10 Other Real Estate Investments: Section 121, Billboards, Raw Land, Storage Units, Wholesaling, Notes, Mobile Homes, Flipping, Private Lending, Hard Money Lending

Those storage units you drove past yesterday are owned by a real estate investor collecting monthly rent. So is the billboard where you saw the ad for a local bank. That house being rehabbed down the block already provided income for a wholesaler, who assigned his contract to a flipper, who borrowed construction financing from a hard money lender, and will be selling it to a Section 121 investor.

All of them are real estate investors.

"Buy and hold" is not the only business model. It may not even be yours.

This book walks you through ten ways to make money in real estate, and shows you how each one actually works, so you can find the one that fits your situation and what is possible for you.

• Hard Money Lending — you could make up to 24% ROI, while being secured by a first lien, and end up with an even higher return if you have to foreclose.
• Private Lending — the space between the hard money lender and the bank, at 7 to 10%, with almost no competition, longer-term.
• Notes — buy the paper, collect the payments, foreclose if you have to.
• Wholesaling — control a contract, assign it, never take title.
• Flipping — buy, rehab, sell; how the tax treatment differs from everything else here.
• Section 121 Investing — live in it for two years as your personal residence, rent it as income property for three years, then sell and take the profit tax-free after depreciation recapture.
• Mobile Homes — taxed as real property or personal property, sometimes transferred with nothing but a title.
• Billboards — regulated, limited in supply, and rented to businesses instead of people.
• Storage Units — 40,000 facilities in the country, about 90% owned by small and medium investors, and the one real estate business that tends to do better in an economic downturn.
• Raw Land — no building to manage, the only investment you can divide into ten properties, and a tax bill you can cut to almost nothing with a timber or agriculture exemption.

Each one gets the same treatment.

The income and the expenses. The cash flow, the appreciation, the leverage, and the tax advantages. Which business entity to use for each situation, and why. The actual business model, deal by deal, with the numbers worked out. What can go wrong. And what it takes to start.

You can start with $3,000 or with $300,000. Several of these take almost no capital. Some are almost passive. Some are a full-time business. That is the point — they are not interchangeable, and one of them is a better fit for you than the other nine.

This should be the first book you read about real estate investing.

Not because it teaches you one thing well, but because it shows you the whole board before you commit to a square. Understanding how the others work will make you better at whichever one you choose.

Written by a lifelong investor.

Michael Lantrip is licensed to practice law in Texas, Virginia, North Carolina, and the District of Columbia, and before the United States Tax Court. He is a former IRS Tax Examiner and a former Tax Accountant for a Big 8 accounting firm. He owned his own Title Insurance Company, and has handled over 2,000 real estate closings. He has had clients in nearly every one of these businesses, and has done several of them himself.

He has written ten books on real estate investing and tax strategy.

Use this book to find what you were meant to do, and get started.