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Real estate mogul Robert Kiyosaki and his wife, Kim, have built an empire of over 7,000 apartments. Their success lies in adhering to his two key principles: letting employment drive real estate investment decisions and avoiding luxury properties.
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In a recent interview, Kiyosaki revealed how he and Kim have gotten through the COVID-19 crisis by adhering to these proven guidelines. “Is there any opportunity in the real estate industry today? If there is a bright side, what is the bright side? Where are the opportunities?” he asked.
We will introduce Mr. Kiyosaki’s two principles of real estate investment for asset formation.
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Principle 1: Jobs drive real estate.
“One of the key principles we have always held is that jobs drive real estate,” Kiyosaki said. “Once you can find a location that will protect them from the crisis in terms of jobs and employment, you should look into real estate opportunities in that area.”
With mass layoffs and many small businesses closing due to the pandemic, Kiyosaki warned against investing in regions that rely on hard-hit industries such as tourism and oil.
“Take Orlando, Florida, for example. Disney World was closed. Thousands of jobs were lost. Same thing with Las Vegas. It was like a ghost town,” he explained. “Look at Houston. Oil prices have fallen. This is a problem because their unemployment rate is even higher than the rest of the country.”
Instead, Kiyosaki advised them to thoroughly identify regions that are more resilient to economic shocks. “Take your investment money and go where people are working. If people are moving, you might as well move.”
Principle 2: Avoid high-end properties
“The second principle is not to chase luxury properties,” Kiyosaki said.
He elaborated that luxury real estate is the most vulnerable during a financial crisis. “When there’s a crash or a correction, the first people to downsize are people who live in high-end apartments and high-end homes. These high-end renters are now living in so-called ‘B-class’ properties, or in the middle of the street. I am trying to move into a property. ”
Mr. Kiyosaki credited this strategy with contributing to tenant retention. “Robert and Kim are in a very good position at a time when many landlords are worried about their tenants paying their rent or worse, giving up their apartments. By following this principle, many rent We no longer lose people.”
By targeting mid-priced units, Kiyosaki Family Court targets renters who need a place to live even if they are forced to downsize. “People are going to have to downsize, but they still have to have a place to live,” Kiyosaki said.
conclusion
Robert Kiyosaki built his real estate empire by letting employment trends dictate his investment decisions and avoiding luxury properties. In times of economic turmoil, these principles provide stability for investors through changing tides.
“If you don’t have any financial education first, don’t invest your hard-earned money into something and part with it just because you read this ‘hot tip’ or it seems like a good idea. Please do so,” Kiyosaki advised. “Get financial education first.”
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This article originally appeared on GOBankingRates.com: Robert Kiyosaki says these two real estate investing principles will build wealth
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