Wealth Creation and Preservation …
… can be accomplished at the same time
but we’re not telling you anything you haven’t already experienced
The consumer price index is kept artificially low …since 1991 between 1.6 percent and 3.3 %
… the real Inflation rates have been closer 5% and 6% and some estimate it’s even higher
Bear Sterns 29 BillionBank of America 97 Billion
Automobile Industry 97 BillionAIG 112 BillionGE 139 Billion
Citi Bank 235 BillionHome Owners 300 Billion
Fanny and Freddy 400 BillionIraq War 507 Billion
TARP 700 BillionStimulus 787 Billion
Total Up To Now: 4 Trillion
New Spending Commitments: 7.8 TrillionTotal Committed Spending: 12 Trillion
60 Trillion Dollars of Unfunded Obligations to Social Security Medicare and Medicaid
The only way out of this situation is inflation with
the potential for hyperinflation
Debt andObligations
GNP
with inflation everything gets more valuable except money
What is theSolution?
If inflation is high or rising, what is the best investment category?
A. Paper Assets:• Stocks• Bank Account• Certificates of deposit• Bonds
B. Tangible Assets:• Gold & Silver• Art• Real Estate• Land
Best investment when “discretionary” spending is at an
all-time low? (and likely to stay that way)
• Food• Gas• Rent• Utilities
• Vehicle• Insurance• Health Care• Taxes
Recession Proof Investment• People will pay rent in greater numbers as record breaking foreclosure volumes reduce home ownership and increase non-owner occupied homes
• Rents provide consistent monthly cash-flow
• Rental income typically rises with inflation
• Once the excess inventory on the market is purchased, it is likely home prices will increase to the price of the replacement cost (or higher)
Low Maintenance Cash Flow Real Estate
An Overview
We have a solution that addresses both wealth creation and preservation…
Buy and HoldExamples include:
• Commodity positions• Land• Your personal home• Gold
Cash Flow or Buy and Hold?
Cash FlowExamples include:
• Rental properties• Vending machines• Parking lots• Car washes
Once in a Generation Opportunity
“Buy when there is blood in the streets.” – John D. Rockefeller
“More money has always been made in a down market than in an up market.”
– Wendy Patton, notable real estate investor and broker
“Timing is often the single most important factor determining the success or failure of a real estate
transaction.” - Craig Hall, real estate mogul and author
What is the
Solution
In our lifetime there has never beena better time to buy real estate…
… but it still needs to be the right real estate
Our Approach
What’s Your Investment Style?
Low risk?
High return?
Conserve capital?
Avoid risk?
High Risk
Venture Capital
Start-Up Business
“Private Placements” / Angel Investing
High Reward
7:1 ROI
100%-200% ROI
18%-25% ROI
Low Risk
Certificate of Deposit
Triple-A Rated Bonds
Low Reward
2%-3% ROI
4%-5% ROI
Mason Hill Investments are…Low Risk:• Principal is all in “free & clear” real estate• Cost is 65% below replacement value• 100% controlled by the investor
Moderate Return:• “Cash on Cash” = 10%-12% Annually• Appreciation = 8% to 10% Annually• Tax Benefits = 3%-4% Annually• TOTAL ANNUAL RETURN = 21%-26%
Most real estate investments are entered in to for one of two reasons: cash flow or capital gains. And typically, you get one or the other – but rarely both
“A Tale of Two Cities”
The City You Live In• Great place for family, job, career• Sports, weather, culture, activities
The City You Invest In• Good rental market• Appreciating property values• Ability to acquire property for 50% or less of replacement value
Timing The Market
Mason Hill creates cash-flow opportunities based on:– The ideal time to enter a market– Pricing less than 50% replacement value– Attractive annual return on investment (20%-30%)
90% of U.S. markets are currently on Mason Hill’s ‘avoid list’ (but not all…)
Mason Hill analysts determine market “bottoms” in the 150 key real estate markets we track
Successful Cash Flow Properties…
• Have a competent property manager• Are located in an area where the rental market will remain strong• Are newer (constructed approx. 2000-2009)• Bring in income on day one • Can be purchased for at least 50% below replacement cost
Low Maintenance Cash-Flow Real Estate
Rental properties are an ideal for:– Inflationary times– Steady cash flow– Direct control over investment– Low risk to capital
Mason Hill:– Provides properties that are “rent ready”– Offers properties at 60% to 65% below replacement cost– Locates real estate in markets our analysts predict will appreciate well– Manages the properties and details
Our formula takes into consideration:
• The discount available on the properties
• The rental rates and stability
• The replacement cost of the property
• The potential for appreciation
And when the numbers line up we move in and take a position for our clients
We takecare of
everything
Market analysisAcquisition
Manage it for youMaintenance Agreement
You just get the monthly check
The title is yours…
…and we take care of all the headaches
If you choose …
You can always do it yourself
Or hire someone else
We buy homes, duplexes, typically around 1,400 to 1,600 or so square feet, often with attached two car garages. They within four to five years old and in decent neighborhoods.
Typical Units
Location: Various Locations in the US Style: Single Family Home or Duplex Size: Typically 1400 to 1600 square feet, 3 bed 2 bath Condition: Typically updated both cosmetically (new carpet, new paint) as well as havc, plumbing, fixtures, windows, etc… We can also provide a full one year ‘wall to wall’ warranty, parts and labor, for any major repairs of any kind. Typical Purchase Price: $60,000 to $75,000 Typical Replacement value of the home: $80,000 for materials, $45,000 for labor; $25,000 for a lot = $150,000. Typical Appraisal value = 100k or so (was 200k to 225k two years ago).
Acquisition Price
Monthly Gross Cash Flow
Monthly Net Cash Flow*
Monthly Appreciation
Monthly Cash Flow Plus Appreciation
$70,000
$900
$600
$500 to $1,000
$1,100 to $1,600
Mason Hill’s Model The “back of the napkin” numbers for a property purchased from Mason Hill…
* Deducts property management fee of 10%, property taxes, insurance, and one month’s “vacancy” per year.
The Deal
Purchase Price: $65,000
Monthly rental income: $900
Typical expenses:Property Tax - $45
Insurance - $65 Property Management Fees - $90
Maintenance Agreement - $100Total Expenses ($300)
Typical monthly / annual net rent: $600
Cash on Cash Annual Income $7,200 or 12% Appreciation 0-10%
The Next Step…If you are interested in acquiring a Mason Hill property, please email or call whomever referred
you to our program.
www.MasonHill.com