Grant Cardone
CEO & Fund Mgr 1.7B AUM
21 Best Selling Books & Biz programs
Creator of 10X Movement, CardoneU
Father & Husband
Text me 1-305-574-9093
cardoneu.com
Follow him at https://www.instagram.com/grantcardone/
First 5 Minutes of Automated Transcript:
00:00
overpriced
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and you can still find deals in that
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market and we will do that on the show
00:05
today
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305-865-86868 i'll i'll prove to you in
00:10
this
00:13
cardone zone today i'll prove to you
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that your market can be overpriced
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and you can still find a great deal okay
00:20
i'm going to open this book up how to
00:22
create wealth investing in real estate
00:24
you can get this book on amazon for 25
00:26
bucks you can also get it my website for
00:28
free if you want it for free rent
00:30
credible.com where it says free books
00:31
free books
00:33
grantcardone.com you want to give jeff
00:34
bezos and his boys
00:37
some more money give it to him if you
00:38
want to if you want to get it for free
00:40
go to grantcardone.com
00:42
free books or you can go to
00:43
cardonecapital.com
00:46
forward slash book book fart slice book
00:49
at cardonecapital.com
00:51
um that's uh
00:53
where we raise money for my real estate
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activities okay in chapter six and
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chapter six your first deal says pay
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attention to this recipe and your first
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deal has a better chance of being a
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winner in any market okay so look i was
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here three years ago three years ago
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talking to you guys about five caps
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okay a five cap just so i back this
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thing off so everybody understands what
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i'm talking about a five cap basically
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means that's your percent of return
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if you pay cash for a deal
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okay so if you paid a hundred grand for
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a deal and it was a five cap it would
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make you five thousand dollars a year
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and you're like
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why why is it five thousand dollars a
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year it must be overpriced okay if it
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was an 80 cap it would pay 8 000 right
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you're never going to find any cap today
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if you find an a cat run
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tells me everything if you have an 8 cap
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7 or 8 cap or 9 cap or a 10 cap that's
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what we used to buy 20 years ago people
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20 years ago that are looking at the
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market today are saying a five cap three
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years ago five cap is overpriced i said
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i said three years ago the cap rate will
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go down
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so when you guys start saying is the
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price of the property too expensive
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let's say it deals a hundred thousand
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dollars or it was let's say 19
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uh
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what what year are we in 20 let's say in
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2018
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this asset was 100 grand and it was a
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five cap okay
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and it paid five thousand dollars if it
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was one million dollars it would pay
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fifty thousand right so if it was one
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million
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just to keep this simple if it was a
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five cap the cap would stay the same but
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the price would change because it's more
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units or whatever okay and this would
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pay this would pay 50 000.
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uh if this deal was 10 million dollars
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okay and it was a five cap it would pay
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500 000.
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five hundred thousand assuming in every
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situation that i paid cash for that
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asset the cap rate
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determines what percentage i get
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if i paid cash for the asset most people
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would not pay cash for the asset
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personally i would not pay cash for an
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asset even though
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last month i paid cash for two assets
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but there's a reason why i paid cash for
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those assets and it has nothing to do
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with this conversation right here today
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i'm just talking to you about is real
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estate too expensive let's say this was
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arizona austin or fort lauderdale in
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2018 you could have bought a hundred
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thousand dollar unit you could have
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bought a million dollar apartment deal
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maybe a couple of four plexes and and uh
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or 10 million dollar uh it was a hundred
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unit deal it cost uh is that right let
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me see what can i buy for 10 million
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yeah about uh you know 10 units or 20
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units whatever the case is and that was
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in arizona philadelphia boston
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austin it doesn't matter the location
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could have been singapore or cindy
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if there was a five cap it was a five
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cap and i said three years ago these cap
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rates will go down at the same time
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people were saying cap rates cannot go
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down it is impossible for them to go
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down and yes sure enough cap rates went
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down what's what's the point of this is
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real estate too expensive was it too
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expensive then only to the people that
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were in the market okay you want to pay
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attention to this
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people in the market rarely change the
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market typically it's a guy coming in to
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