The Rental Trap Defined (LA 1051)
Transcript:
Steven Butala: Steve and Jill here.
Jill DeWit: Good day.
Steven Butala: Welcome to the Land Academy Show, entertaining land investment talk. I'm Steven Jack Butala.
Jill DeWit: And I'm Jill DeWit broadcasting from sunny Southern California.
Steven Butala: Today, Jill and I talk about the rental trap defined.
Jill DeWit: Do you want to give the background on why we're talking about this?
Steven Butala: The question that we should, the daily question is all about somebody who's in the rental trap and trying to get out.
Jill DeWit: That's going to set up the show. Okay. I didn't know that.
Steven Butala: Have you ever paid rent? If you've ever paid too much rent, you know what the rental trap is, but we'll talk all about it in a second and my suggestions on how to get out of it, like tomorrow.
Jill DeWit: Right. And as you can tell, this is all around someone talking about being an investor in our world and posting a question about being in the rental trap in our world.
Steven Butala: Before we get into it though, let's take a question posted by one of our members on the landinvestors.com online community. It's free.
Jill DeWit: And here it is. So Sean asked, "Bottom line is that I can't make great money."
Steven Butala: "The bottom line is that I make great money."
Jill DeWit: Okay, "But I can't afford to buy real estate in the city I work in. I'm stuck in the rental trap and it feels just like that a trap. I started looking to buying land and what it could do for me and I found Land Academy. I'm looking forward to starting on this land buying and selling business as soon as possible."
Steven Butala: Excellent. Again, like I talked about, we're actually filming the back, behind the scenes kind of about this podcast, and earlier Jill and I were talking about this and I said, "This is a perfect Land Academy member."
Jill DeWit: Right.
Steven Butala: They're doing well financially. They're already having some success in their life, regardless of whether it's a great job, or you own another company, but those types of people seem to be the superstars in our group.
Jill DeWit: Exactly.
Steven Butala: They're really familiar with the nuts and bolts of how to run stuff and be successful, and they had what it takes or have what it takes to do something else. And now they're applying all that, their personal style of how to do this with buying and selling real estate and they're just killing it.
Jill DeWit: Well, and they're simply just looking forward. They're not just sitting there working their day job thinking, "Well, I guess this is it." I mean, a lot of people that's what they do. But to be sitting there taking a step back going, "All right, I'm actually doing okay. I need to be doing something else because I'm not getting ahead like I should. There's more."
Steven Butala: Right. So the rental trap, in my opinion, is this the meat of the show?
Jill DeWit: Go for it.
Steven Butala: This is the meat of the show. The rental trap, the technical definition of it is this. When you are renting and the percentage of your rent is, as a percent of your income, is more than 20%. That's actually my recommendation. It should never be more than 20%. So how do you do this if you live in a very expensive city? Well, you have roommates. Or, "Oh, that's great Steve, but I have a family and I have three kids and I can't just go have roommates.