Book Review - A 20,000% Gain in Real Estate

This is a short "how I made a fortune" book. In short, "A 20,000% Gain in Real Estate" is the story about how Kevin Kingston went from being a down and out Wall Street stock broker whose career went off the rails in the 2000 tech wreck to running a very successful real estate investment business in about 5 years.

At only 113 pages long (including appendices) the book is refresingly free from waffle and can be read in a few hours. It also contains some valuable lessons for anyone looking to make money in real estate:

1. use of leverage: Kingston explains very clearly how he raised the money for his investments and how he made leverage work for him. More detail on the key terms to negotiate when raising money would have been useful

2. yield on investments: This is what services the debt and, for some investors, pays the living expenses. It's also one component in determining value. Put differently, good cash flow gives significant downside protection

3. adding value: the ability to add value through refurbishment and other arrangements is an effective way to significantly increase your return on equity

4. doing your sums: working through the numbers is a critical part of making investment decisions

5. the importance of location: the lession I took from the book is that the best location does not mean the most expensive areas. Rather a well located property is one where the amenities, demographics and the overall tone of the neighbourhood will all work in your favour (especially if you are adding value through refurbishment). The book may have benefitted from spending more time on this issue

What was missing from the book was the nitty gritty advice on matters such as legal issues, tax planning and the like. In my view the book did not suffer from absence of detailed coverage of these issues (and there is plenty of other material on these issues available in other books or on the internet). As mentioned above the concise and to-the-point writing style meant that the key points came through very clearly.

All in all a good motivational read that brings out a number of the critical concepts involved in making real estate invetsment successful but not a sufficiently complete coverage of the issues to rate as a good "how to" book.