Conversely, in places like North Dakota, Wyoming, and Iowa, there is not the same growth—people simply do not have the same desire to flock there. Consequently, growth is likely to be less than the national average. These trends are relatively stable and predictable. In other words, if you want to beat the national average, all you have to do is invest in those regions that for years have exceeded
the national average. Now if you live in Cheyenne, Wyoming, you may find this advice discomforting. You may say: “What is wrong with  Cheyenne?” And I would have to answer that having been there, there is nothing wrong with the place per se, but that as far as real estate is concerned, it is not exactly bustling: At least a third of the commercial space downtown is vacant, and the statistics on residential property show slow growth for a long time. So, even if you wanted to continue living there, why would you invest there, when you can jump on an airplane, fly to a region that has higher than average growth, and invest there? People are perversely obsessed with investing in their own
town or city or area, when sometimes it would make much more sense to invest elsewhere. Look at it from another perspective. Imagine you have never been to New Zealand, but you wanted to invest in real estate there. Now Auckland, in the north of the North Island, is the biggest city in the country. It is not the capital, but it has over one million inhabitants out of the total population in the country of some 4 million people. What’s more, the population growth in Auckland is twice the national average.
Taken from : Dolf de Roos - Real Estate Riches

The most easily overlooked source is simply the small column classified advertisements in the local newspaper. These are not the big display ads put in by the large real estate companies, but rather three- or four-line, single-column ads. The main reason why these may be a great way to find properties is that often this is the advertising method of choice used by owner sellers who are not using a real estate agent. Why do I like it when no real estate firm is involved? Because the chances are that the owner used his or her own resources to try to figure out the value of their property. Often they will be way above the market value, but by the same token, they will often be way below. That is an opportunity for you, assuming you know how to evaluate these properties. Also, if an owner-seller has a sign up on their property, and they run a few ads themselves, then you will have less competition than if the property was listed with a real estate firm, as the firm would not only put a sign up on the property and run (much larger) ads in the newspapers, but they would
also have the property, complete with photo, listed in their real estate magazine, in the computer system for their franchise organization, on the Web, and maybe even with a multiple listing
service so that just about any agent or buyer can find it. Finally, when you contact such an owner-seller, he will not have had nearly as many inquiries as an agent would have (had an agent been involved). So your offer may be more welcome than it otherwise would have been.
Even if a small column ad has been put in by a real estate agent, however, it is still worth pursuing: A great deal is a great deal, no matter how you stumbled across it. One fabulous investment I came across many years ago was in fact advertised by a real estate agent as a column ad in the classified section of the newspaper. It concerned a tiny property (eighty-five square meters) on the corner of a busy intersection. It was the only commercially zoned property in a residential suburb, and had as the sole tenant a fish supply shop. The rental was $10,400 per annum, and the asking price
was $59,000, giving a yield of 17.63 percent. By the time I spotted the advertisement, it was already late on a Sunday night. I phoned the number, and got the agent at home. I said to him, almost resigned: “I suppose this property has gone by now,” fully expecting him to say, “Yes, and my phone hasn’t stopped ringing all weekend.” Instead, he replied that my call was in fact the first he had received on that property. We arranged to look at it at 8:00 the next morning.
Taken from : Dolf de Roos - Real Estate Riches

What this rule says is that if you look at 100 properties, put offers in on 10, and try to arrange financing for 3, you may end up buying 1. These are not just numbers pulled out of thin air. I have found over the years, both through my own experiences and those of colleagues, associates, and students, that on average you must look at 100 properties in order to find ten worth putting offers in on. Good deals are not just there for the picking. You have to spend a bit of time sorting the wheat
from the chaff. I will show you how to do that in the following chapters.
Of the ten offers that you submit, not all will be accepted. In fact, if you found that all your offers were being accepted, what would that tell you about your offers? Simply that you were offering way too much. You could have bought many of the properties for less than you were willing to pay.
So let’s assume that of the ten offers you submitted to sellers, only three were accepted. Does this mean that you own three properties yet? Not quite, since you still have to arrange financing for them. (You would never pay cash! Why use up a lump of cash of, say, $100,000 to buy one $100,000 property, when you could buy four $100,000 properties using a $25,000 down payment and a $75,000 mortgage on each one?)
All right, so you try to arrange financing for these three properties. Again, it is no foregone conclusion that you will have all three properties successfully financed. Maybe only one will work. In this case, you will have looked at 100 properties to successfully buy one.
Taken from : Dolf de Roos - Real Estate Riches

There is one further difference between investing in property and investing in other vehicles that I would like you to consider. . . .
Take people who trade currencies, futures contracts, options, and stocks. Currencies fluctuate by the minute. A myriad of factors go into determining the value that the world places on each country’s currency, and most of these factors change rapidly and often. Consequently, currency traders tend to spend their workday glued to their computer screens, Reuters monitors, and Bloomberg reports. Having your attention diverted could cost you a bundle! You really have to work this market minute
by minute. Not surprisingly, most of the currency traders I have known were burnt out by the time they were thirty. Futures contracts fluctuate less rapidly. Generally, if you keep your eye on the market several times a day, you will probably manage okay. Further down the scale, options are traded all the time, but movements tend to not be as rapid as with futures contracts, and certainly not as rapid as with currencies. Monitoring things once a day is probably adequate for most investors. Stocks generally tend to move slightly more slowly still. Unless you are staking your position based on small, daily movements, most stock market investors manage very well by
monitoring their stocks once a week or even a couple of times a month.
Taken from : Dolf de Roos - Real Estate Riches

As a final example of how to easily beat the national average in property (before I force you to think of some examples yourself), I ask you to think about why people live where they do.
A hundred years ago, in 1900, the Western world was essentially an agrarian society. In the United States, for instance, a significant proportion of the population worked on the land, producing 80 percent of the food consumed (the deficit was imported from abroad). By the year 2000, only 4 percent of the population worked on the land, producing more than 120 percent of the food consumed (the surplus is now exported). The change that permitted a mass exodus from the land (rural living) to cities (urban living) was mechanization and automation. A tractor could plow as much in a day as 100 men with oxen or horses. Refrigerated trucks and ships enabled the transportation of food to new markets where previously that food would have spoiled en route. Crop-duster airplanes for
aerial spraying and fertilizing could achieve in an hour what would have taken a week 100 years ago.
Every operation became much more efficient, eliminating the time-consuming human component. The people no longer required to work the land were not relegated to the unemployment heap, however. On the contrary, vast armies of workers were required to design, prototype, commercialize, manufacture, assemble, test, deliver, install, service, and maintain millions of tractors, trucks, and airplanes, to name but a few of the manufactured goods that typified the move away from an
agrarian society.

So much for beating national averages by choosing geographic locations that have higher than average growth.
What about property sectors that have higher than average growth? Everyone knows that the baby boomers, those people born between 1946 and 1964, are entering retirement. Before long, many of them will be in need of retirement homes and assisted living facilities. Even if the total population numbers do not change over the next fifty years, the proportion of elderly people will go up dramatically. Already the demand for rest home facilities in the Western world is increasing rapidly. The demand for leisure activities and all related services can also be expected to increase.
Given there is this predictable and inevitable trend toward an aging population, is there a reason why you would not invest to cater to the need? In fact, the population in our well picked on North Dakota,
Invercargill, and Tasmania is also aging. Therefore, if you wanted to invest in these regions, then catering to the elderly may easily enable you to beat the averages there. But that raises the following thought.
What if you were invest in those geographic areas where there is greater than average growth (say, three or four times the national average) and, furthermore, in those sectors that were also experiencing greater than normal growth (such as rest homes). Could you not reasonably expect your returns to be far greater than the national average?

When the report in the USA Today article referred to an average increase in house prices of 7 percent, they meant exactly that. Consider all the houses in the country, add together all the increases in value, and work out the percentage change. Now consider a dinky little town somewhere in the back of nowhere. It may be the township that serviced a long abandoned oil well or a shut-down nuclear power station.
Surely it is possible that the properties in this town did not go up by the national average?
That means that somewhere else, a bunch of properties must have gone up by more than the national average in order for the average to be what it is. So let’s put some geographic locations to  this. Now please accept that I do not want to embarrass, insult, or upset anyone living in any regions mentioned! But in the United States, California is known to have exceptionally high growth. No wonder: The climate is wonderful, there are many things to do, and it is a very desirable place to live. Not surprisingly, people move to California from many other parts of the country. Partially for
that reason, the growth in demand is greater than the national average, and as a result, prices have grown faster than average. Predictions are that over the next thirty years, the population of California is going to double again. Therefore, chances are that growth in California will continue to be higher than the national average.
Taken from : Dolf De Roos - Real Estate Riches

When the report in the USA Today article referred to an average increase in house prices of 7 percent, they meant exactly that. Consider all the houses in the country, add together all the increases in value, and work out the percentage change. Now consider a dinky little town somewhere in the back of nowhere. It may be the township that serviced a longabandoned oil well or a shut-down nuclear power station.
Surely it is possible that the properties in this town did not go up by the national average? That means that somewhere else, a bunch of properties must have gone up by more than the national average in order for the average to be what it is. So let’s put some geographic locations to this. Now please accept that I do not want to embarrass, insult, or upset anyone living in any regions mentioned! But in the United States, California is known to have exceptionally high growth. No wonder: The climate is wonderful, there are many things to do, and it is a very desirable place to live. Not surprisingly, people move to California from many other parts of the country. Partially for
that reason, the growth in demand is greater than the national average, and as a result, prices have grown faster than average. Predictions are that over the next thirty years, the population
of California is going to double again. Therefore, chances are that growth in California will continue to be higher than the national average.

Taken from Dolf De Roos - Real Estate Riches

So far we have looked at how people evaluate property relative to other investments. We have talked about averages as if we all agree that averages are a fair and consistent measure that makes the comparisons watertight and convincing. Nothing could be further from the truth! If we were out hiking, and I asked you whether you were warm or cold, and you replied that your feet were a little warm because you had thick shoes and socks on, but you had forgotten your hat and therefore your head was a bit cool, but that on average you were fine, then no one would try to take remedial action.
However, if I put one of your feet in a bucket of ice, and the other one in a bucket of boiling water, and told you that on average you must be about right, you would have a problem with me.

Taken from Dolf De Roos - Real Estate Riches

The tax laws as they relate to property are so incredibly diverse from one part of the world to the next, and so complex within each country, that it would really go beyond the scope of this book to attempt to give the reader specific tax advice as it relates to property investments in specific
geographic locations. However, there are almost universally applied tax principles throughout the Western world that make investing in property even more lucrative than the previous chapters would suggest on their own. For example, consider a property that has positive cash flow before tax. This means that before taxation is taken into account, your income exceeds your expenses, so that there is money left over. In the normal course of business, you would expect this profit to be taxed. Imagine if I told you that, under certain circumstances, the tax man considers you to be running this property at a loss, and therefore lets you claim this “loss” against other income (even though you have positive cash flow!). The net effect of course is to increase your profits even more. Despite the fact that you are already making a profit before tax, the government boosts this profit so that after tax you are making even more.

Taken from Dolf De Roos - Real Estate Riches