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INVESTMENT NEWS
Mid-America Association of Real Estate Investors Newsletter

Real Estate Investor Meeting

On February 10th, 2015, at MAREIs Monthly Meeting, Kansas City Single
Family Experts Andrew Syrios, Phillip Syrios and Bill Syrios with Stewarship
Properties will present Why & How to Invest in Buy and Hold.

Buy and Hold Way to Build True Wealth

When lying on his deathbed, John Jacob Astor, the real estate mogul and first
multi-millionaire in American history was asked what he would have done differently. He said he would have bought more!
Holding real estate is greatest method yet discovered for a person of modest
means to become independently wealthy. Indeed, it is the I.D.E.A.L. investment:
I: Income (Cash Flow from Rentals)
D: Depreciation (Tax Write Offs)

February 2015

MEETING

LOCATION
Holiday Inn & Suites
Overland Park West
8787 Reeder Road
Overland Park, KS
Top Floor
Sunset Ballroom
6pm to 9pm
Details at MAREI.org

E: Equity Buildup (As the principle of a mortgage is paid off)

A: Appreciation (In the long run, real estate goes up in value)
L: Leverage (Use the power of OPM, Other Peoples Money)

FREE BONUS!

Discover why buying and holding real state is such a powerful way to grow wealth
as well as the ends and outs of how to get started in buy and hold!

Build Wealth through Buy and Hold

a Preview of Special Reports on
the MAREI Facebook Page:

Tuesdays Meeting is FREE for members and has a cost of $25 at the door or
$15 if you preregister on the calendar of events at MAREI.org.

Direct Link: MAREI.org/FB

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Mission & Strategy

Were inundated with Flip This House type TV shows which interject
enough drama to keep our interest. Hold This House just doesnt cut it
for spell-binding television. So fix and flip has its advantages when it
comes to reality TV but does it hold (pun intended) such advantages
when it comes to reality itself?
Ill admit bias. Our company, Stewardship Properties, built a relative fortune from buy and hold which would have never happened with a fix and
flip strategy. With this bias in mind, lets look at the relative merits of both.
The Benefits of FIX and FLIP
Cash Now: When you get good at fix and flip (and, like any endeavor, it
takes work and experience to excel) you can make 10-30% of the properties original cost. Putting 10-30,000 or even more into your pocket two,
three, or more times a year adds up to a pretty great income and all the
time being your own boss. If you look at this as a game of getting the best
ROI (return on cash investment dollars) flipping can produce a high ROI.
Limited Risk: As recent historical experience has reminded us, real estate does not always go up. Over time real estate follows inflation but if
you are in a down cycle, flipping properties protects you from the downside.
Less Financing Pressure: If you can find a source of cash and you are
successful at flipping, that cash can be re-circulated time and again without the need to look for further cash sources. This allows you to focus on
finding and flipping for the highest returns.
No Property Management: There are no tenants, termites or toilets and
thus no need to find competent property management (no small task) or
to build a competent property management company yourself (no small
task). Management, maintenance and tenant-landlord legal issues can eat
up lots of time, energy and profits if not done well. Even when done well
you can sometimes end up with high turnover costs and unpaid damage
or rent. Again, consistent expert property management is no small feat,
but the only way to reliably extract income from your rental assets.
Focus on Good Deals: Flippers know that margins can be thin and that
any number of soft costs can eat into their profits. This often forces them
to get the best deals possible. So they are always looking for motivated
sellers, negotiating the best possible deal, keeping their hold times to a
minimum in order to maximize their profits and move on to the next flip.
The pressure is on from start to finish and thats a good thing.
Breadth of Market: There are higher-end homes and expensive locations
(e.g. San Francisco or Honolulu) that will never pencil for a buy and hold
strategy but conceivably you can flip any property in any location for a

WHY (& HOW)

YOU SHOULD BUY AND HOLD

R E A L E S TAT E
T U E S DAY F e b 1 0 t h

INTRODUCING

profit. Buy and hold investors who purchase such lower ROI properties may do so because they have plans for a
large value add or because they believe the property/location has a significant upside in appreciation value. But
normally higher end markets are not as conducive to a buy and hold strategy as they are to fix and flip.
The Benefits of BUY and HOLD
Holding properties has produced untold millionaires and billionaires. Real estate investment is flat out the average persons best shot at creating serious wealth. If you flip you can make a profit, if you hold, you can make a
fortune. As such holding real estate is the
I-D-E-A-L investment.
I-ncome: Residual income amounts to positive cash flow on automatic pilot, whether you put time into
hustling for the next deal or lying somewhere on a beach. This is the goal of the buy and hold strategy, to provide
you with a reliable stream of income that is not contingent on working. The challenge is to keep financing properties at 100% (or nearly 100%) and manage them so that the rental income exceeds the expenses. Obviously the
more properties producing positive cash flow in your portfolio, the greater your monthly income becomes. There
are many real estate buy/hold investors who would never have to work another day in their lives if they choose
not to.
D-epreciation: One of the cons of flipping is that it produces taxable income at ordinary rates whereas
holding can allow you to have an income via positive cash flow and yet show a tax loss from depreciation. When
a property is sold, its depreciation must be recaptured and then incur capital gains tax (often at a lower rate than
ordinary income). To avoid any such tax consequence, properties may be sold via a 1031 exchange or better,
yet, kept for a lifetime of wealth creation and passed on to heirs who receive them as if they have not been depreciated at all (at zero tax basis). Federal inheritance tax law allows five million dollars (or five million from each
spouse via a trust) to freely pass on to heirs. (State laws vary.)
Additionally, any time you refinance your properties, the capital you receive is a loan so those funds are not taxable at the time of receiving. Refinancing also can allow for a very high ROI or even an infinite ROI when all down
payment funds are received back in the refinance. Refinance can, in effect, leverage the leverage!
E-quity Build-Up: Unless the mortgage is interest-only, each payment made on the loan cuts down the principal
using rent to pay off the mortgage. Amortization tables are a thing of beauty to a buy and hold investor because
each and every month they get closer to owning their property debt-free. And if they chose to refinance along the
way, well, go back and read the previous paragraph! So, if you have a 120,000 property fully financed at 5.5%
interested over 30 years you would have paid off 9,047 in 5 years and 20,951 in 10 years.
A-ppreciation: If you look back in history, the real estate market has appreciated at a rate similar
to inflation which is calculated at 3.4% over the last 93 years and 2.5% over the last 10 years.
(CLICK HERE.) If we see a 3% appreciation rate going forward, a 120,000 property will be worth
139,113 in five years and 161,270 in ten years. Below is a map that shows appreciation state-bystate since 1975. For more specifics on it, CLICK HERE.
(Continued on page 4)

Just taking equity build-up and appreciation on our hypothetical 120,000 property you have realized a gain of
28,160 in five years and 62,221 in ten years. Yes, the property required management over that period of time
and you had to put in some capital improvements (like a new roof/water heater/exterior paint job/etc.) but you
have also experienced a 6,222 per year gain over a ten year period of time as well.
L-everage: The reason that real estate is the only likely investment option that can make a person of average
means wealthy is because of the last word in I-D-E-A-L: leverage. When you use only a small portion of your
own funds: 25%, 15%, 5% or even less and you finance (use other peoples money) the remainder of your purchase/upgrade, you have put in a relatively small percentage of your own capital (0-25%) and yet realized
100% of the profits and benefits. Those benefits
I-income from positive cash flow,
D-epreciation from tax benefits,
E-quity Build-Up from mortgage pay off,
A-ppreciation over time, combined with the
L-everage of using other peoples money
will substantially multiply your return and, over time, MAKE YOU WEALTHY!
We are buy and hold investors because weve found the way to overcome the challenges and to realize
the benefits on a daily basis.
Question: Why would you EVER sell any property if
1) it cash flows,
2) you dont need the money, and
3) it is well-managed?
Stewardship Properties has two objectives: CREATE WEALTH and OPPORTUNITIES.
To do this we look to form dynamic partnerships, creating win/win situations with our private and bank
lending partners in order to address the challenges of a buy/hold strategy so we can realize its benefits. Please Visit our Website at StewardshipProperties.com

INTRODUCING

Bill Syrios began real estate investing in Portland, Oregon in 1980. Be-tween 1980 and 1986 he bought,
rehabbed and sold four houses. In 1989, Bill moved to Eugene and formed Stewardship Properties with a focus on buying, renovating and managing campus rental properties around the University of Oregon. He found
this niche to be a prime, value-add market that produced high rental income. In 1992 he moved into full-time
real estate investment and now owns 300 houses and apartment units in Oregon.
During the summers of 2005 and 2006 Bill put on an internship for 16 students from the University of Oregon
and Oregon State University who became involved in every aspect of his company: negotiating with sellers,
purchasing properties, overseeing rehab, property management, etc. His intention was to find the very best of
this group to join him as full-time real estate investors and, in 2007, he formed two partnerships that included
five of those students. During 2007-2010 these two partnerships flipped nearly 200 houses, most of which
were short sales and foreclosures in Eugene, Salem and Portland.
In 2009 Bill turned his attention to the Midwest and began purchasing properties there including apartment
complexes in Kansas City and Dallas. In January 2011 his son Andrew, and later in September 2011 his son
Phillip, moved to Kansas City to focus on buying, renovating and man-aging high cash-flow properties with a
buy and hold strategy. The company in Kansas City, Stewardship Investments, currently owns 185 houses,
duplexes and apartment units. He also, has a partner in Dallas, Texas, Greg Whitney. Together they have
purchased and renovated two multi-family complexes in the Dallas area that total 76 units.
Andrew Syrios began working as a real estate investor in 2005. He graduated from the University of
Oregons college of business in 2006 and became a full-time real estate investment partner with Bill and others in 2007. Later, in 2011, he moved to Kansas City and headed up a new operation for Stewardship focused on purchasing, renovating and managing residential properties. He has extensive experience in evaluating properties, negotiating with sellers, overseeing property rehab and working with real estate finance.

Phillip Syrios graduated from the University of Oregons business school in 2010. After a brief stint as
a professional poker player, he joined Andrew in September of 2011 in Kansas City. His focus has been to
oversee property management and build systems to help Stewardships office team run efficiently and effectively.

CONNECT IN PERSON

Office: 7215 Troost, Kansas City, MO

64131
Phone: 816-333-RENT (7368)
Bill: 541-221-4242

CONNECT ONLINE

StewardshipProperties.com
333Rent.com
TheGoodStewards.com
On Facebook & LinkedIn

There has never been a better way yet discovered to become independently wealthy than buying and holding real
estate. But looking at it from the outside can quickly become overwhelming. After all, there are a lot of moving
parts that all have to fit together.
We will break down and fit the many pieces together. Answering questions about the four main areas of buy and
hold such as:
Acquisition:
How to find and purchase real estate at a discount?
What are the differences between looking at a property
to flip and looking at a property to hold?
What different things should I look for in houses and
multifamily?
Rehab:

What options are available for financing buy and hold

How can I get into buy and hold properties for zero or
close to zero down?

How can I make a property cash flow with a private

loan on it?

Where should I look for private money?

Management:

Should I hire a management company or manage myself?

How do I deal with maintenance?

What do I screen for?

What if a tenant doesnt pay? Or destroys the unit? Or

threatens another tenant?
We will answer all of these questions and clear up why buy
and hold is not only the best investment, but also something that is absolutely achievable for novices and pros
alike. If you want to get started in buy and hold or want to
grow your real estate empire even more, please join us on
Saturday February 21ndAt Career Education Systems!

Finance:

How do you budget a rehab project?

Should I hire contractors, employees or do the work
myself?
How do I make sure a project stays on course?

Regular Pricing: $49 for member, plus $20 for guest. $69 for non-member, plus $20 for guest.
Special Price till the 11th: $29 for member, plus $10 for guest. $49 for non-member, plus $20 for guest
Add $99 for Annual Membership for 1 or $149 for Annual Membership for two.

Total: _______________

Name: _____________________________

Second Person Name: ________________________________

Email: _____________________________

Second Person Email: _________________________________

Phone: _____________________________

Secondary Phone: ____________________________________

Address: __________________________________________________________________________________
Paid by Check: #__________

Paid by Credit Card: #_____________________________________________

Expire Date: __________ Security Code: ______________

Signature: _______________________________ Or register Online at MAREI.org or Phone at 913-815-01114

Saturday Feb 21st 8:30 to 4:30, Lunch Included, Career Education Systems, Top Floor Ward Pkwy, 8600 Ward Parkway, Kansas City MO

BUSINESS
directory
Service

Company

Contact

Phone

Web

Auction Company

Cates Auction

Staff

816-781-1134

CatesAuction.com

Contractor

Building Trades

Robert Massey

816-868-1817

Contractor

Discover Heating & Air

Curt Whitlock

816-500-2970

Discover HVAC.net

Contractor Supply

Home Depot

Sharon Beck

913-313-8912

HomeDepot.com

Contractor Supply

Odor Universe

Mike Riddle

816-718-9136

OdorUniverse.com

Contractor Supply

Sherwin Williams

Mike Steiner

816-589-8506

SherwinWilliams.com

Hard Money

Great Plains Funding

George Hersch

913-735-6605

GreatPlainsFunding.com

Hard Money

Investor Choice Funding

Dave Williams

303-500-7088

InvestorsChoiceFunding.com

Hard Money

Kansas City Investor Funding

JJ Pawlowski

816-916-4593

KCInvestorFunding.com

Hard Money

Longhorn Investments

Mike Friedl

913-634-6386

LonghornInvestments.com

Home Buyer

kcmoHomeBuyer

Don Tucker

816-200-2198

kcmoHomeBuyer.com

Insurance

Asset Protection Insurance

Lisa Goodner

877-752-2742

APIAProtects.com

Investor

3B Real Estate Investments

Bob Hult

913-940-0992

3BREI.com

Mortgage

Pulaski Bank

Beth Langston

816-234-8660

PulaskiBank.com

Realty

Realty Resource

Staff

816-523-4400

RealtyResourceKC.com

Realty & Management

Arrow Realty

Candace Davis

913-956-5003

ArrowRealtyKC.com

Realty & Management

Executive Asset Realty Group

Jim Goodwin

816-866-1159

ExecutiveAssetRealty.com

Realty & Management

Home Rental Services

Kandy Meehan

913-469-6633

Home4Rent.com

Realty & Management

Jamieson Home Team

Kevin Jamieson

913-384-8331

JaimesonHomeTeam.com

Security

COPR Security

Geoff Miles

816-398-4045

COPRcage.com

Title & Escrow

Accurate Title

David Green

913-338-0100

AccurateTitleCo.com

Title & Escrow

Alpha Title

Patsy Archer

913-498-8999

AlphaTitleLLC.net

Title & Escrow

Continental Title

Sharon Bower

913-744-7011

CTitle.com

See full details on all Business Associates at MAREI.org/Business-Directory/

Mid-America Association of Real Estate Investors does not render legal, tax, economic or investment advice. All programs, properties and services are provided with the understanding that Association is not engaged in rendering legal, tax,
or other professional services. If legal, tax or other expert assistance is required, the services of a competent professional
should be sought. Everyone should complete their own due diligence!

Next Month: Wholesaling Houses

With Vena Jones Cox

A Trade Association for

Real Estate Professionals

Member
Discounts

For landlords, wholesalers, rehabbers, note sellers, multifamily investors,

exchangers or anyone else who use real estate as a way to build
wealth. We welcome full time investors as well as those just getting started or people who provide a product or service to the industry.

Home Depot 2% Rebate

Sherwin Williams Discount Card
Office Depot Max Discount Card
Rentals.com 20% Off Reg Price
ISC Tenant Screening
More . . . .

With something for everyone from beginner to pro!

The experienced real estate professional will find the support they need stay informed of the issues and tools to take action. The new investor will find the education they need to get started and the products, services and connections to build
profitable businesses. The product or service provider that caters to the real estate industry will find active professionals who need their services. And everyone
benefits from our community, from live meetings and events to our very vibrant
social media destinations. Please join us . . . .

Contact Us
Learn more about
Mid-America Association
of Real Estate Investors

Meeting Location

Chapter of National REIA

MAREI Meets every 2nd Tuesday at the Holiday Inn & Suites at 8787 Reeder
Road in Overland Park, KS. Conveniently located just off 69 & I35 Highways
at 87th Street.

Kansas City Office

8014 State Line Rd,
Suite 210
Leawood, KS 66208

Meeting Agenda
6:00 pm: Networking & Vendors
6:00 pm: Announcements & Introductions
7:30 pm: Why (& how) You Should Buy & Hold with Stewardship Properties
9:30 pm: Late Night Networking in the Lounge
February Meeting on 8th Floor in Sunset Ballroom

(913) 815-0111
info@MAREI.org
Visit us on the web at
www.MAREI.org