Benzinga and Yahoo Finance LLC may earn commission or revenue on some items through the links below.
Personal finance expert Dave Ramsey says patience and discipline paid off when the 2008 housing market crashed. With a large amount of cash ready, he swooped in and made deals that he now considers some of the best of his career.
“In 2008, real estate was on sale,” Ramsey said in a recent interview on the “School of Hard Knocks” YouTube channel. “I had a bunch of cash then, and I bought a whole bunch of stuff 15, 20 cents on the dollar. I was buying a lot of really nice properties for nothing. It was a great deal.”
Don’t Miss:
Ramsey, who says his company made $300 million this year, is best known for his no-debt philosophy. He owns an estimated $850 million worth of real estate and says it’s all paid in cash. “We don’t borrow money at all, ever, for anything,” he said. “Risk. Debt equals risk, and the borrower is slave to the lender.”
He said his strategy of avoiding debt completely may have slowed growth early on but protected him during downturns. “We’ve gone slowly because we did it with organic cash,” he explained. “When something like COVID hits, we don’t go out of business.”
Ramsey said he bought the land for his Ramsey Solutions campus for $10 million, even though he couldn’t afford to develop it right away, and waited until he had enough cash to build. He said his real estate strategy is the opposite of what most gurus teach.
Trending: Arrived Home’s Private Credit Fund’s has historically paid an annualized dividend yield of 8.1%*, which provides access to a pool of short-term loans backed by residential real estate with just a $100 minimum.
“Obviously, I’m going to tell you to pay cash and move slow,” he said. “The interesting thing about real estate, when you don’t have any debt on it, is it cash flows. Like crazy cash flows. Like lots of cash.”
He said the first few properties are the hardest, but once cash flow starts, it builds momentum. “If you get one or two properties, pretty quickly they’ll throw off enough cash to buy the third one,” he said. “And then you get this positive snowball working in your favor.”
Ramsey said patience is what separates lasting wealth from short-term gains. “One tiny little step at a time,” he said. “One tiny conversation at a time.”
