Real Estate Investing for Doctors

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Doctors would benefit from owning investment real estate. That is a key message from a new book, The Doctors Guide to Real Estate Investing for Busy Professionals by Dr. Cory S. Fawcett

Learn Real Estate Investing from a Doctor with Experience

He has extensive knowledge and wisdom from decades of hard work and learning. He has experience building his own wealth as well as coaching other doctors.

This is his fourth book written for physicians. The author practiced as a general surgeon in the Pacific Northwest.

Dr. Fawcett retired from clinical medicine at age 54. He was financially independent at age 51 but worked part-time for a few years. Now he is fully “repurposed.”

Dr. Fawcett currently makes money from writing, blogging, speaking, and coaching. He doesn’t need the money. His retirement funds and investment real estate rental income far exceed his expenses. Without work, he could spend $18,000 per month for the rest of his life with no significant risk of running out of money.

Would you like that kind of financial security in your early 50s? We all can learn something from how Dr. Fawcett achieved this.

Physical Real Estate is Best

Dr. Fawcett prefers physical real estate when investing. Especially multi-family residential properties. He owned a total of five small apartment complexes at the peak of his real estate ownership. That included a total of 64 rental units.

This is tiny among real estate moguls. But it is a lot more than most doctors own. Wise buying, efficient management, and appreciation combine to generate his current six-figure income. He had an excellent plan, carried out the details well, and is now eager to share with us how he did it.

Overview of this Real Estate Book

He explains why real estate is such a good investment, particularly for physicians. He describes his experiences and actual transactions when purchasing investment properties. Explain why it is always a good time to invest in real estate now.

The gold standard for evaluating real estate investments is the “cash flow method.”  Financing, offers, management, and tax issues are explored.

Benefits of Real Estate Investing for Doctors

There are many benefits to investing in real estate. The big ones are appreciation, depreciation, and cash flow.

Physicians work very hard for their money. The more patients we see and the more risky procedures we do, the higher our income.

Too many of us have only “W-2” income. We are taxed at the highest marginal income tax rate. The harder we work, the more taxes we pay.

Building passive income from real estate requires minimal work. And the income is taxed at a lower rate.  

That extra income gave Cory Fawcett the confidence to cut back on work. He felt confident to renegotiate work contracts.

After his first apartment, he realized more wealth in real estate than he was earning as a surgeon.

Magnify Profits with Forced Appreciation

One of the many benefits of owning investment real estate is appreciation. Over time properties increase in value. Dr. Fawcett purchased a property worth $1 million and now it is worth more than $2 million.

We don’t have to passively wait and be lucky for the price to go up. Sometimes we can force appreciation. Rent increases get magnified.

A $25 per month increase in rent is small. It is barely noticed by many tenants and would not be enough to force people to want to leave. But even $25 per month adds up. A 31-unit complex would increase in value by a six-figure amount. The property will be assessed based on rental income.

31 units times $25 times 12 months per year equals $9,300 in extra passive revenue. Compare this to seeing patients in your office. Getting an income boost of that size would be difficult for many of us. It would require you to see more patients in an already busy schedule.

Pearls From This Book

Many real estate authors are not financially independent. They don’t have six-figure passive income streams. The few who have developed massive wealth don’t want to share their secrets.

Other authors share but are too vague to be helpful. I’m often frustrated by the lack of details of actual deals by authors. This book is refreshing.

Dr. Fawcett shares how he found properties and bought them at a good price. Learn how he financed them. Along with how much cash flow they generate and their current value. The specifics are what make the advice real and authentic.

Useful Real Estate Investing Concepts for Doctors

He explains how to use leverage to speed up your returns. Cory describes how he bought properties with no money down. Your home mortgage is worse than one on a rental property.

He feels there is much less risk in having a mortgage on an investment property. He recommends you pay off your home if at all possible. Once your home is paid off you cannot lose it to the bank. If hard times come you could lose your investment property but not your home.

Furthermore, interest paid on rental properties is deductible. Plus the tenants are paying down your debt for you.

When tenants pay down your debt there is little risk to you. Much less risk than the debt that you must pay yourself from future wages.

Don’t Pay Too Much For Your Property

I recently considered a real estate investment opportunity. An 11-unit apartment building near my home came on the market. They were offering seller financing. The properties are rented and generating revenue of $144,000 per year.

Dr. Fawcett’s book inspired me to look at this deal more. That level of passive income would be nice.

Other tools and concepts in his book helped me do my due diligence and run the numbers. I passed on the deal since I was unable to get the seller to come down to a price that made sense. This book helped me run the numbers and know my final price.

How did I know what my greatest price would be? Well, you’ll have to read the book to understand the full thought process but here’s the formula:

Maximum Purchase Price = NOI / Desired Cap Rate

 

I hope you want to learn more. This is an excellent book for any physician considering buying investment real estate.

Real estate isn’t required. Building wealth can be simple. Save money and invest in stocks.

But for those who want more cash flow and tax benefits, it is tough to beat owning properties. Income-producing real estate is an investment open to all physicians. 

Learn to earn more money without adding time, risk, or more patients to your schedule. Invest in real estate for cash flow, lower taxes, and price growth. But don’t invest without reading Dr. Cory S. Fawcett’s excellent book.

 

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5 Comments

  1. Mike Drak said:

    Excellent article ! After having been in banking for 38 years I agree with everything that you have written and believe it is the way to go if you can. Knowing which books to read so we can self educate is very helpful so thanks for doing that for us Wealthy Doc.

    December 11, 2019
    Reply
    • Mr. Drak,
      Thanks for the comment.
      It is always validating to hear from a professional who has real knowledge and experience in this area.

      December 11, 2019
      Reply
  2. WealthyDoc thanks for your kind words and for supporting me and all the other docs who benefit from your wisdom.
    Dr. Cory S. Fawcett
    Prescription for Financial Success

    December 11, 2019
    Reply
    • Dr. Fawcett,
      My pleasure.
      I hope you continue to have a passion for helping other doctors even though you don’t really need the money.
      There is no better way for the rest of us to learn than from someone who has actually done it.

      December 11, 2019
      Reply
  3. Michael E said:

    Great stuff here Doc, I am new to the site and love what you are putting out to the world. I work with affluent professionals as well and I’ll surely pass on information from your blog. Thank you

    February 15, 2020
    Reply

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