Bakersfield Investment Club
Disclaimer: BIC is not in the business of providing paid financial, legal, or tax advice. Please consult a licensed professional when making investment decisions like a financial planner, real estate agent, IRA custodian, or a wealth management company. BIC is not acting as a real estate agent or broker, or offering to sell properties to investors. All the figures above for interest, instant equity, cash flow and appreciation are based on company financial spreadsheets for 2013. It's also important to mention that appreciation in Bakersfield is not likely to be 29% in future years. Most likely it will decrease about 6% per year until the next bubble we estimate to be in mid 2017. The formula for instant equity is market value minus sales price at the time of purchase. Appreciation is the amount your real estate increases each year after you purchase the property. This amount is based on doing an appraisal at the end of each year. Cash flow is the net yearly income for the property divided by the total amount of cash necessary to purchase the property. Typical cash flow for houses with a mortgage is 17% and cash only returns are 11%. Since we started in December of 2012 we've made a lot of improvements. Now almost every property we buy has instant equity. We're also getting large enough to do wholesale transactions and larger projects e.g. building 4-plexes. Plus we've found ways of increasing the cash flow from each property from the typical $1,150 rent to $1,750 per month for a three bedroom house. Vacancy rates are at 4% and should even get smaller with our waiting list. We're estimating overall returns to members to be about 30% in 2014, 27% in 2015, and 24% in 2016 if we don't make any changes. We don't expect returns to drop below 21% because notes are consistently paying 23.9% averaged over the last two years and their default rates only changed by 1% in 2006 to 2008. If these returns seem unrealistic, please keep in mind that the profit margin in a healthy company is normally between 25% and 35%. The only difference is that we're sharing that profit with you instead of eating it up with operating expenses. High returns are an indication of financial strength. We also pay out all income in the form of qualified dividends, which are normally taxed at 15% instead of 30% to 50% like regular income. We are even setup to receive funds from retirement accounts like 401k's, IRA's, Deferred Compensation, Pensions, TSA's, etc. Our company is very transparent and also carries plenty of insurance to protect you from the unexpected. There are no penalties for cashing out early, funds are normally 100% liquid, and you can either receive a monthly check or allow your income to compound. Originally we wanted to help our family to invest wisely and buy properties together, and it grew into so much more. We really are here to help you not only make money without all the hassle of dealing with tenants and toilets, but also by preventing you from making learning mistakes on your first three to five houses e.g. overpaying, underestimating costs, etc. We're here to make you money, not take your money.
Law Offices of Dixon Kummer
Dixon G. Kummer
Bakersfield Investment Club is happy to recommend the following licensed professionals.
Dennis Valdez, CPA
Bakersfield Real Estate Investor's Brokerage
Greg Lane, Real Estate Broker
Bakersfield Investment Club Partners