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Cliff Hockley, CPM
President, Bluestone & Hockley Real Estate Services
King Markus was brooding in his castle. He was broke once again. He turned to his wife, Queen Aminah.
“I was thinking about adding a couple of rooms to our castle, but once again our treasury lies bare. I hate borrowing from the moneylenders, and the citizens are already too taxed. One more tax will result in a revolt. That’s what happened to King Phillip in the neighboring kingdom.” He paused dramatically. “Now, on the other hand…I hear that Queen Barika about two hundred miles away seems to have no problem with money at all. I wonder what I should do?”
His wife was very wise. She looked up from her scroll for just a moment. “I would send someone to the court of Queen Barika to see what her secret is.” She returned her attention to the scroll and her eyes began scanning across the page.
He knew what she was implying. “I know just the person—especially since Queen Barika is your sister!”
So off Queen Aminah went to visit with her sister.
Queen Barika was overjoyed to see Aminah. When she asked what prompted the visit, Queen Aminah rolled her eyes, threw up her hands in exasperation and explained.
“Once again my husband has squandered our kingdom’s funds. Our treasury is empty! He sent me here as an emissary to see if I could learn from you how to make money and not tax our citizens to death!”
Queen Barika offered a sympathetic smile before offering her wise advice. “Our vizier has encouraged me to buy important corners in our cities, and then lease them to local businessmen. I, for one thought he was crazy, but over time we have been able to increase the rents to our tenants and help pay our bills. We’ve even been able to expand the Kingdom rather than wage war. I have sent my son to learn from the vizier so that we can pass this knowledge to our children.”
“May I learn from your vizier?” asked Queen Aminah.
“Of course!” Queen Barika immediately summoned the vizier. They traveled to his office and began by teaching her the mantra: Location. Location. Location. He then taught her how to evaluate the condition of buildings as well as the credit standing of potential tenants.
After a couple of weeks sitting at the vizier’s side, Queen Aminah had a question. “How does this work if you have no money? Our treasury is empty, and while these look like great ideas, I have no money to start!”
The vizier, a gentle and patient man understood. “I, too, was very poor, but my friend the moneylender took me under his wing. He gave me a book to read by George S. Clason called The Richest Man in Babylon. And then he gave me a job and helped me save some money.” The vizier offered the key points he learned from the book he had been given:
- A part of all you earn is yours to keep.
- There are nine cures for not having enough money to invest
- Start saving money
- Control your expenses
- Pay off your debts
- Invest your savings wisely
- Invest slowly and cautiously
- Live in a comfortable environment, keep your family happy
- Plan ahead for a future income for your retirement.
- Increase your ability to earn, get more education, and be reliable, work hard
- Where there is a will, there is a way
“Hmm…All of these ideas seem like common sense,” said Queen Aminah. “How come it doesn’t seem as obvious to other people?"
“We started young. When I was just an apprentice moneylender I learned to save ten percent of my income every week. In the beginning it wasn’t much. But my mentor allowed me to invest what little I had with his larger investments. When a ship went out to buy salt, my ten coins were in the captain’s hands, and I received a small part of the profits back. Over time I could invest more and more. But I was cautious and never put all of my eggs in one basket! I was thankful for that when, in our fifth year of investing together, a ship did not return, lost at sea with all hands aboard. By my tenth year I had saved enough and invested enough to buy a small building at a great location. The profits from that building gave me the financial strength and collateral to buy another one two years later. It was at that time that Queen Barika came to me seeking advice. I had become a partner with the moneylender and had visibility at the court of our kingdom. She gave me 100 talents of silver to invest for her and we developed a long-range plan for the Queen and her kingdom.” He paused and smiled at her. “As you can see, it has paid off.” The vizier made a sweeping motion with his hand to indicate his beautiful home.
“I see,” Queen Aminah mumbled.
Queen Aminah spent a month studying with the vizier. “There sure is a lot to learn from the vizier. What a very smart man.” Queen Barika agreed as Queen Aminah continued. “I hope your son learns much from the Vizier, because if he is a good student, you will have the greatest kingdom of all time! And now it is time for me to go and report to my husband, King Markus.”
The king had missed her and was pleased to see his wife back home. “Tell me all that you have learned!” He hoped her trip had been worth the while.
Queen Aminah was serious. “It is time for us to get to work! No more parties and lying around the castle. We must have a plan!” King Markus was surprised by his wife’s energy. But he became a bit unnerved when she gave him a look of warning and leaned closer in, as if she were about to tell him a sacred secret. “If we are not careful, my sister will buy our kingdom and we will have nothing.” King Markus knew this was serious.
She spent two next days explaining how the vizier had helped her sister and had now helped them. They both agreed that they could do it to. They prepared a budget, vowed to save ten percent of their income, and started investing. It took five years before they had enough money to buy real estate, but they had saved a substantial amount of money and had invested wisely. And they lived happily ever after.
The moral of the story: You too can develop a strategy to invest in real estate. Just ask Carlton Sheets, Donald Trump, Robert Randall or Joe Weston, to name a few.
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