Category: Jewels of Wisdom Newsletter

How to Earn 12% on Your Cash

Here at Diamond Equity we buy, fix & sell a high volume of deals across the U.S. Many are funded by my multiple $10M lines of credit, our own cash, and also by investors like you who read my emails.

Here’s How it Works:

You loan the full amount needed for us to buy & renovate the house.

You get 1st position mortgage securing your money against the property.

You earn 2 points origination & 10% annual interest for the duration of time we have the money working. This results in 12% return for the year if we had your cash for the entire year.  Many deals run just 4-6 months, so your annualized rate of return is actually higher than 12%

If you have cash now, and want me to add you to my short list of lenders (you receive a text message from me directly as loans fitting your budget are available), please reply to this email with your cell phone number.

If you’d like more info on how this works, sign up to receive future loan opportunities at www.FundRehabDeals.com

Hope your Sunday is as beautiful as mine!!

Sit Still & Be Quiet – A most effective Deal Making Strategy

One of my daily strategies for successful deal making is to simply close my eyes in the morning, be quiet, & sit still. You probably know this as meditation.

For the past 15 years, I’ve had a nearly daily habit of meditating each morning for anywhere from 3-30 mins. The time isn’t important to me anymore. 3 mins is just as good as 22 mins. (I used to set a timer for 20 mins and try to make it to the end. That actually was a bit stressful)

On days where I remember the mediation I notice an increase in effectiveness, better decisions, and a more calm approach to life.

I credit this meditation habit for my ability to remember tiny, specific details of any one of the 190 deals we have working at any given time.

Science shows that people who meditate have more gray matter in their brains and more brain activity on brain scans. Perhaps a mental edge can be gained through mediation?

How do you Meditate?
I meditate by closing my eyes, sitting straight up in a chair with my legs uncrossed and feet on the floor. I am not flexible enough to sit on the floor like a monk..  Then I focus on my breath.

I’m not trying to “think” of anything, but if any thoughts come up, I try to refocus on my breath and not react to those thoughts.

I actually say a prayer before the practice each day, and as I sit calmly, I sometimes visualize certain events of the coming day. I intend to see the best way to approach those events during the meditation.

How would those events unfold if I got lucky? Is there anything I need to do or say to create that outcome? Any preparation I should do when my meditation is done?

Over the years I’ve seen countless good outcomes during that 3-30 min morning meditation. Many of those good outcomes then came to pass in real life-sometimes because of the ideas received during that meditation.

While it’s probably not what you expected from the subject line, this is the unfiltered truth one aspect of Deal Making I’d guess almost no one has ever talked about.

A few billionaires who share this habit include Ray Dalio & Brad Jacobs. Not to mention Einstein. If it was effective for those guys, surely I couild  improve my results a little by modeling them, right??

Happy 4th of July, fellow Real Estate Pro!
Normally I send on Sunday, but these facts I discovered today would be stale by then:

Here, you can: 

• Buy Deals Here (33 Avail around the US)
• Invest in Our Deals Here (Accredited Investors)

Featured Deal: Turn Key, Renovated Chicago 6 Flat $549,000 (Kyle 815-370-1160)

The Wrong Day?: The Continental Congress actually voted to declare independence from Great Britain on July 2, 1776. John Adams was so fiercely convinced that July 2nd was the true Independence Day that he routinely turned down invitations to 4th of July events and sent angry letters to people celebrating the wrong date.
The Wrong Month?: Contrary to popular belief, the 56 delegates did not all sign the Declaration on July 4th. Only two men, John Hancock (as President of the Congress) and Secretary Charles Thomson, actually signed it on that date. The rest of the delegates signed it on August 2, 1776.
July 4th Presidential Deaths: Three U.S. presidents died on July 4th. Both John Adams and Thomas Jefferson died within hours of each other on July 4, 1826… Exactly 50 years after July 4, 1776. Five years later, in 1831, President James Monroe also died on July 4th.
We ALMOST didn’t have slavery: Thomas Jefferson’s original draft of the Declaration of Independence contained a fiery paragraph condemning King George III for the slave trade and the institution of slavery. Delegates from Georgia and South Carolina demanded it be completely deleted so the document could pass a vote without offending states dependent on slave labor.
Mock Funerals: During the summer of 1776, American colonists in some cities celebrated independence by holding literal mock funerals for King George III. They would stage a burial of the Crown’s rule over the colonies to signify the birth of the new republic.

Now you have some cool stories to tell at your BBQ, while watching other countries play soccer to entertain you on your special day!!

Today is a quick reminder on one aspect of building & maintaining wealth. At any given time you are either growing or shrinking. There is no such thing as standing still, holding your position.

Be diligent to know the condition of your flocks,
And pay attention to your herds;
For riches are not forever,
Nor does a crown endure to all generations. – Proverbs 27:23

Don’t become complacent. Watch the details of your business. All of them. Intently. This attention makes it grow.

Miss the details, become complacent and it will shrink.

I’m off to buy a house!!

Here, you can: 

• Buy Deals Here (39 Avail around the US)
• Invest in Our Deals Here (Accredited Investors)

Featured Deal: 35,794 Sq. Ft. Warehouse – Barnesville, GA $795K ($22/ft.)

Could you Run 6-10 Deals at any Given Time?

If you are already doing this, congratulations. You can simply delete this email, buy one of these as your next deal, and carry on with your week.

If you are not already doing this, let me share what this looks like.

Running 5-10 deals at once means you are closing 1-2 deals every month. Steady, above average income.

Running 5-10 deals at once is also a lot of work. You are managing dozens of negotiations at any time with sellers in search of that next deal.

You are managing dozens of negotiations with contractors around design, repair items, and inspection reports. You have a strong rolodex of these service providers and are good at underwriting the risk of hiring a new contractor.  (Will they run off leaving a job half finished?)

You are a master at managing the contract cycle – both on the buy-side with sellers and the sell-side when you’re exiting to the retail buyer. You are aware that you have the ability to compress those cycles by a few days here and there-which amplifies your yearly income.

You have resources lined up such as $10M in financing at any given time which is used to buy/renovate that constant flow of deals.  Ok, $5M is prob enough to manage this pipeline.

To be honest, this is how Acquisition Managers are living their life with us here at Diamond Equity Investments. Running 5-10 deals at any given time. 1-2 closings every month.

We have the money, a decent rolodex of contractors, and a steady supply of sellers who own houses that need renovation. We also have strong admin staff to help get closings done. Finally, we have a senior underwriting team to help make the most important decision in any real estate deal:

How much do you offer?? (this is the #1 question most investors get wrong which leads them to big losses, or no deals. I have answered this question correctly alongside my team more than 5,000 times in my career. I can help you answer this too, assuming you’re on the team.)

At this point in this email, I hope you’re actually wondering the same thing:

“Dan, How much do you offer Acquisition Managers who run your deals?”

My answer, “A partnership share on any deal closed.”

There is no cap in the ability to earn income here at Diamond Equity. We are looking for one Acquisition Manager who understands Deal Making & is ready for a lifestyle in the real estate business.

This is a grind, not a “lifestyle real estate business” where you work remotely and go on lots of vacations. The goal is for you to earn $1M after taxes, in the bank, after a few years in the position and then become a private lender-loaning that $1M out at 12% and setting yourself up with an income stream for life. This will take hustle, grit, & determination to be considered & succeed.

At this point in this email, I’ll ask you, “Do you know anyone who might make a good acquisition manager?”  If so, I’d appreciate an email introduction.

We are always buying value add residential, commercial, & industrial property. Happy to review any deal you might have available.

Here is my observation on the residential real estate market across the US:

Buyers seek perfection. Dated, “needs some repairs” handyman specials are increasingly selling only to investors at cash prices.

For the past 5 years since Covid, retail buyers would accept houses that needed some work.  Not anymore. At minimum, the house must be painted & clean. Ideally new appliances. Better yet-fully renovated.

In a flat or declining market, which we is the case in the majority of local markets, renovated houses hold their value. People pay for convenience, ad it is mighty convenient to move into a fully renovated house, unpack, and just live.

Ready to Renovate another house?  Here are 34 properties for sale, many work for fix & flip 

Here, you can: 

• Buy Deals Here (3 Avail around the US)
• Invest in Our Deals Here (Accredited Investors)

Featured Deal: 35,794 Sq. Ft. Warehouse – Barnesville, GA $795K ($22/ft.)

The Five Tax Deferral Strategies

1. Self-Directed IRAs & Solo 401(k)s – These are retirement accounts you control. You can use them to buy real estate—rental properties, syndications, even lend on flip deals—so your gains compound tax-free (or tax-deferred). The rules are strict, but the payoff is real. If you haven’t explored investing from these accounts, start sooner rather than later. Every year you wait is another tax bill paid unnecessarily. Full detail here.

2. 1031 Exchanges – This IRS code lets you sell an investment property and roll those proceeds into another without paying capital gains tax—if you follow the rules to the letter. Used right, it’s a way to grow your portfolio exponentially, without the drag of taxes at each step. Full detail here

3. Opportunity Zones – Investing in designated areas can mean years (sometimes a decade or more) of deferred or eliminated capital gains tax. While the windows are changing year-to-year, there still are possibilities if you know where to look and act quickly.

4. Deferred Sales Trust – Can be used to defer gain on any highly appreciated asset – including the sale of a business. Full detail here.

5. Cost Segregation – One of my favorite & most used tax deferral strategies. In certain deals, this can be like writing off a portion, or the entire investment amount.  Full detail here.

Here are 32 properties for sale, many work for fix & flip 

A Worthy Goal for Anyone

Many years ago, maybe 2012, I met one of our Private Lenders for lunch. At the time she was about 40 years old and had recently retired. She told me a story of how her dad was amused by her goal:

Save $1 Million in the bank after paying the taxes, then retire on the income that $1 Million would generate.

No rental properties, no flipping houses. She worked a professional career and invested her money passively in real estate deals earning 12%.

As she shared the story, sitting across from me-retired-she then shared how her dad was amazed when she did exactly what she said she would.

What’s the Income on $1 Million in Savings?

The deals paid roughly 12% per year – or $120,000 in income – by funding fix & flip deals for investors.  For less experienced flippers (more risky loan) she charged 15%. For well capitalized, volume flippers, maybe as low as 10%.

For a full breakdown on how funding fix & flip deals for investors works, you can sign up here & I’ll email you a complete summary on how my lenders fund deals and are protected by 1st position mortgage & note.

As I sat across from her broke, I thought, Why Not Me?

If you’re been a reader for a while, or know me personally, you know that 2012 was the year I quit drinking. I’ve accumulated a few bucks since those days, but when she told me the goal of accumulating $1 million dollars to lend to other investors, it seemed like a great idea (except for the retire part-I’m having way too much fun to stop & do nothing!!)

For one group of folks reading this email, $1M in cash is laughable-as they’ve hit that & many more – years ago. For the rest reading this, you’d prob agree that $1 million in cash is a worthy. Well, certainly it’s a start!

Here are 32 properties for sale, many work for fix & flip 

Lesson from Today’s Hunt

We have a pool in our backyard and two ducks often hang out here. We also have a pool fence to keep out small children.

Today, before writing this email, I woke up and let Charlie, my English springer, into the backyard as usual. By nature, he is a hunting breed. Ducks especially.

As I followed him out I noticed the confrontation – he was chasing and attacking one of the two ducks who made the error of being on the wrong side of the pool fence.

So it began, me chasing Charlie, Charlie chasing the ducks. Each time I separated Charlie from the duck I hoped the duck would fly away.

Instead, the duck tried to lunge and fly toward the water, bouncing off of the pool fence with each attempt-and right back into the danger zone of the dog.

Luckily for the now-injured duck, Charlie did listen to my command to go back inside.

Charlie watched from inside as I guided the now-flightless duck and it’s mate out of our backyard on foot. Both ducks survived the encounter.

The Lesson – What Always Worked, May be the Thing that Bankrupts You

The first instinct of both ducks when Charlie ran outside was to try and get to the water. Safety would have been better sought by simply taking flight and getting above the danger.

As I reflected on this error in judgement, I realize that the ducks likely jump off into water all the time to avoid the occasional coyote or rattle snake (both live in the area near my home). That was the thing they’ve prob done 100 times to easy success (survival), but almost cost them their life.

But the Bankruptcy?? Let me explain

Right now many large apartment owners are teetering on bankruptcy, praying for interest rates to drop back to maybe 4% so all of the deals they’re currently stuck in will be able to refinance.

It was this one action, repeated 100 times with success, which placed these operators in their current difficult situation:

Buy a building, raise rents, refinance and pull out as much cash as possible to buy the next building. Repeat. Same strategy for BRRR investors.

The same thing that made them rich may actually make them poor. Or certainly a lot less rich.

Office building owners have experienced the same thing. And many other asset classes over the years.

In 2008, when values collapsed, it was the 10-100 house single family rental operator who faced the large evaporation of their wealth. Along with many developers.

What About House Flippers? & Brokers? What is the action You’ve Done with Success 100 times that might Bankrupt YOU?

It might be how you’re using the MLS to evaluate your After Repair Value & analyze the market.

For the past 15 years, we’ve enjoyed a mostly stable and increasing real estate market. This type of market will forgive mistakes around inaccurate forecasting of the finished value, the resale price, of your fix & flip deal.

If you think a house is worth $200K, and you’re wrong and it’s only worth $180K or $190K on the day of purchase, you might be saved in an increasing market. If that market increases at 5% per year, it might actually be worth $200K by the time your renovation is done.

In a declining market by 5% per year, the opposite can occur. You think the house is worth $200K and it’s only worth $180K or $190K on the day of purchase. Going the opposite direction, that house might be worth $180K or $170K by the time it’s complete.

Be aware the the way you analyze a market MUST change if your market changes.

How to Beat the Market

If you’re flipping houses, the 5% change in price is not a major factor for two reasons:

1. Superior Product – If you’ve done a nice job, buyers will pay more for a better product. Renovated houses usually hold their value long enough for you to exit before downward trends affect pricing. If your product is not superior, and you’ve done a marginal job on the reno, you might get hurt.
2. Speed of Sale – Get in & out of every renovation as fast as possible. If you can enter & exit a flip in 6 months or less, the risk of a downward trend in the market is greatly reduced.

In conclusion, what is that one thing you’ve done over & over, and it’s worked, that might stop working?  Being aware of this, looking for this, might help you spot the market change in advance and allow you to manuever your business to remain successful. Lest we need to take a moment of silence to honor & remember past success….

A good book worth reading on this subject is Who Moved My Cheese?

Here are 32 properties for sale, many work for fix & flip 

What is the #1 Requirement of a Deal?

Most people probably jump to price. I know I certainly did for the first 10 years of my career. However, here is the absolutely, most important requirement for any Deal:

The Deal MUST Go to Closing

I have a friend who bought a apartment complex for something like $70M just before Covid. They accepted a contract for $150M in 2022 right as rates were jumping. Imagine, almost $75M in just 2-3 years. Best Deal Possible?

Because the buyer’s interest rates doubled right before closing, they  renegotiated and could close at $110M, which my friend boldly denied believing better offers would appear. Those offers never materialized, and he’d sell you the property at break even today if you are willing to buy it. The deal never went to closing, making the price completely irrelevant.

Always Underwrite Any Offer for Certainty of Closing 

My first question when considering an offer on the table: Will this buyer actually close on this offer? Or will they renegotiate they day before closing? or simply cancel?

If the buyer fails, will the market be as good as it is right now? That is NOT always guaranteed. In residential real estate, the Spring & early Summer markets net 5-10% more price than any other time of year. You may only have one shot to get that right, or wait one more year and try again.

In commercial real estate the market cycles measure in decades. Retail real estate is doing well at the moment, but was soft from 2010-2021 or so. Office is currently soft. Apartments are in decline-as rents are flat, or declining throughout the country.

How to Beat the Market

1. Don’t Be Greedy – Trying to set a record and extract every last dollar from the market can often be a trap. I’m sure you would agree with my buddy who denied that $110M renegotiation-$35M or so in profit would have been WAY better than the situation he is currently working himself out of – and it’s been a tough 5 years since this occurred.
2. Go FAST!! When it’s time to sell a property, I opt for speed where possible. There is a balance to this-I’m not suggesting simply fire selling.  I prefer getting to closing quickly rather than risking market changes occurring which kills my current deal. Remember how many deals cancelled when Covid hit? Or maybe in 2008 when the banks collapsed?

If you have a deal which needs a certain, quick, guaranteed sale, I’m happy to be that buyer. I buy value add residential & commercial real estate. We require the ability to push the value and create a profit by capital improvement and/or raising rents. Reply to this email if you have something like this.

Here are 35 properties for sale, many work for fix & flip