Seth Godin is a great marketer.  His book the Purple Cow is a fun read.  Hey who says business books have to be dry and boring.  Seth’s books certainly aren’t.  It is only 137 pages and a fast read.   But don’t let its small size fool you.  It has a powerful message.

A Purple Cow Is Remarkable

The concept of the book is simple.  If you have seen one cow you have seen them all.  But if you saw a purple cow, well that would be remarkable!  You’d notice a purple cow.  You’d tell your friends about a purple cow.  That is why I Am telling you about the book Purple Cow.  When it comes to marketing books this one is – remarkable.

Seth Godin will guide you through the changes that are happening in the marketplace.  He discusses why the old paradigm of marketing doesn’t work any more.  Seth also describes how the products need to change to be successful today.

Otaku – What you want in your customers

I learned a new work from this book, Otaku.

“Otaku describes something that’s more than a hobby but a little less than an obsession. Otaku is the overwhelming desire that gets someone to drive across town to try the new ramen-noodle shop that a great review”

This is what you want in your customers.  This is why your products have to be remarkable.

Seth Godin Is Fun

One quote from the book I love

“Does the US Postal Service hire Annoying people or just train them that way?”

It is a great example of his irreverence and his unique way of looking at things.  Sadly the US Postal Service never quite looked at their own business that way.

Now I haven’ given anything away that you couldn’t read on the flap of  the cover.  Seth ads value by the humor and the case studies.  So buy this book.  You’ll be glad you did.  I “steak” my reputation on it.  I wouldn’t “steer” wrong.  And that’s no bull!  (Sorry, I’ve got to milk it for all it’s worth)

Buy Purple Cow from Amazon here at a great price.

Happy Reading,

Ned

What Is a 1099?

A 1099 is an informational return required by the IRS.  Employees receive a W-2 to let them know how much income was rep0rted to the IRS.  You may also get a 1099 INT from your bank telling you how much interest you received in the prior year.  In a similar way businesses are required to report how much they pay other business and independent contractors.

Some small businesses are not even aware they are required to supply 1099s.  A typical real estate investor may need to send them to their attorney, contractors, assistants, and Bird dogs they have paid.  I am sure many investors never considered this requirement and were unaware they were risking IRS fines and penalties.

Who Gets a 1099?

You are required to give a 1099 to any Payee to whom you pay at least $600 or more in the year.  This quote is directly from the 1099-MISC instructions

“At least $600 in rents, services (including parts and materials), prizes and awards, other income payments,   .   .   .   or Gross proceeds to an attorney.”

The key words there are “other income payments”.  If the income is taxable to the payee, you should send them a 1099.

There are some exceptions to the requirement.

• Trade or business reporting only.  Report on Form 1099-MISC only when payments are made in the course of your trade or business. Personal payments are not reportable. This does not mean you can skip this just because you didn’t make any money, or do business in your own name. If you intend to make a profit, you need to send them out.
• Generally payments made to a Corporation are not reportable. Keep in mind the IRS instructions specifically say a Corporation, not an LLC or other business entity. Also you must report amounts paid to an attorney even if they are incorporated – I guess the IRS doesn’t trust attorneys either!
• Payments for merchandise, telegrams, telephone, freight,  storage, and similar items are not reportable.  So if you buy plumbing supplies from the local hardware store you do not need to report that.

Extended Due Date for 1099 Forms

The due date for 1099 forms is Jan. 31st 2010, however since Jan 31, is a Sunday you have an extra day this year.  Form 1099s are due to the recipient by Feb. 1, 2010.  Reporting to the IRS is due by Feb. 28, 2010.  However the due date for reporting to attorneys (box 14 10099-misc)  or “Proceeds from real estate transactions” form 1099-s is Feb 16.

How do I file a 1099?

You must send a copy to both the IRS and the Payee.  You can get the instructions on the IRS website, www.irs.gov.  I am unable to find the 2010 instructions but  Here is the link to the 2009 instructions.

You will need their taxpayer identification number.  You get that by giving them a form W-9 Request for Taxpayer Identification Number and Certification. The W-9 instructions are available here.

Have Your Accountant File

Of course I just give the information to my accountant and he takes care of  it.   See this post, why I love my accountant Goodwich, Stoller and Associates. You can go to their site directly at Goodwich Stoller and Associates.

Happy investing,

Ned

This was originally posted in 2009 and has been updated with 2010 information.

Do you have a mastermind group?

I am fortunate to be a member of a high level mastermind group. I am continually impressed with the ideas, knowledge, and success level  the members of my mastermind group generate.  Two members of my group are putting on an exciting event later this month, The Exponential Wealth Conference. The conference will be Two days Friday April 24,  &  Sunday  26, 2009 with multiple  speakers,  and jam packed with info. Click here to see the complete schedule

The man who negotiated with Warren Buffett

I am not just telling you about this because it is put on by my friends but also because I know this will be a great event. I know my friend Pete Gauthier is both an excellent negotiator and great teacher of negotiating because I have heard him speak first hand.  Pete Gauthier sat across from Warren Buffett at the negotiating table  during his stint as as a lead negotiator for the Pilots Union.

All the other speakers; Dan Sprietzer – Business coach extraordinaire, Edwin Kelly – Investing in real estate with your IRA, Tom Zeeb – Automating your business are top notch. I have never heard the featured speaker Richard Flint, but my friend Dan assures me I will be impressed.

Business Foundations, Where Every GREAT Business Starts

I am a big fan of education. There is no better place to invest your money than in yourself. When Dan told me about this event I really wasn’t excited about spending another $2-3,000 for a multi-day event. I love these things and they have really helped me succeed to a high level but hey right now it’s just not in the budget. Then he tells me “It’s only $199.00!” Whoa, Big Change, it’s now only $49 ! ! !

Sign up here

Some of the Topics Covered Will be

• Setting up systems
• Business automation
• Internet marketing
• Negotiating
• Tax free investing
• Much Much More

Sign up here

The Exponential Wealth Conference: How to Make it, How to Grow it, How to Keep it!

Did you see what I said above. It’s now only $49.00!

Do you have an Apple iPod? How do you use it? I try to take a walk every day. It is modest exercise and it relaxes me. I also get some of my best ideas while walking. To help generate those ideas I listen to my iPod.  I listen to motivation, sales, real estate and marketing recordings.

Many of us have a shelf full of programs from all kinds of real estate Gurus. Why not load them onto your iPod and actually listen instead of leaving them on your shelf.  I have also recorded my goals so that I can listen to them daily. You can take this a step further and record a list of your strengths and successes. Motivational speakers regularly talk of our “Self Talk” and how it can help or hinder us depending on whether it is positive or negative. Record a positive self talk tape  and listen daily. This guarantees you a daily dose of positive messages.

What is Nike +

I Use a Nike+ for my iPod.  This is a really cool tool.  It has a little transmitter that goes in your shoe and it sends a signal to a receiver attached to your iPod.  It keeps track of how far and how fast you run.  When you sync your iPod it uploads your info to a Nike website which tracks your mileage.  You can set goals and track by day, week, or month.

While I am out walking, the Nike+ is keeping track of how far, while the iPod give me something positive and motivating  to listen to.

Kudos to Nike for Good Service

Well I had to replace my sensor as the battery had run out. I hooked it all up and it wouldn’t sync properly with the website. I checked the online FAQ – useless.  So I sent a message to customer service.  Most big companies like Nike have bad customer service. They want to rely on their horrible online instructions and FAQs.  Much to my surprise I quickly I got a reply back with an answer that actually worked.  It was a personalized message from someone who actually understood the question! I was very impressed and I think Nike deserves Kudos for providing such good service.

Try it Yourself

If you want to get an iPod or the Nike plus I’ve made it easy for you. Just click the links below. The Nike+ does not work with all iPods. So if you already have an iPod make sure you have the right one before you spend the money for the Nike+ kit. You need to get a Nano (1G, 2G, 3G or 4G) or an iPod Touch 1 G or 2G. To make it easy for you these links will send you to the right page.

Apple iPod nano 8 GB (4th Generation)
Apple iPod touch 8 GB (2nd Generation)
Apple Nike + iPod Sport Kit for iPod

I am a big fan of Warren Buffett.  In fact I wrote about some of Warren Buffett’s quotes earlier. While reading another blog about investing, Invesmint.com, I saw the following video about Warren Buffet buying stocks.

A key quote from the video is:

Today people who hold cash equivalents feel comfortable. They shouldn’t. They have opted for a terrible long term asset, one that pays virtually nothing and is certain to depreciate in value.

Yes if you are smart you have cash on the sidelines. However if you are really smart you have no intention of keeping it there. You should be shopping for value. Whether that value is in the stock market like Mr. Buffett or in real estate.

Another famous quote of Warren’s is also in the video:

A simple rule dictates my buying: Be fearful when others are greedy, and be greedy when others are fearful

Many have cash on the sidelines because they are fearful. However this is the time to get aggressive with your finances. This is the time to “Be Greedy” and take advantage of the low prices.  Of course “Being greedy” does not mean being stupid. You need to know how to find value, and how to assess it.  If you don’t know how to do that you need to get an education and/or work with a professional you can trust.

Contact me and I will help

As a reader of this blog, contact me and I’ll be glad to help and point you in the right direction. No one, not even Warren Buffett, can predict prices short run, but real estate is currently priced very well for long run. If you have money on the sidelines and want to get into real estate, send me a message via the contact us page and I’ll give you some ideas as  to how to go about it.

Happy investing,

Ned

I like this guy already. What great marketing! Do you think he gets noticed and remembered?

Brilliant marketing, however he only did half the job.

I love this, but he could have done even better. While I might remember the image,  I am not likely to remember the name and certainly not the number. A quick search of the internet found a number of copies of this photo. But without a city state or area code how would I find this guy? By the way he’s from Halifax, Nova Scotia.

A Google check of the name finds a number of directory type business sites that list him but no web page for this guy. He could be on the first page of Google if he had a website. This is a wonderful opportunity for vital marketing and cross marketing. Think how many people would link to him to see the picture. Links to a website are a big part of what drives a website to the top of Google searches. (Since he doesn’t have a site to link to, you could link here. I’d sure appreciate it)

How can you learn from this? Can you create something similar and memorable in your business?

Would you do business with this guy? Would  you think of him 1st first when you need a plumber? Or do you think of him as a goofball and would avoid him. Leave a comment and let me know.

Keep Laughing,

Ned

I really admire Warren Buffett. Not just because of his success but because he is truly ethical and has a wonderful philosophy. He is also quite quotable. Below are five of my favorites. Mr Buffett said  these regarding the stock market yet we can apply these same lessons to real estate.

“It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently.”

I am amazed how many crooks there are in real estate. There is plenty of money to be made by being honest and ethical.  I regularly see how treating people right has come back to benefit me in ways I didn’t expect. I also see crooks and charlatans that have no idea how many people avoid them and speak badly of them. They have no idea of how many deals they miss because of their bad reputations.

“Risk comes from not knowing what you’re doing.”

Forget what the late night TV gurus say, real estate is incredibly risky. The great thing about real estate is you can control that risk through knowledge. Unlike stocks, you have much more control in real estate. You have control over how you finance it.  You have control over which tenants you choose & how you manage it. You can upgrade the property. How much control do you have if you own 100 shares of Microsoft? But knowledge is the key. You must know what the risks are and how to assess and limit them.

“We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful.”

With all of the turmoil in the markets many investors are are scared, but now is a terrific time to be buying real estate. I recently formed Arkad Group, LLC with some partners. We are getting ready to buy some apartment complexes. Our timing couldn’t be better. We feel now is an ideal time to by multi families. Money is moving out of the stock market and some investors are afraid of any type paper assets. This should help us raise funds as investors look to the steady cash flow and solid asset base of apartment buildings. Volatile markets mean opportunity.

“Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years” and “Our favorite holding period is forever.”

This is not a universal rule for real estate. Buying to rehab and flip is a legitimate strategy. However many investors got caught with their pants down because they overpaid hoping to do condo conversions. When the market changed and the condo market died they had no plan B. They couldn’t hold the buildings as rentals because they had overpaid based on condo conversions. Markets change, you should consider what happens if you get stuck holding a property because of that change.

“The critical investment factor is determining the intrinsic value of a business and paying a fair or bargain price.”

Warren often speaks of “intrinsic” value. Real estate investors are taught to value properties by “comps” but is what others are willing to pay an indication of the true value of the property? If demand drives prices artificially high like in the last boom, does that make the properties intrinsically more valuable?

In the recent run up of prices I often saw landlords buying properties based on comps. But they were paying prices that would never cash flow. Frankly I couldn’t see why anyone even bought the properties they were using as comps. A few naive investors overpaid and then everyone thinks it’s OK to pay that much.  A good investor should be looking at the true value, not just the prices. Affordability indexes, cash flow analysis, and rental rates vs cost to own are all tools that can be used to asses the intrinsic value of properties.

If you have a favorite quote from Warren Buffett leave a comment and share it with us. If you like the post, please share it with some of the social networking sites like Stumbleupon or Digg.

Happy investing,

Ned

Have you heard of ePerks? They are one of the many new alternatives to the traditional multiple listing services run by Realtors. There are many great new alternatives to consumers to find real estate on the Net. Some of them have much more powerful tools for free than I pay high dollars to get as an agent.

EPerks apparently isn’t one of them. They have a bad reputation spread over the net.  One blogger Vlad Zablotskyy reviewed them on his Go Beyond MLS website. He had numerous agents comment on his post about their experiences with ePerks.  EPerks didn’t like this and have sued Vlad. Their claim – that Mr Zablotskyy made up the negative comments about their company. It’s an absurd claim as there were hundreds of comments both negative and positive.  Many of the positive ones and ones critical of Vlad came from IP addresses apparently related to ePerks.

This is truly a case of bullying. In fact BrokerScience.com posted a recording of Ben Behrouzi the owner of ePerks threatening an employee of a former company. He said “My new goal in life is going to become to ruin your name across this entire East Bay” That sounds like a bully to me. 

It would appear from IP addresses that someone from ePerks that put a false post on Answers.com that Vlad was a child molester. It is scary to think that simply posting an honest opinion on a little known website could have your good reputation trashed in a way that would be very hard to recover from. Sounds more like e-Jerks to me.

Of course, I don’t know if the allegations against ePerks are true, they may not be. I do know that how they have handled this is a public relations nightmare. I never saw any of the negative press against them until they started bullying Vlad. I don’t think much of them now, mainly from their actions, not anything Vlad did.

What happened to freedom of speech? I not only write on my blog, I often comment on other blogs. Is the threat of being sued going to damper blogging and comments? If you want to read more about this, Greg Swan wrote an article about it with lots of links at the Bloodhound Blog.

You can help preserve free speech on the net by donating to Vlad Zablotskyy’s legal aid fund on the bloodhound blog. I did.

PS: Don’t be afraid to comment on my blog, ePerks doesn’t read it. Just click the comments link.

Happy investing,

Ned

Motivational speaker Jim Rohn says “Rich people have large libraries, poor people have large TVs.” Reading is one of the best ways of improving oneself and your real estate knowledge. On the various real estate forums I go to, a common question is “What are the best real estate books?” One of my goals for this blog is to help answer that question.

Perhaps an even better question is “What types of books should I read?” To be successful you need more than just real estate skills and knowledge. As I read questions from new investors, I see they often lack knowledge not only in real estate, but general business, finance, and marketing.

Although I say books, many of the ones below are available as audio programs. I like to shop at Amazon.com. because they list other versions if they are available. You can often choose between a soft cover, hardcover, audio CD, or even a used book. Audio books are great because you can listen to them while driving or on you iPod. To make it easy for you I have linked directly to some of the books mentioned.

Motivational and Success Books

If you want to be and do your best you should be reading this type of book. A true classic in this category is Think and Grow Rich by Napoleon Hill. Another example of this type of book would be Rich Dad, Poor Dad by Robert T. Kiyosaki. In this book Kiyosaki talks about the contrast between his real dad who followed the traditional get a good education, get a good job and work hard all you life routine vs. his best friend’s dad, who taught him about how money works and how to become wealthy. There is a whole series of “Rich Dad” books but the original or The Cash Flow Quadrant would be a great place to start.

Steven Covey’s The 7 Habits of Highly Effective People fits this category also. Books by, Jim Rohn, Brian Tracy, and Zig Ziglar should also all be on your shelves.

Sales and Marketing

Selling is the key to success in any business. Even if you plan to be a buy and hold investor you need selling and marketing skills. You need to market for leads of properties to buy. You need to be able to sell your self to a bank for fianancing. Every business, every person needs selling skills. It is the power of persuasion.

This is a large category and there are plenty of books here. Zig Ziglar, Tom Hopkins, Brian Tracy all have many books on selling. It would be hard to go wrong with anything those guys wrote. These are the guys that I studied when I was in sales. Ogilvy on Advertising by David Ogilvy or Positioning, The Battle for Your Mind by Al Ries and Jack Trout are both classics and outstanding in the marketing arena.

Business and Finance

Real estate is a business and you need business skills in addition to real estate knowledge to continually grow your business. The E-Myth Revisited by Micheal Gerber is very popular but I liked his E-Myth Contractor much better. Since he is talking about contractors it is easier to relate to. It is shorter, easier to read and I think simply does a better job of getting the point across. Another recent read which was quick and fun was Escaping the Self-Employment Trap by Victor Cheng.

There are books for just about any specific skill or aspect of business you want to learn about; hiring, firing, organization, accounting, taxes, the law etc. For example, many real estate investors want to know about LLCs. Do they need one? How do they create one? A good book in this area is Form Your Own Limited Liability Company by Nolo Press

Real Estate Books

OK, you probably want some books that are actually about real estate. Again there are a ton of options and you can choose from general books or books for a specific aspect investing. One of my favorite general books is Investing in Real Estate by Andrew McLean and Gary Eldred. I loved the book and my copy is filled with highlighted passages. I remember the review I read said it wasn’t for beginners. They probably said that because it’s not a “rah, rah, real estate is great” motivational book, but I think it is a great choice when getting started because it is chock full of useful info. It covers a wide variety of investing techniques and info.

Sometimes you don’t want a general book. You need information about a specific topic. A good example here would be, Inspecting a House by Carson Dunlop & Associates LTD.  By the time I read this book I felt pretty confident about doing my own inspections, yet I learned an incredible amount. The book has many diagrams of what to look for, is easy to understand and is well written. As an investor I usually write contracts with NO contingency for inspections. It’s vital for me to know what to look for before I write that contract. A book like this can really help.

Obviously there are many other excellent books on real estate available and I hope to review many of them over time. So stop back regularly and happy reading.

Ned
Image above © Jose Manuel Gelpi Diaz | Dreamstime.com

I bought this book based on a recommendation from Robert Kiyosaki in his Rich Dad’s Cash Flow Quadrant book. In it he calls The Worldly Philosophers one of the most important books he has read and calls it a must read for those who are in business or investors.

The book is about the history of Economics by describing the times, lives and philosophy’s of the great (and some not so great) economists. While I have certainly heard the names of many famous economists, Adam Smith, Marx, John Maynard Keynes etc I never really knew much about their exact philosophies. Thanks to this book I have a better understanding of what they taught. So when I hear the term “Keynesian Economics” I now know they are referring to government tinkering with the economy.

The book is interesting but not what I was expecting. The stories are more about the lives of the economists and how that shaped their theories, rather than a discussion of the theories themselves. If you want a book about the how to nuts and bolts of economics that you can apply in your life and business, this is not it. If you want a book that is interesting, that will challenge you, and will give you a solid background in history and economics this could be just the ticket.

You can buy it from Amazon.com here

Happy reading,

Ned