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💸 He Paid Full Price for a House in 1973. He Still Owns It 🏡

Hey RE Rockstar,

Last time we met a nineteen-year-old who bought a twelve-unit building with none of his own money and had 180 apartments by twenty-three.

Today is the other end of the telescope.

Today's subject bought one house in 1973. He paid retail — no discount, no clever structure, 20% down, like anybody else.

He still owns it.

In between: three recessions, four tax-law changes, and mortgage rates that have swung from 6% to 16%.

Meet John Schaub.

Worth knowing before you start: edition 07's subject, Chad Carson, has studied this man's newsletters and classes for eighteen years and hands his book to beginners. The "small and mighty" idea we covered back then came from here.

WHAT WILL YOU GET TODAY?

✔️ See why getting a deal matters less than you think.

✔️ Get the whole plan — it's ten houses, and that's it.

✔️ Learn the one question he asks every prospective tenant.

✔️ Hear the two mistakes he'll admit to, fifty years on.

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INVESTOR SPOTLIGHT OF THE DAY

Meet John Schaub,

Who got his real estate licence in college in the 1960s,

And earned his first commission — $5,000 —

In his senior year, managing an apartment building.

Three years later, in 1973,

He bought his first rental house in Sarasota.

Not a foreclosure. Not a distressed seller.

Retail price. Twenty per cent down.

The most ordinary transaction imaginable.

HERE'S THE BREAKDOWN

That house is still in his portfolio today.

Not sold at the peak. Not 1031'd into something bigger.

Just owned, for more than fifty years,

Through three recessions, four tax-law changes,

And interest rates between 6% and 16%.

By the book's own account, that single ordinary house

Produced over $300,000 in equity across thirty years —

On top of the rent it paid the whole time.

Today he owns 25+ properties,

Managed by himself and one part-time assistant.

No fund. No investors. No syndication.

And when you ask him for the strategy,

It is almost insultingly simple:

Buy one. Rent it. Stop and learn. Repeat.

JOHN'S BLUEPRINT TO SUCCESS

• Buy the house that will always be wanted. He doesn't shop every listing looking for the best price. He looks for a specific kind of house in a specific kind of neighbourhood — safe, near schools, sound construction, a decent lot, in a price band that attracts people who want to stay. The cheap house in the rough area always has the better spreadsheet on day one. It has a much worse decade. And note where he says the value actually sits: in the lot, not in what you do to the building.

• The whole plan is ten houses. Not a hundred units, not a fund. Buy roughly one a year for ten years, then spend the following ten to twenty paying them off. His line: "if you buy 10 houses and get 'em paid for, in almost any market, you're gonna have as much money as anybody in your town." His own father ran a smaller version — three paid-off houses, producing about $3,000 a month in retirement. Work backwards from the income you want and the number is usually smaller than you feared.

• One question, asked of every applicant: "How long do you wanna stay in the house?" That's it. His average tenancy runs about ten years, with some past twenty and thirty. And he's blunt about why it matters: a tenant who stays two years or more makes you money, and a one-year tenancy loses it. Most landlords screen for whether someone can pay. He screens for whether they intend to stay.

BACK TO JOHN'S STORY

Here's the part I'd want you to sit with.

He bought that first house at full price.

Fifty years of compounding did not care.

Which is an uncomfortable thing to read

If you've spent two years hunting for a bargain

And own nothing.

He's also unusually willing to name what he got wrong.

Mistake one: he used short-term seller financing early on —

Five-year notes — and calls it "not a good strategy."

Mistake two: he diversified.

Motels, restaurants, apartments.

All of it, by his account, less profitable

Than the boring single-family houses he understood.

And one structural idea worth more than it looks:

He'd rather have one house completely debt-free

Than the same debt spread evenly across several.

Same total borrowing. Very different worst case.

LESSONS FROM A SELF-MADE MILLIONAIRE

LESSON #1: HOW LONG YOU HOLD BEATS HOW WELL YOU BUY

A retail purchase held fifty years beat

Every clever deal somebody flipped in 1974.

Buy something worth keeping. Then keep it.

LESSON #2: SCREEN FOR INTENT, NOT JUST INCOME

Two years of tenancy is the break-even line.

So ask the question that predicts it.

"How long do you want to stay?" costs nothing to ask.

LESSON #3: THE NUMBER IS SMALLER THAN YOU THINK

Ten houses. Possibly three, like his father.

Calculate the income you actually need

Before you accept somebody else's definition of scale.

LESSON #4: CONCENTRATION BEAT DIVERSIFICATION — FOR HIM

The motels and restaurants underperformed the houses.

He is not arguing that focus always wins.

He's arguing that he was worse at things he understood less,

Which is a quieter and more useful claim.

John Schaub has now invested through more market cycles than most readers have been alive for, and his entire method fits on a postcard: buy an ordinary house in a good neighbourhood, find someone who wants to stay, pay it off, do it about ten times. The unglamorous part isn't a bug in the strategy. It is the strategy.

Do his arithmetic on yourself, right now. It takes two minutes.

Take the monthly income you'd need to stop worrying. Divide it by the net monthly rent of an ordinary house in your area — rent minus taxes, insurance, maintenance and vacancy. Not the gross. The net.

That's your number. That's how many paid-off houses you need. All of it.

Is it ten? Is it four? Is it more than you expected, or a lot less?

Hit reply and tell me the number you got. I read every one.

To the long way round,

— RE Riches

The content of this newsletter is for educational and informational purposes only and should not be construed as financial advice. Conduct your own research or consult a financial professional before making investment decisions.