Green Homes for Sale

If you were looking at real estate ads and saw one that stated “green homes for sale”, you may at first wonder why anyone would a listing stating the color of their home. This is not what this type of ad means. It is just stating that the homes for sale are earth friendly and energy efficient. Green homes for sale are being built in an effort to less the carbon footprints we leave behind.

When you purchase a green home they will contains all or some of the following features that are earth friendly.

• Fiber cement siding
• Alternative power system like wind and solar
• Recycled building insulation
• No VOC stains and paints, which stands for volatile organic compound. It is any compound that is carbon-based and will vaporize at standard room temperatures. Some of the more prevalent ones are formaldehyde, acetone, and methane.
• Solar powered hot water heating

Even if you do not live in a green home, there are things that you can do to increase your energy conservation. It will even help contribute to saving our environment. Making your home a green home can help to reduce global warning and save the homeowner money. It will significantly better the environment and require little effort for the homeowner.

Making a green home

• Instead of using the standard incandescent light bulbs start to use compact fluorescent light bulbs (CFLs). When you switch to the CFL’s you can save per year over a hundred dollars. You can find these lights in the same aisle as your regular bulbs but they are little more expensive. In the United States, if every house switches the type of light bulbs they were using to CFL’s there would be a reduction in greenhouse gas emissions of one trillion pounds.
• Install a thermostat that is programmable-with this type of thermostat the homeowner can program the thermostat so that the air conditioner or heater is off when homeowners are not at home. The programmable thermostat can be programmed so that it will cool or heat your home shortly before the homeowner arrives home. This change could save the homeowner ten percent or more on cooling and heating costs
• Plug air leaks-this will help the homeowner save money and practice conservation. You can do this by installing weather stripping, keep the temperature in your home from rapidly fluctuating, and caulk windows correctly to stop air drafts.
• Energy Star® rated appliances-these reduce the amount of electricity that is needed to operate them so they have less of an impact on the environment. They will also save on your energy bill.

Drive for Show, Putt for Dough

Last week I shot a 97. That was my best round yet. I started golfing about 3 years ago, and I am enjoying the challenge. I first took lessons to learn how to hold the club and make contact with the ball, which was surprisingly difficult. I remember that accidentally breaking a club in half was the highlight of my first lesson. Yes, I was swinging hard. I was trying to show off and hit the ball farther than a friend. That was embarrassing. Travis took me to one of his favorite courses for my first 18-hole round. Once again, I thought I had to hit the ball far, so I swung hard. The ball sailed… right into a house.

It was not too long before I started consistently hitting the ball, so I recently took lessons to see if I could hit straight. I had hopes to score under 100 this year, so it was satisfying to reach that goal last week. The instructor in my recent lesson told me over and over to control my club speed and practice my short game. Keeping the ball in play by focusing on hitting it straight, instead of far, and getting better at putting, would shave several strokes off my game. “It won’t look as good as the big drive,” he explained, “but it will win you the round.” This is why they say, “drive for show and putt for dough.” A far drive looks great, but your money is made with consistency in the short game.

The same idea is true in baseball. The most valuable baseball players have high batting averages and get on base regularly. They are not swinging for a home-run every time they go to the plate. Home-runs are exciting and rewarding and fans love them, but at what expense? Big home run hitters also have high strike out rates. Focusing on just making contact with the ball to get on base helps to avoid an out, while moving runners around the diamond. This is how the best teams win games. Singles win games.

This is also true in real estate. I have one client in mind that is always swinging for a home-run. He is a great guy! He has a big heart and is a lot of fun to be around. He is also a fantastic builder and rehabber. The problem I have seen though is that he is passing on singles, so he can swing for the big one. He wants to make six figures on everyone flip, or more by doing new construction projects. He keeps waiting for the perfect deal, or he gets into trouble doing deals that are too big for him. Either way, he is not helping his cause. There seems to be a simple fix looking at it from the outside, but he has the mindset that he needs to hit it big. A short drive down the fairway or a simple base hit is not exciting enough for this experienced real estate investor.

I have another client that is only looking for base hits or the easy chip out of the trees. He is doing deals for profits in the $15,000 to $20,000 range in Denver. Some would say that is too thin, but he is doing three or four a month!! And he recently got lucky and is going to make over $100,000 on a single flip in Denver. He understands that luck behind it and is happy, but he is not setting his mind on those big pay days.

The annual income difference between these two highly capable investors is over a half a million dollars.

Even the best investors that I know work towards a simple shot off the tee. They want the easy and safe base hit over and over. Some of them have increased what they consider a base hit, but they all started small. It is a process to work up to, but no successful investor that I know is always trying to hit the home-run or the long drive over an obstacle. They take those when they present themselves but are on the hunt for the straight shot down the middle; which is why I would suggest keeping your real estate business simple and grow with it over time. Don’t do a bad deal but don’t pass on a good one. Our office is more than happy to have a conversation with you about your real estate plan or a specific deal to help guide you to success. Consistency is key. Whenever I swing my club hard looking for the big drive, I come up short. The easy swing without the pressure produces great drives. Remember… four singles without losing your ass is better than swinging big and missing.

FINANCIAL DEFENSE The True Path to Wealth

“Congratulations! You play fantastic offense” This was said sarcastically by Thomas J Stanley in his famous book, The Millionaire Next Door. I have not read or listened to this book in more than eight years, but I still remember this phrase. That one, and the millionaire saying, “I drink two types or beer. Budweiser and Free.”

The message in his book is that you need to watch your spending with more tenacity than to increase your income. Obviously, it is a combination of income and spending that creates wealth, but controlled spending is far more important. As long as you spend less than your income, you will be moving forward, and consistent progress will make you rich! The problem I often see is that people spend what they make, or worse, spend more than they make. In either of these scenarios, you are at best staying even, but most likely going backwards. Many want to be investors and entrepreneurs, drink the get rich Kool-Aid and focus all their energy on increasing income. That is what sells coaching programs, mentor-ships and advertising on TV shows. With energy and focus comes success, so many of these entrepreneurs and investors see results. And with the positive results of higher earnings comes… higher spending!

I am fortunate enough to live in a great neighborhood. Most people in the neighborhood are high income earners, but several of them live above their means. It is not uncommon for me to see neighbors move out of the area because they can no longer afford to stay. They are the same ones with the new cars and the extravagant parties. It is a look at me attitude and peers feed on the pressure to keep up. This creates a little spiral of friends living outside their means. But hey, at least they are all moving backwards together.

The ones that live below their means feel pressure to spend or get left behind. And on the surface, many of them do. One challenge about living below your means is it takes years before you realize the benefit. During those years it seems as though you are missing out. I see it so clearly and understand the pressure, but I also see a high percentage of our aging population that should be retired, working their asses off. They are stressed and busy and churning to get by.

If you have not yet, you owe it to yourself to read The Millionaire Next Door. This book really sank in for me on the power of financial defense. Of limiting spending and protecting your earnings. I am able to live in my neighborhood, provide for my family, enjoy my time away from the office, and many other benefits because of the control I had with spending as my income was increasing. As you invest earnings for income, instead of spending it, you will witness exponential growth of income.

If I recall correctly, the quote from the book “Congratulations! You play fantastic offense” was referring to a broke high earner. He made more than his peers but would miss a mortgage payment if his income stopped. That is not a comfortable life, yet he was proud of it. If I could help one piece of financial advice sink in, it would be to focus on defense before offense.

Travis and I both recently read the book, Set for Life, by Scott Trench. This is another fantastic book focusing on the correct way to build wealth and retire early. It is a simple formula. Spend less than you make and invest the difference.