owning investment property.

If we accept your number that 40% own shares... and shares are viewed as investment (after all, you cannot live in shares), then percentage wise, more people own shares as investments than own property as investments.

As for the other items... again. My post is to be read in the context of it answering a question.

Landlord vs Stock Investor could be a reason. Is it? Who knows? I'm sure there is someone somewhere who feels that way.

Fixing toilets. I was refering to the statement made by the likes of Robert Kiyosaki who say people tell him they don't want to invest in real estate because they don't like fixing toilets, and Robert tells them he doesn't either so hires a property manager. Again. You need to read my post within the context it was written.

My mention of the Creative RE techniques finished with instant gratification. Not instant wealth. There is a difference. Bank red tape and all those other things delay gratification.

Some banks may lend 100% of the value of the property when you play funny games with the sales prices and the like... but only the stock market allows you to invest ten times the amount of money you have. - Which means a loss will see you totally in the hole.

"Real Estate has always been the easiest way for the average person to create substantial wealth"

Agreed!

Michael Ross

P.S. Where abouts in Sydney are you based?

Hi Robert,

You already got some excellent answers from Boyd, Mel, and Michael....

I'll just add that the stock market can be addictive!

It can be very exciting, since you always know exactly where you stand.

With property, you only really know exactly where you stand when you sell. Of course, you can get an "idea" by making an estimate of what your property is worth, but you only really know when a buyer comes and pays you a certain price for it.

The stock market is different. With stocks, you know exactly what your stocks are worth every minute that the market is open.

Your fortunes can go up or down by thousands of dollars in a day! Because of this, it's very easy to get an "adrenalin rush" from stocks.

When you do well with stocks, making money never seemed so easy.... (Of course, the flip side is when you're doing badly, losing money never seemed so easy either!)

The stock market is NOT a casino - while there is an element of chance, as there is with anything business-related, there are also rules of logic too. However, even though the stock market is not a casino, it can have the addictive properties that a casino can have too.

- Dien Rice


This is what I do while I wait for the stock market to open!