To become a successful real estate investor you need to talk to and learn from Chuck.
Not Charles Schwab, whose investment brokerage firm holds the now famous tagline, but Charles "Chuck" Langlois.
A retired master sergeant in the U.S. Air Force, Chuck's second career as a real estate broker led him to great success as a broker and real estate investor. His small investments in rental property afforded him his greatest source of income during his second retirement. As we sat for lunch at The Ritz in Newport Beach, we discuss his life and how an everyday person can also be a successful real estate investor.
A gregarious personality, Chuck was greeted by name as he entered the restaurant. Everyone from the busboy to the general manager hurried over to welcome him and share kind conversation. Having known Chuck for several years, I learned early that this was not a rare occurrence for him.
"Real estate is a people business," Chuck, who genuinely liked people, would say.
But Chuck also liked a deal. While home for 6 months on leave from his station in Thailand, he purchased a home for $29,900 in the summer of 1970. Six months later, an agent with a local real estate brokerage was selling the same model down the street for $34,000. This peaked Chuck's interest in real estate.
With retirement looming and a nudge from wife Loretta, Chuck attended a real estate seminar hosted in a large ballroom for thousands eager to learn about real estate. It was the summer of 1971. In less than a year, Charles was licensed and working in real estate. He started with a boutique brokerage and sold his first property in four days.
"I got hot in a hurry," is how he put it."
In the first years of his career, Chuck helped open several real estate offices, managed a large team of agents and all while selling real estate full time.
Chuck made his first investment purchase in 1975. Using VA financing and having the 6 percent in costs picked up by the builder, he closed escrow on a small home in the Lake Forest area. When asked when is the right time buy an investment property, Chuck responded with a smile and without hesitation; "When you think its going up."
But Chuck saw real estate as a long term investment. His first purchase shows the power of real estate: leverage. The ability to use other people's money, at a fixed rate and over a long period of time is a powerful advantage real estate holds over other investments. Chuck used 100 percent financing to secure a property that broke-even. This means that all the costs associated with the property, including taxes, insurance and the mortgage payment, was paid by the monthly rent.
In fact, every property Chuck purchased broke-even. Chuck understood that the property could not only go up in value, but more importantly, it was paying itself down. And in the future he would have a paid-for home paying him market rents.
But Chuck was quick to point out that repairs, vacancies and other costs can "eat you alive."
Chuck tried to minimize the turnover in his rentals. One of Chuck's tenants was faithful for over 20 years. "Paid on time … every month. And nothing but the most minor repairs." But when the tenant finally gave notice, the time-capsule that was Chuck's rental property required a $30,000 overhaul; roughly $125 for every month rented.
A rental property exists to provide you with a return on the money invested. A successful landlord must figure out the expected average return by using conservative rental figures and factoring in all costs ahead of time. Also, fair dealings with your tenant, even having slightly under-market rent, will keep a tenant in place.
Chuck dispensed his hard earned knowledge freely and unreservedly. I had the great pleasure of many other visits and long conversations on real estate while enjoying Chuck's favorite, nothing less than an 18-year Glenlivet Scotch whiskey. I hope to share more of our conversations with you. He was a wonderful father, grandfather, and to me, a grandfather-in-law. Chuck passed away on Monday, July 25, 2011. He was 77 years old.
****
Chuck's Investment Tip #17:
Know Your Tax
Rental property owners can realize significant tax savings from depreciating improvements made to their property. A common mistake for property owners is to not depreciate their rental property. And since the IRS will assume that you did depreciate and tax you when you sell the asset. Owners should seek competent tax advice from a professional and work to maximize their available deductions.
Chuck's Investment Tip #27:
Don't Sell in a Down Market
During a difficult period in the mid '80s, Chuck suffered a heart attack. Unable to work while he recovered, Chuck needed income. His rental properties had equity, but most were still just breaking even. The tough decision to sell in a slow real estate market loomed. Chuck decided to rent out his primary residence, an estate home located in a prestigious area of Irvine, and move his family into a two-bedroom apartment. Soon after, the real estate market boomed, Chuck recovered and moved back home indefinitely.
Not Charles Schwab, whose investment brokerage firm holds the now famous tagline, but Charles "Chuck" Langlois.
A retired master sergeant in the U.S. Air Force, Chuck's second career as a real estate broker led him to great success as a broker and real estate investor. His small investments in rental property afforded him his greatest source of income during his second retirement. As we sat for lunch at The Ritz in Newport Beach, we discuss his life and how an everyday person can also be a successful real estate investor.
A gregarious personality, Chuck was greeted by name as he entered the restaurant. Everyone from the busboy to the general manager hurried over to welcome him and share kind conversation. Having known Chuck for several years, I learned early that this was not a rare occurrence for him.
"Real estate is a people business," Chuck, who genuinely liked people, would say.
But Chuck also liked a deal. While home for 6 months on leave from his station in Thailand, he purchased a home for $29,900 in the summer of 1970. Six months later, an agent with a local real estate brokerage was selling the same model down the street for $34,000. This peaked Chuck's interest in real estate.
With retirement looming and a nudge from wife Loretta, Chuck attended a real estate seminar hosted in a large ballroom for thousands eager to learn about real estate. It was the summer of 1971. In less than a year, Charles was licensed and working in real estate. He started with a boutique brokerage and sold his first property in four days.
"I got hot in a hurry," is how he put it."
In the first years of his career, Chuck helped open several real estate offices, managed a large team of agents and all while selling real estate full time.
Chuck made his first investment purchase in 1975. Using VA financing and having the 6 percent in costs picked up by the builder, he closed escrow on a small home in the Lake Forest area. When asked when is the right time buy an investment property, Chuck responded with a smile and without hesitation; "When you think its going up."
But Chuck saw real estate as a long term investment. His first purchase shows the power of real estate: leverage. The ability to use other people's money, at a fixed rate and over a long period of time is a powerful advantage real estate holds over other investments. Chuck used 100 percent financing to secure a property that broke-even. This means that all the costs associated with the property, including taxes, insurance and the mortgage payment, was paid by the monthly rent.
In fact, every property Chuck purchased broke-even. Chuck understood that the property could not only go up in value, but more importantly, it was paying itself down. And in the future he would have a paid-for home paying him market rents.
But Chuck was quick to point out that repairs, vacancies and other costs can "eat you alive."
Chuck tried to minimize the turnover in his rentals. One of Chuck's tenants was faithful for over 20 years. "Paid on time … every month. And nothing but the most minor repairs." But when the tenant finally gave notice, the time-capsule that was Chuck's rental property required a $30,000 overhaul; roughly $125 for every month rented.
A rental property exists to provide you with a return on the money invested. A successful landlord must figure out the expected average return by using conservative rental figures and factoring in all costs ahead of time. Also, fair dealings with your tenant, even having slightly under-market rent, will keep a tenant in place.
Chuck dispensed his hard earned knowledge freely and unreservedly. I had the great pleasure of many other visits and long conversations on real estate while enjoying Chuck's favorite, nothing less than an 18-year Glenlivet Scotch whiskey. I hope to share more of our conversations with you. He was a wonderful father, grandfather, and to me, a grandfather-in-law. Chuck passed away on Monday, July 25, 2011. He was 77 years old.
****
Chuck's Investment Tip #17:
Know Your Tax
Rental property owners can realize significant tax savings from depreciating improvements made to their property. A common mistake for property owners is to not depreciate their rental property. And since the IRS will assume that you did depreciate and tax you when you sell the asset. Owners should seek competent tax advice from a professional and work to maximize their available deductions.
Chuck's Investment Tip #27:
Don't Sell in a Down Market
During a difficult period in the mid '80s, Chuck suffered a heart attack. Unable to work while he recovered, Chuck needed income. His rental properties had equity, but most were still just breaking even. The tough decision to sell in a slow real estate market loomed. Chuck decided to rent out his primary residence, an estate home located in a prestigious area of Irvine, and move his family into a two-bedroom apartment. Soon after, the real estate market boomed, Chuck recovered and moved back home indefinitely.