21 Timeless Lessons From Old School Real Estate Investors

Old School Real Estate – 21 Timeless Lessons From Experienced Investors

Updated & republished in May 2020

I began investing in 2003. I’ve been through rising markets (2003 – 2006 & 2013 – 2017) and a falling market (2007 – 2012). And 2020 and beyond could be another changing market.

But real estate history has much more to teach than the lessons I’ve learned in my relatively brief 18-year career.

So, my favorite way to learn beyond my own history is by studying the lessons of investors who’ve been around for a while.  You could call these veterans “old school.”

In the rest of this article, I will share the best, most timeless lessons I’ve learned from twenty-one old school real estate investors. Some of these investors I learned from personally, and others I met only through books or classes.

I hope you’ll find the lessons as helpful as I have.  If you consider yourself old school and have lessons from your real estate investing experience, be sure to share them in the comments at the bottom. I’d love for this to become a massive collection of wise lessons we could all benefit from.

Now, onto the old school real estate investors!

21 Lessons From Old School Real Estate Investors

1. Tom Carson – Work Hard

Old School Real Estate Investors - Tom Carson
The first old school investor is my dad. I worked with him my very first year out of college, and he is obviously one of my most important real estate mentors.

The most memorable lesson from my dad, however, is not directly about real estate. Early on he taught me, primarily through his example, that hard work trumps nearly everything else.

As a beginner in real estate investing, I remembered this lesson. I had very little knowledge and zero experience.  But I did have my ability to hustle and work hard. That has made all the difference.

2. John Schaub – You Can Make it Big on Little Deals

I’ve subscribed to John Schaub’s newsletter, read his books, and attended his classes for almost my entire career.  But, of the many lessons I’ve picked up from John, one stands above the rest.

John teaches that you can make it big financially on little real estate deals.

Big real estate empires, syndications, and impressive stats make for catchy internet headlines. But getting big also adds risk and hassle to your life.

Just a few, small investment properties can provide sufficient income to achieve financial independence and do what matters in life.

The real question is why do more?

3. Jack Miller – Feasible Financing is the Key

Old School Real Estate Investors - Jack-Miller
Jack Miller is now deceased. But his seminars and his books have been very influential in my real estate career.

One of my favorite lessons from Jack is that feasible financing is the key to real estate cash flow and wealth.

Jack often said that more investors go out of business because of bad financing than any other reason. And the 2008 – 2010 U.S. economic recession proved him right. Many real estate investors, banks, and companies went out of business or received bailouts because of negative cash flow or because they couldn’t pay off financing that matured (i.e. balloon notes).

Because of Jack’s repeated warnings, I built my own rules for using debt.  I also chose to primarily use creative financing from sellers and private lenders instead of loans from banks.

I’m convinced this lesson from Jack helped my business partner and me to survive and thrive during our own plunge into a real estate recession.

4. Louis Stone – Find a Need and Fill It

Old School Real Estate Investors - Dr. Louis Stone

Louis (aka Dr. Stone) has been a mentor, private lender, and friend since my time as a college student at Clemson University.  I profiled all of my favorite lessons from him in an articled called Lessons on Real Estate Investing, Alligators, and Fleas.

Dr. Stone always uses folksy, memorable quips to help remember his lessons. One of my favorites is “find a need a fill it.”

This lesson teaches that business and real estate investing are about serving people. And people have needs.  So, if you just concentrate on filling those needs as often as you can with excellence, the rest will take care of itself.

This lesson has been like a compass for me in all of my business pursuits.

5. Greg Pinneo – The 3 Pillars of Real Estate

Old School Real Estate Investors - Greg Pinneo

Greg Pinneo began investing during college, and for many decades since then he’s bought, built, remodeled, sold, and rented MANY properties, primarily in the Seattle, Washington area.

Although I picked up many other influential lessons from Greg’s seminars and courses, the 3 Pillars of Real Estate Investing stands above the rest.

Greg’s 3 Pillars are:

  1. Location
  2. Terms
  3. Expandability

Together, these three qualities make excellent real estate investments.

Location is important, but without good terms (price, financing, etc) you can still lose money.

Terms are important, but without a good location, the terms are worthless numbers on paper.

And expandability is the secret sauce of the best deals. Expandability is the opportunity below the surface that other investors don’t always see. It includes remodeling, re-zoning, changing property uses, raising rents, fixing title problems, etc.

If you can find deals with all three pillars, you have the foundation of a very profitable real estate investment.

6. Robyn Thompson – Give a Little Extra to Your End Customer

Old School Real Estate Investors - Robyn Thompson

Early in my career, I attended a seminar about fixing and flipping houses with Robyn Thompson. My business partner and I used what we learned to earn a living flipping houses for many years.

One of the best lessons I picked up from Robyn was to give a little extra to your end customer.

In the remodeling world, this meant Robyn would do extra repairs like installing a master bath/shower that was nicer than most starter homes her customer would see. It also meant she would hold her buyer’s hand and help them figure out the maze of financing hurdles the first-time buyer would face.

These “extras” were what set Robyn apart from the competition and made her business very profitable. Just like she did, you can all find ways to give extra to your customers in whatever business you happen to be in.

7. Ron Legrand – You Can’t Build Wealth If You Can’t Pay the Bills

Ron Legrand is another teacher I studied early in my career.  He teaches how to find good deals and quickly resell them (both for cash and on financing terms).

While Ron certainly has a focus on building long-term wealth and income, he teaches a lesson about short-term cash flow that has stuck with me.

I’m paraphrasing his words, but he says something like “You can’t build wealth if you can’t pay the bills.”  He finds that many real estate investors are equity rich but cash poor.  And because real estate is relatively illiquid (i.e. can’t sell quickly), this lack of cash can become a big problem.

As a result, Ron teaches to prioritize cash flow by selling at least some of your properties quickly. This gives you cash for paying the bills, building reserves, and reinvesting into new properties.

Following Ron’s advice, early in my career, we sold some properties that I’d love to still own.  But in the end, we survived! And the cash flow from those sales was a big reason.

8. Vena Jones-Cox – Multiple Streams of Marketing

Like me, Vena Jones-Cox began investing very early in her adult life. She’s now been successfully doing it for decades.  Vena also has an excellent radio show and podcast called Real Life Real Estate.

Vena specializes in finding good real estate deals.  And when I heard her speak for the first time, I remember that she emphasized having multiple streams of marketing to find good deals.  She said that if you just depend upon one source of deals, like the MLS, you’re likely to get stuck.

I now compare this to going fishing.  If you want to give yourself the best chance to catch fish, you’ve got to put multiple fishing lines in the water. You never know which hook the fish will bite.

Similarly, if you want to “catch” good real estate deals, you’ve got to throw out multiple “lines” of marketing. One may work today, and another will work tomorrow.

9. Dyches Boddiford – The Details of Real Estate Matter

Hard Money Lending - Private Lending - Dyches Boddiford

Dyches Boddiford has successfully invested in a variety of real estate niches since the 1980s. I’ve also had the pleasure of learning from him (assets101.com), teaching beside him, and interviewing him over the years.

Dyches is known for his attention to the details of real estate investing. While he knows big-picture strategies well too, he realizes that execution of these strategies depends upon good contracts and knowledge of real estate and tax laws.

So, whatever real estate investing strategy you’re pursuing, commit to learning the details of your craft. It will be the difference between the theory and the successful execution of your investing.

10. Kathy Kennebrook – Direct Mail Marketing Works

Old School Real Estate Investors - Kathy Kennebrook

Soon after starting my business, I attended a class with Kathy Kennebrook called “Marketing Magic.”  It was all about direct mail and how to use it to buy more real estate.

Although I’ve learned from other direct mail experts as well, Kathy’s lessons got me started with the idea that direct mail was a consistent way to find good real estate deals. Since then my business partner and I have bought many properties as a result of direct mail marketing.  I even have property owners calling me 5-10 years after sending them a letter!

Using direct mail is an investment because you must sometimes spend thousands of dollars before you find success.  So, beginners short on cash should be cautious before jumping in. But at some point, direct mail is certainly something any real estate investor should add to their business.

11. William Poorvu – Pros Use Back-of-the-Envelope Analysis

William Poorvu has invested in real estate for decades, and he also taught real estate at Harvard Business School.  I read his excellent book The Real Estate Game (read my book review here).

The most lasting lesson from this book is the power of something called “back-of-the-envelope analysis.”

William Poorvu teaches that the most experienced real estate investors don’t waste time with complex spreadsheets and detailed analysis early in the life of a deal. Instead, they do simple, approximate math in their head or on the back of an envelope. This allows them to quickly decide if the deal has merit (or not) before wasting a lot of time.

This lesson inspired me to write about my own approach to back-of-the-envelope real estate analysis.

12. Jeff Brown – Successful Retirement Comes From a Purposeful Plan

Old School Real Estate Investors - Ron Legrand

I was extremely impressed the first time I read one of Jeff Brown’s posts on the Bigger Pockets blog.  Jeff’s enormous depth of experience was obvious from each lesson and case study he shared.

Most of Jeff’s articles are about using real estate to retire with a large stream of income that lasts for the rest of your life.  And to do this, he encourages you to create a purposeful plan.

You can read his articles to get full details, but his purposeful plans typically include building a portfolio of:

  • Free & clear (no debt) rental properties
  • Real Estate Notes (inside a self-directed retirement account)
  • Real Estate Notes (outside a self-directed retirement account)
  • EIUL (equity indexed universal life insurance policies)

The last recommendation of EIUL is not in my realm of expertise and not something I like personally. But the main point is to plan ahead, work that plan, and use the synergy of multiple strategies to maximize your retirement income.

Jeff was one of my inspirations to write my book Retire Early With Real Estate, which has now been read by over 20,000 people. So, I want to thank Jeff for his ideas and example.

13. Gary Keller – Borrow Models From Others

Old School Real Estate Investors - Gary Keller

Gary Keller is a co-founder of the ultra-successful real estate franchise Keller-Williams. He also invests in real estate, and he wrote the book The Millionaire Real Estate Investor (see my book review here). It’s one of the first books I recommend to new investors.

I loved many parts of Gary’s book, but I particularly liked his emphasis on models. He defines a model as a process or system used to get repeated results.  While most people pay attention to the results, he recommends paying attention to the models that produced the results.

I’ve found that this principle works in real estate investing, business, life philosophy, and even sports.  Now, anytime I Iearn from someone else, I try to tease out the models and processes they use.

14. Mike Butler -Tenants Have a Job to Do

Mike Butler began his working career as a police officer, but he transitioned into real estate investing on the side. Before long, his side business of rental properties gave him a full-time income.

I discovered Mike through his book Landlording on AutopilotIt has many excellent tips and strategies for creating a passive rental portfolio.  But one lesson, in particular, stood out to me.

Mike tells all his tenants that they are sort of like employees. They have a job to do. The tenant’s job includes things like paying the rent on time or early, keeping the property clean, staying as long as possible, and helping to refer new tenants when they do leave.

During Mike’s long meeting with a tenant to sign a lease, he describes these jobs and his expectations. He also tells them the negative consequences if they don’t do their job, and the positive consequences if they do.

This simple reframing of the landlord-tenant relationship is an excellent communication strategy. I’ve tried to adopt it whenever possible when my team members or I have conversations with tenants.

15. Pete Fortunato – Commerce is About PEOPLE

Pete Fortunato and Chad Carson at seminar

Pete Fortunato is an investor of over 5 decades from the Tampa Bay area of Florida. I’ve had the pleasure of attending several live classes taught by him, and I summarized my favorite lessons in My Top 3 Lessons From a 51-Year Real Estate Investing Pro.

Pete has a unique negotiating style. He is very personable and disarming, and it’s obvious when you talk to him that his priority is to help you.

I think this style results from his lesson that “commerce is about people.”  Many real estate investors get caught up in the physical property, the spreadsheets, and the financing of real estate.  But in the end, it’s always about the people you can serve. Without that focus, nothing else really matters.

16. Wendy Patton – Make Money With Pretty Houses Using Terms

Old School Real Estate Investors - Wendy Patton

To make money in real estate, you need to find the ugliest houses and buy them at the lowest prices, right?  Wendy Patton showed me that this is not always true if you use creative contracts like lease options.

Wendy is a long-term investor who has become well-known for teaching how to make money with pretty houses. I originally read her book Investing in Real Estate With Lease Option and Subject-To Deals.

The key principle with creative tools like leases and options is that they reduce your risk. This allows you to be a little more aggressive on the price you pay because you aren’t borrowing debt like a normal purchase.

I have made Youtube videos to explain some of the tools in her book like master lease options and subject-to purchases.

17. Ernie Kessler – Make Money Buying Discounted Mortgages In Foreclosure

Old School Real Estate Investors - Ernie Kessler

Ernie Kessler is another teacher who has passed away since I originally learned from him.  But he made a big impression on me during my first year of investing by teaching me how to make money with foreclosures.

Ernie explained that banks are in the business of lending money and not owning properties. So, when they are forced to take back a property when a borrower does not pay on time, it creates an opportunity for me as a real estate investor.

After studying Ernie’s lessons, my business partner and I bought many properties using a technique known as a short sale. A short sale occurs when a lender accepts less than the balance of the mortgage owed to them.  By negotiating directly with lenders, we bought properties and notes at discounts.

18. Frank Gallinelli – Use Math, Not Emotion In Real Estate Investing

Old School Real Estate Investors - Frank Gallinelli

Frank Gallinelli has been a real estate investor, author, and teacher for many years. I keep his excellent book What Every Real Estate Investor Needs to Know About Cash Flow on my bookshelf as a reference.

My key takeaway from Frank’s work is to use math, and not emotion in real estate investing.

It’s easy to fall in love with a property or a location. But in the end, it all comes down to the numbers. So, your job as an investor is to learn the key numbers and stick to them so that your emotions don’t lead you astray.

Inspired by Frank, I wrote an article that shares how I run my numbers in real estate investing.

19. Jimmy Napier – Invest in Debt

Old School Real Estate Investors - Jimmy Napier

Most people think of real estate investing as owning rental property or fixing and flipping a run-down house. But just as much money can be made by becoming the lender and investing in debt.

Jimmy Napier’s book Invest in Debt is a classic manual on the fundamentals of this real estate strategy. It also includes detailed lessons on using your primary debt evaluation tool – a financial calculator.

My business partner and I have focused on investing in debt as a primary strategy in our self-directed retirement accounts.

20. Mike Cantu – Every Property Has a Job

Old School Real Estate Investors - Mike Cantu

Mike Cantu is a fascinating person and investor. He was a professional skateboarder before he jumped into real estate investing in California in the 1980s.

I’ve listened to many interviews with Mike (like this one) and heard him speak in person. My favorite lesson is his approach to compartmentalizing the financial contributions of each of his properties.

Mike assigns each rental property “a job.” Like a normal job that pays a salary, each of his properties pays for a certain part of his personal life.  For example, property A pays for health insurance.  Property B pays for groceries. Property C pays for vacations.

I love the way this philosophy connects real estate investing to your personal life. After all, improving your life is why most of us began investing in the first place!

21. Bruce Norris – Market Cycles Matter

Old School Real Estate Investors - Bruce Norris

Bruce Norris and his weekly podcast Real Estate Radio have become one of my go-to sources for real estate learning.  Bruce has successfully ridden the ups and downs as a California real estate investor for many years, and he’s also loaned money to many other investors all over the country.

One of the keys to Bruce’s success seems to be his diligent study of market cycles.  He has successfully predicted the timing of the last several market ups and downs in California, and his education resources teach you about the market fundamentals he pays attention to.

I’m still learning a lot in this area, but Bruce has woken me up to the importance of studying markets cycles.

The Value of Lessons From History

Study the past if you would define the future.”

~ Confucius

Because you’re here reading this article, I assume you want a brighter future for yourself and your family. So, I hope the lessons I learned while studying old school real estate investors will help you in your quest to define your own future.

Also, don’t forget to study the people you know who have wisdom and experience. Whether it’s real estate investing or life in general, the collective experiences of those around us can make our own lives better.

Which of the 21 lessons above resonates the most with you? And do you have any other valuable real estate investing lessons you’ve picked up? I’d love to hear from you in the comments below.

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  1. Quite possibly the most comprehensive, well-thought and useful Top ## Ways to Do Something lost I’ve ever read. Full of content and external links for further pursuit of knowledge. We’ll done sir. Glad I clicked thrush the email. This link will be bookmarked!

  2. Hi Chad, Great list of Real Estate Mentors. I have been to several Seminars to hear these mentors speak. Thanks for the reminder of how important Mentors are in the lives of real estate investors. Perhaps in the future, you can discuss what real estate seminars have influenced your investment life. I would add two people to your list Mark O. Haroldsen and Jay DeCima who have been a large influence on our real estate investment journey for my Wife and I in the last 43 years of investing. Mark does a fine online blog and Jay has a good newsletter “Trade Secrets”. Thanks for a fine message in your thoughts.

    1. Hi Craig! Thank you for adding two more old school teachers to the list. Mark Haroldsen’s book was actually the FIRST real estate book I read. So, thanks for the reminder!

      A post about influential seminars sounds great. Thanks for the idea!

  3. Chad, great list. Just started perusing your site and am really enjoying it. I have a seven figure investment portfolio, but have minimized my income to about $20,000–everything is in IRAs or are in stocks that don’t pay dividends.

    I want to start investing in real estate as well. I could just buy a property or two with cash, but would prefer to lever up the investments. The trick is, despite my high net worth, I get the impression that my low income would make banks hesitant to provide loans. Is there a hack to get around this?

    1. Hey Trey! Thanks for reading through the site and commenting. What if you bought a few properties for cash, seasoned them so that you could demonstrate good cash flow, and then refinance? Then you could repeat several times until you have a portfolio you’re comfortable with?

      1. One follow up question. Would refinancing rates (along the lines you suggest here) usually be a bit higher than if I could secure the mortgage initially?

        1. Good question, Trey. I’m not a mortgage expert because I haven’t refinanced lately. But I think some refinances do have higher rates if they determine it’s a “cash out” refinance. From the bank’s perspective, this means you’re pulling out more than you put into it and that’s more risky in their eyes. I would check with your mortgage lender on this, but I would think if you refinance for at or less than you put into it, the rate would be comparable to a purchase. Lenders always want to make sure you have skin in the game because they see it as less risky when you do.

          1. Thanks, Chad. Much obliged. The other route I might take is to just have my sister cosign. She knows with my assets she’ll never be on the hook. I may even bring her in as an equity partner, but with me still managing the properties. Again, thanks for your take. Looking forward to considering your courses once you put them back out for sale.

            1. Cosigning could be an interesting route. Good luck! Either way a good mortgage lending representative can help you figure out your best options. With your amount of assets, there should be good possibilities. I remember starting in the same boat (little income to show) but I had no assets! So, you’re much better off. Thanks for considering my course. It’ll likely be available again in February or March 2018. Working with the current students right now and it’s going well so far.

  4. They’re all good, but Ron’s jumps out the hardest to me, because I used to listen to him back when I got started and began building a real estate empire with full disregard of what I was hearing. Some people learn the hard way. Time and again I’d here him say “Take care of today’s cash flow needs first before you go out and try to get rich” or “you can’t eat equity” and, in a fuzzy way, rationalize that he was not talking to me. He was.

  5. That’s a great list. Those are mostly long term real estate investors that the REI community know, but not many others. I’m glad to see Mike Cantu and Bruce Norris on there. I don’t hear about them much outside of California. I follow Bruce religiously to make sure I’m only holding property that I want to keep long term (like I did the last time around)

    Mike Cantu had a course 10 years ago and he brought some “Old School” real estate investors on stage and asked them all what they would have done differently. They pretty much all said they would have held on to more property. Of course this was California at the peak in 2006. But holding long term in good areas is a good bet
    David Schumacher’s book “Buy and Hold” (there are several versions of it) talks mainly about holding long term in areas that will have the opportunity to appreciate. I think finding those areas is something that is not often considered.

    1. Thanks for commenting Jeff. Interesting observation made by the experts at Mike’s event. they all would have held more. I haven’t regretted holding either. It’s how true wealth is built. Glad you’re also a fan of Mike Cantu and Bruce Norris. Two smart, awesome guys.

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