Real estate empires don’t build themselves, and they don’t just materialize overnight. Victor Whitmore can attest that he’s been creating his, in Tulsa, Oklahoma, over the past 20 years. The co-founder of Precision Equity and his new company Equity With Purpose, he is in charge of real estate worth over $170 million. Over the next five years, he plans to close on half a billion worth of commercial real estate deals with his new company, Equity With Purpose.
There was a time, however, when Victor Whitmore knew nothing about real estate. “I was always very entrepreneurial, but I didn’t come from a family that knew anything about real estate investing,” he said. “It captured my attention when I bought my first investment house for $17,000, put a few thousand dollars into it, and it appraised for $57,000 a few months later. It lit a fire in me, a big one, and it’s still burning today.”
That fire led him through significant changes in the market, a global crisis, and different types of real estate ownership. It’s the same fire that’s burning in many other Americans, which is why real estate is becoming more popular by the day as an investment option.
“Real estate is the single greatest vehicle for accruing wealth on planet earth,” says Victor. “It always has been and always will be.”
Still, any real estate investor who hasn’t been born into it has to start somewhere. When Victor started, flipping houses was only just beginning to gain popularity and began to appear on television shows. As a result, his first properties were a couple of single-family homes.
“Investing into single-family homes is a good way to get started. It comes with relatively low risk if you do your homework and is a great way to learn the basics of buying and managing real estate. You’ll not likely become financially independent though buying single-family homes alone. It can make you a lot of money, no doubt, but is most likely not going to give you the kind of passive income and time freedom that commercial real estate can give.”
If that’s the road new investors want to take, they should be aware that the costs can add up quickly. Apart from the down payment, there are many other costs of ownership like maintenance, management, insurance, property tax, renovation, etc. Most new investors are not prepared for the costs of a rental ownership or for renovation costs necessary for improving value. The costs are far more than just the down payment you need to buy the house.
However, access to funding doesn’t have to be a problem for an investor who goes about it strategically. Victor advises acquiring a valuable skill set that will attract people with the funds you need.
“It could be a family member, a friend, somebody you work with, or someone you know, who has a little bit of cash to invest but doesn’t necessarily know how or want to do all of the work,” he says. “You are responsible for boots on the ground and building the value, and then you arrange for some kind of a profit split at the end. I would do that if I were starting over. It doesn’t mean you need to know how to do maintenance, I am not talking about that kind of work. Anyone can do that. Becoming a knowledgeable asset manager is the skill set you’re after. That’s what people invest into. They are not necessarily going to invest into somebody who knows how to paint. All of that work should be hired out. They want somebody they can count on to build value in the real estate. I have owned thousands of apartments, for example, and have never once fixed anything in any of them. Learn how to add fifty thousand to the value of a house with just a few decisions, not how to save $400 painting a room yourself.”
Funding doesn’t always have to be a problem for new real estate investors. Because of real estate’s overall ability to preserve its value and the increased demand for rental properties, as well as other market-driving factors, there’s been an increased interest in real estate investing from people who have the money to do it. However, what they lack, even if they’re not aware of it, is time and knowledge of how to acquire and manage it. That is where a savvy new investor can get their start and can begin to build their knowledge base.
“I see people all of the time who have been very successful in their business but don’t really have the time to learn how to build a real estate portfolio, which is where they need to be putting their money so that they can one day have time freedom,” says Victor Whitmore. “It took me a 20-year career just to get here, and I do it full-time.”
There’s a solution in that case, too — find a real estate company buying deals that are open to investors. Working with someone like Victor Whitmore, with 20 years in the business, has a long list of perks, like leaving the decision-making to those who’ve been in the field for decades and have a proven track record.
There are ways to benefit even more from the experiences of people who’ve done it all. For example, Victor Whitmore is working on a new project called Equity With Purpose. This investment program brings together investors and business owners looking to build passive income through real estate investment but also allows them to do it with greater purpose by allowing them to sponsor people just starting out with investing, if they choose to. The program came about due to Victor Whitmore’s need to infuse purpose into the investment process beyond sheer money-making.
“Jonathan Conneely and I put this together to create a high-level mastermind where up-and-coming people just starting out can get a hand up,” he explains. “Investors can sponsor people who are ready to learn to invest and create generational wealth but don’t really have the means to do so quite yet. So, they put in a small amount, their sponsor matches it, and the rest of the masterminds can match it as well if they want to. The purpose side of this has been a game changer for all of us.” Victor said.
From there, the sponsors help the person learn about wealth – what it is, how to create it, manage it, and pass it on to coming generations. The program aims to help people who need that extra push to get into a better situation in life, and they believe real estate could be it. While the availability of the program is limited, Equity With Purpose is affording an entry point into real estate investing to those who may not otherwise be able to.
“The program allows people to get the engine started, to go through the entire process of investing into real estate, and then they are mentored by a group of very high-level and successful people on all things business going forward. It’s very powerful. We are changing the entire trajectory of people’s lives and their families doing this,” said Victor.
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