Author Archives: hbcumoney

HBCU Money™ Business Book Feature – What Every Real Estate Investor Needs to Know About Cash Flow

The Classic Guide to Real Estate Investing―Updated for a Re-energized Industry!

Real estate is once again a great investment, and this bestselling guide provides everything you need to know to get in now and make your fortune.

What Every Real Estate Investor Needs to Know About Cash Flow removes the guesswork from investing in real estate by teaching you how to crunch numbers like a pro, so you can confidently judge a property’s value and ensure it provides long-term returns.

Real estate expert, Frank Gallinelli has added new, detailed investment case studies, while maintaining the essentials that have made his book a staple among serious investors. Learn how to measure critical aspects of real estate investments, including:

  • Discounted Cash Flow
  • Net Present Value
  • Capitalization Rate
  • Cash-on-Cash Return
  • Net Operating Income
  • Internal Rate of Return
  • Profitability Index
  • Return on Equity

Whether you’re just beginning in real estate investing or you’re a seasoned professional, What Every Real Estate Investor Needs to Know About Cash Flow has what you need to make sure you take the smartest approach for your next investment using proven calculations.


The Finance & Tech Week In Review – 5/20/17

Every Saturday the HBCU Money staff picks ten articles they were intrigued by and think you will enjoy for some weekend reading impacting finance and tech.

The world’s most valuable brands in 2017 / WEF

Co-authorship in economic history and economics: are we any different? / NBER

Not sleeping? You might be part of a genetic elite / WEF

These are the industries attracting the most venture capital / WEF

Want to buy a home at the start of your career? Get one of these 10 college degrees / Housing Wire

Our brains prefer invented visual information to the real thing / New Scientist

LIGO could detect gravitational waves’ permanent space-time warp / New Scientist

Roomba-like tech heads for the garden / New Atlas

Users have little confidence their company can protect their mobile device / CSOonline

Mercedes-Benz Confirms Electric Citaro Bus Coming Next Year / Clean Technica

How I Learned to Negotiate Salary

By Kimberly R. Lyle

It wasn’t until my late-20s that I started to get serious about asking for more money than I was offered. At the height of the Great Recession, I quit my job and moved back to my hometown. I applied for any job I could find, and surprisingly, I landed a gig a month later. It was a big step down, but I was grateful to secure something as quickly as I did. I didn’t bother to negotiate my salary.

I worked at this job for a few years until I was laid off. Luckily, my job fell under a union contract so I had a lot of resources available to help with the transition, including priority status for other positions within the organization. I saw the layoff as good fortune – I was guaranteed up to six months of full pay and benefits – and it was a chance to break away from a job I was severely overqualified for.

After the recruiter who had been assigned to help me find another job within the organization got pissed with me for turning down an offer for a lateral position, I committed to only applying to jobs with more responsibility, more money, and a bigger title (I know we’re in this new age of “titles don’t matter!”. Don’t play yourself. They do.). I wasn’t fucking around anymore.

One of the next roles I applied to seemed like a step in the right direction. I exceeded the required and preferred skills and experience, but not by so much that they’d think I was overqualified. The recruiter called me for a phone conversation; it went great! She invited me in for a face-to-face interview. A few minutes in, she started talking about an entry-level position that just opened up in the department, how I’d be a great fit, the hiring manager wanted to fast-track the position, and it would be a great way to work myself up to the position I applied for. The fucking okie-doke of okie-dokes. I let her know that I wasn’t interested in pursuing the entry-level job, and went on about my damn business madder than a mutha fucka.

That’s the first time it dawned on me that employers offer what they think you’ll take. This recruiter thought I was desperate. She saw that I was young. She figured I’d be grateful for the “opportunity”. I guess she was doing her job. I was doing mine by walking away.

A few months later I landed a permanent job within the organization. It was a solid step in the right direction. I didn’t negotiate the salary though. Their offer was already significantly higher than what I made in my last job; it seemed fair. But a few months into the role I realized I was severely underpaid. I decided to ask for more money.

I looked up comparable job descriptions in the internal HR system, and made note of how jobs were categorized, and what the pay scales were. I familiarized myself with internal documentation about departmental budgets, and HR policies governing compensation and raises. I wrote down all the skills I used in my role and examples of how I was kicking ass. I documented praise from colleagues and other managers. Then I scheduled a meeting with my boss.

I made my case, and as a finishing touch, I made it clear that I enjoyed working there, looked forward to continued success on the team, and felt confident that I’d have her support in getting my salary to align with the quality and skill I delivered.  She worked with HR to get me raise, and it was significant. From that point on, I never even considered a job offer without at least attempting to negotiate the offer. I’ve successfully negotiated my salary since this first big win.

Negotiate your damn salary, people. If you’re currently in a job that’s paying you less than you should be getting, ask for more any damn way. They can say no, and if that bothers you enough, you can kick rocks. But you have to at least try to get your money.

The soft offer I got for my last job was low. There was nearly a ~$20k salary difference between what the recruiter initially told me and the offer I accepted. The recruiter told me all about the total benefits package, the annual bonuses and raises, and all that great stuff. Thankfully I did not get on board with that initial number.

Within two months the job went from Oo-la-la to what-the-fuck. And you know what? I would have hated it a million times more if I had been doing that job for nearly $20k less. Can you imagine? Money doesn’t buy happiness, but when you’re in a miserable job it sure helps when you can afford to drown your sorrows at the bar.

I did not get the annual raise the recruiter told me about, and the portion of the bonus I received was a fraction of what I expected. So imagine the level of stank that would’ve contaminated my spirit if I would’ve had doing that job for $20k less, not getting a raise, not getting a bonus.

Upfront money is the best money. It’s usually the only money that’s guaranteed.

So what is the damn point of all this? Here’s what I learned from these adventures:

Employers Do Not Have Your Best Financial Interest At Heart 

Until I realized the jiggery I assumed recruiters were making me their fairest offers they could make. What decent person would offer you far less than what your work is worth, even if you don’t know its worth? A recruiter, that’s who. They ain’t your friends. That excitement you hear in their voices when they’re making you the offer? They’re paid to be excited, boo. Their first offer is never the highest they can go, otherwise they would’ve given you a lower offer. They’re function is to get the best talent for the low-low.

Know What You Need and Know What You Want

Salary negotiation experts usually tell you to know what your salary floor is. But you gotta know it-know it. Don’t just calculate how much you need to pay necessities like rent, food, utilities, and buy your transit pass. Think about the things in live that give you joy, or the things you’d want to do. How much does it cost to take a yearly vacation? How much money do you need to maintain your art supplies? To save enough money to quit working for other people? To get your credit un-fucked up? This is why you’re going to work every damn day. So know how much you need to make all of this happen.

An offer at $7k less than what you want might not seem like that much when the excited recruiter is telling you about the 401(k) match, free beer, and tuition reimbursement. Depending on your situation, it might be inconsequential. But remember this: the costs of most things increase – food, utilities, clothes –  and often these increases outpace annual salary increases. Plus, bonuses and raises are usually a percentage of your base salary. So if you shortchange yourself on salary now, you shortchange yourself on bonuses and raises later. This just compounds and it can impact what you make at your next job.

Perks and Bonuses Ain’t Guaranteed Money in the Bank

People make a big deal of companies that offering perks these days.

Snacks. Ski trips. Annual performance bonuses. Childcare discounts. On-site gym. Tuition reimbursement. Yaaay! These things are great but many aren’t guaranteed. Besides, you may not even need all of this shit. Recruiters usually rattle off all the perks right after they tell you the salary because it all sounds more robust to hear the full package. But when you take a minute to parse out which of the perks you actually give a damn about, it might not be so sexy.

When you get an offer lower than expected it’s so easy to start relaxing your salary requirements after you hear about all these other amazing things you’ll get. Oh, and they are amazing things. But you don’t even like snow so what’s a ski trip gonna do for you? You don’t have kids and you don’t want any, you hate the gym, and you’re never going back to school. So you’re left with some damn snacks. And maybe a bonus.

Figure out the true value of these perks for your life.

Rehearse, Rehearse, Rehearse

I get unsettled and anxious every time I speak to a recruiter or manager about money. How do I get over it? I don’t. I just practice what I’m gonna say.

Money conversations with recruiters or managers are generally predictable – “we don’t have room in the budget”, and, “there’s nothing I can do”, or “what number did you have in mind”. I rehearse what I’m going to say and what I think the recruiter or manager could say. I type out my responses, say them aloud, edit them, and do it again. I practice in the mirror. I record myself and listen. If I’m having a face-to-face meeting with my boss, I’ll put on a full outfit with hair and makeup and practice that way. Yes, this is crazy. But why the hell not. Gotta start somewhere.

None of this is rocket science but it’s worked for me. Figured I’d share. Maybe it’ll help someone.

Kimberly R. Lyle is the creator behind Audacious Kay. This rerun is with the consent of Audacious Kay and may not reproduced otherwise. Visit her blog by clicking here.

2017 National Real Estate Preview: HBCU Alumni Real Estate Agents Look Ahead To The New Year

An HBCU alumna and ally who are now prominent real estate agents sit down and talk with us about what to potentially expect for the year ahead in the real estate market covering coast to coast.

Tiffany Curry (top left) – A Texas Southern University alumna who now works for Berkshire Hathaway Home Services Anderson Properties in Houston, TX.

Kimberly C. Lehman (top right) – An HBCU ally who is married to a Hampton graduate and now owns and runs KC Lehman Realty as a division of John Aaroe Group in Los Angeles, CA.

What do you believe the rate hike in December by the Federal Reserve may do to the coming year of real estate?

TC: I believe the rate spike will motivate buyers that have been on the fence. I think people will fear the rates may continue to rise and that we will see an increase in buyers purchasing homes. Rents are at record highs. It is still less expensive to own vs. lease.

KC: If the interest rates rise in the way we expect, it will impact how much buyers currently in the market can afford. As such, home values should level out, but many buyers will continue to be priced out.

Tell us something that makes you optimistic and pessimistic about the 2017 real estate market?

TC: I’m excited that the 2017 market has already shown positive signs of movement. I currently have clients who are ready to sell and purchase new homes in the first quarter of 2017. I expect my business to double in the 2017 year which is remarkable in the current marketplace. Consumers are seeing value in homeownership and are trading their homes for more space or better locations.

KC:  Optimistic: In Southern California, there is no shortage of buyers, and therefore opportunities for business continues to grow. If values level out, that might balance out the supply and demand which also equals more opportunities for business.

Pessimistic: Uncertainty of our new administration has sellers that ordinarily would sell right now holding tight. Also current home values will cause some buyers who are unwilling to compromise on property location and/or condition to drop out of the game.

Where do you see the most opportunity for real estate investors in your market for 2017?

TC:  In Houston, we have a diverse and growing economy. I see development as an excellent place for investors. Land purchases should be key for investors as the Houston population will nearly double by 2040. Land will become scarce and is a great opportunity for someone that can buy and hold.

KC: Southeast Los Angeles if they are smart. They missed the boat on Inglewood.

Companies like Redfin, Zillow, and others are disrupting the traditional real estate market. How are you seeing their presence influence the real estate market?

TC: Houston is a rare marketplace where we have our own local consumer public facing website, is the only site in the US where Zillow, and others do not hold prominent market share. This has enabled brokers and agents in the market to maintain their presence without the need for an outside third party. Redfin however has come into the marketplace as they offer a discount service. Consumers who want to save on commissions are using their services however it is in line with the traditional discount brokerages that would have attracted this type of consumer. Although they are capturing consumers they still are a very small impact in our local market as most consumers still want the guidance and expertise of a REALTOR that has time to handle their needs rather than one that is focused on transactions.

KC: Buyers and sellers are relying on these sites to educate them about the real estate process and home values. As it relates to the latter, none of these sites are truly accurate. Redfin in particular has gotten their own market share of listings and buyers through their site and their agents are in direct competition with those of us at traditional brokerages. They aren’t always knowledgeable of the areas they are tied to via the site. I’ve heard horror stories!

On the upside, Zillow reviews are liquid gold to agents in the field.

Since reaching its all-time high of 49.1 percent in 2004, African American homeownership has now fallen to an all-time low of 41.1 percent as of third quarter 2016, an almost 20 percent decline. What do you believe can be done in the foreseeable future to reengage the African American consumer?

TC: I believe the African American consumer must be reeducated on the value of homeownership. Homeownership for most Americans is their primary source of wealth and assets. I believe our communities, churches and social groups must put more emphasis on the value of owning the land beneath your feet. As one of the largest groups in consumer spending we must do a better job of prioritizing what we spend our monies on. Material items that depreciate are not the key to wealth. Laying the foundation to a solid financial future for our children and their children’s children are what we must focus on. Building and maintaining our communities by owning what is in them is key.

KC: African Americans need to pool resources in order to compete with the current buyers in the market. Often, our community looks to FHA, NACA, CALHFA and other government programs to help us – but unless we are shopping in low income areas, we can’t compete with the cash offers elsewhere. If we work together and create real estate investment groups we can began to establish potential generational wealth for our heirs.

Thank you for participating ladies and we look forward to your 2018 forecast! To reach these agents please click their names to be directed to their websites.

Tiffany Curry – Houston, TX

KC Lehman  – Los Angeles, CA


HBCU Money™ Business Book Feature – The Index Card: Why Personal Finance Doesn’t Have to Be Complicated

TV analysts and money managers would have you believe your finances are enormously complicated, and if you don’t follow their guidance, you’ll end up in the poorhouse.

They’re wrong.

When University of Chicago professor Harold Pollack interviewed Helaine Olen, an award-winning financial journalist and the author of the bestselling Pound Foolish, he made an off­hand suggestion: everything you need to know about managing your money could fit on an index card. To prove his point, he grabbed a 4″ x 6″ card, scribbled down a list of rules, and posted a picture of the card online. The post went viral.

Now, Pollack teams up with Olen to explain why the ten simple rules of the index card outperform more complicated financial strategies. Inside is an easy-to-follow action plan that works in good times and bad, giving you the tools, knowledge, and confidence to seize control of your financial life.