Ninety percent of all millionaires became so through owning real estate
Rudyard Kipling originated the phrase "the world's oldest profession". His 1888 story about a prostitute begins, "Lalun is a member of the most ancient profession in the world." I Googled "world's oldest professions". Mr. Kipling may have been playing fast and loose with the truth.
According to Google, the world's oldest profession is toolmaking, originating in Ethiopia 2.6 million years ago. The world's 8th oldest profession is building, originating in Ancient Mesopotamia between 10,000 – 15,000 years ago. Humans were building houses long before harlotry and whoring started contributing to the world’s gross domestic product.
There is no shame in being turned on by bricks and mortar. It appeals to all the senses – you can see it, touch it, smell it, taste it and even hear it, especially when filled with tenants. In a digital world, anything that brings us back to our physical roots is awesome. Real estate is the old economy.
When Amazon, one of the most digitally advanced companies in the world, bought a bricks and mortar grocery chain (Whole Foods) in 2017, it immediately pricked my libido. Why was Bezos spending almost $14 billion on an old school grocery chain? The media spoke about synergies, scaling businesses and feeding a world of vegans with lactose-free, GMO-free organic food. I believe the physicality and tangibility of Whole Foods were the foundation of the transaction.
The Perfect World of Passive Income
Real estate offers many money-making opportunities: flipping condos, renting multifamily homes, crowdfunding rentals and real estate investment trusts. The list goes on. Residential real estate investments are the most common forms of real estate investing. These include single-family homes, condos, and townhouses that can be re-sold or rented out for a profit.
Rebel Finance focuses on passive income. Therefore, we are not going to focus on real estate flipping. Flipping is not passive. We are going to focus on rentals.
Airbnb and the sharing economy has added a new dimension to real estate investing. You can buy a condo in Tulum, Mexico, slap some paint on it, install an indoor swing, loft the bed and put a rug on it and create a meditation space, and bingo – you will find hippie Americans willing to shell out $100 per night.
Property rentals are beautiful. John Keats, in his poem 'A Thing of Beauty' proclaims that a thing of beauty is a joy forever. Beauty never passes into nothingness. Our earth is replete with innumerable natural objects full of beauty. Keats wrote this poem while sitting outside a beautiful block of council houses in Bethnal Green. He was inspired by the flow of rents he could extract from these assets.
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