No matter which industry you are working in, your investments should be good enough to have your back. Some investments give you safe but low profits, but some investments give you high returns on the cost of higher risk. But with the help of professionals and your homework you can mitigate the risk, and increase your returns.
One of such industries is Pre Construction Real Estate. Matthew Ablakan is a self-made (millennial) realtor, who took risks, started out earlier and now owns a portfolio of 17 million.
A wise investor, who knows his game, shares secrets of his success and his knowledge of the field. According to Matthew, people in construction industry are the closest to real-estate and are thus the perfect potential investors.
Matthew tells us how he was working at Johnny Rockets and realized that two type of professions are making money for people, real estate and stocks. Stocks are very volatile and risky so he chose real estate. He also offers Mortgage Financing, so any potential investor is not held back because of financing.
His parents struggled a lot and Matthew also had a fire inside him since a young age. He worked on several side gigs and saved money. When he was 19, he bought his first condo, which he still owns, and the price of it was 305,000 and is currently valued at 600,000. It is 617 square feet unit and gave him confidence of investing and continuing his career in real estate.
Higher the risk = Higher the return
Matthew explained how he has seen people losing potential profits, and let go investment opportunities because they were too scared to lose money. A person didn’t take his advice to buy the condo. A few months later, he called Matthew and told him that the price of condos raised by 15,20 grand. Matthew himself is not a major risk taker, he shared that his portfolio wouldn’t have been 17 million if he hadn’t miss risky opportunities in his life.
He left his job all of a sudden without any knowledge in the field, but he knew he had to make his fortune in this field so he got licensed and started it.
Planning and Saving
Despite having a good earning, Matthew believes in careful spending. Even when he was young, he saved 15 grand to start his business and he did. He drives a Volkswagen Atlas, he doesn’t buy expensive accessories, and believes in saving and planning.
Matthew says that youngsters should see their spending patterns, and avoid spending money online. With subscriptions, Uber Eats, and online shopping, these expenses take a good chunk of money from youngster’s pocket. His advice instead of going out for breakfasts, or lunch, eat home food, cancel all the unnecessary subscriptions and don’t keep multiple cards with you. Control your spending, and start saving today and you might build an empire tomorrow.
Best time to Invest
Matthew beautifully explains an old saying. He says that the best time to invest is either Yesterday or Today. If you think you will start investing after 5-10 years, you might never be able to invest. So, if you think you have missed good opportunities, don’t worry, start investing today. If you think you are not good at it, get help of a professional.
Cheap is the Red Flag
Condos typically, the builder requires a 20% deposit. All right, and it’s split up in different ways, depending on the project and the builder, so Matthew’s suggestion to the listeners is that if you have 40 to 50 grand, you could get into the market now. And he gave a caution as well. If you see a builder selling a condo building with a 5% deposit plan, which means that’s all you got to pay 5%. There’s a red flag there, because it’s either you’re buying at the tail end of the project. So, the builder has their financing, they’ve kept some units back. Now they’re releasing them towards the end of the project. So why that’s a red flag? because you maybe paying more, you’re paying way more than the other people in the building who paid less a few years ago.
Consider real estate as any other Investment
When asked about what are people supposed to be looking at? Matthew replied to look at real estate in a completely different light and just treat it like you would treat any other investment. And the purpose is, how do you make money with this, how you should have a secondary source of income.
Is Preconstruction Investment Safe?
Matthew explained that the good thing about pre construction is that all your deposit money up to 40,000, is guaranteed by the province of Ontario, the rest of it is insured. So, the deposits are normally held in trust by the builder’s lawyer, and they can’t really access it. And there is a way to access it. But in order to do so, they need to have some really expensive insurance. They got the deposit backs. Its just opportunity cost you invested in this builder.
Matthew says that instead of buying a 40 grand vehicle, if you have that kind of money, invest in preconstruction, buy a condo!
Same Day Credit!
If you want to get a Line of Credit from bank, Matthew advises that you approach 2-3 banks on the same day, and see if you can get a credit line. Visiting more banks on the same day means, your data won’t be shared with other banks on that day so there is a fair chance to get the credit line from one or two or all three sources.
Matthew shared an interesting fact. The word mortgage is derived from Latin origin and is meant, “Till Death”. And to be honest, this really is the case. Suppose you have a mortgage of 30 years and you started it in your 30s. After the mortgage ends, you have spent a good portion of your life. Real estate investments help you earn from even the house you are living in. So instead of dividing, you start multiplying everything.
- What’s the most expensive residential property sold globally? In Hong Kong. It was sold for 657.9 million US dollars.
- What was the first real estate transaction in the new world of America? And how much was it for? Louisiana purchase 1803. It was a land deal between the United States and France, in which the US acquired approximately 827 1000 square miles of land west of the Mississippi River for $15 million back in 1803.
- Why is it called Real Estate? The word real is derived from Latin meaning existing actual or genuine. The word estate is an English translation of the Old French meaning status. Soit means having a particular status.
Invest Money in Your website
The lenders might be googling you right now! Maintain your social media profile, and also invest money in your website. Your online image is more important now than ever. They want to see your lifestyle, what you drive, where you are vacationing etc.
Land NFT’s/ Online Real Estate
Matthew discussed NFTs in detail. He bought his first piece of digital real estate for $500 that exists in the NFT Metaverse world. It’s part of the blockchain, and it’s your property, h=He might not get any return out of it, but he doesn’t want to miss out something and regret later. He thinks the future of Metaverse is bright.
He also explained how the piece of land can be used in digital games in Metaverse.
Here are some questions Matthews replied!
Favorite construction word?
What’s your least favorite construction word?
Construction costs? It works.
What turns you on and construction?
What turns you off in construction?
All those moments that you pull your hair out
What’s your favorite vehicle in the entire world?
What’s your least favorite vehicle?
What construction sound or noise do you love?
The moment the first shovel hits the ground.
What construction seminaries do you hate?
The drilling, The hammering.
What profession other than your own would you like to attempt?
I would like to create a piece of technology.
What profession would you not like to do?
If heaven exists, what would you like to hear God say when you arrive at the pearly gates.
Well done my good and faithful servant.