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💸 He Put a Curtain Across His Living Room. It Paid the $99,600 Mortgage 🏙️
Hey RE Rockstar,
Madusanka here from RE Riches.
Everyone in an expensive city says the same thing: the numbers don't work here.
Today's subject agreed with them. He was earning about $40,000 in tech support in New York and doing standup comedy at night.
So he bought anyway — on a rule that made the numbers question almost irrelevant.
He never once paid for the upside.
Meet Alan Corey.
Up front, because it changes how you should read this: his purchases run from about 2001 to 2008, in Brooklyn. A $99,600 one-bedroom in Brooklyn is now a historical artefact. The prices do not transfer. The rule does — and the rule is the entire edition.
WHAT WILL YOU GET TODAY?
✔️ Learn the purchase rule that makes appreciation free.
✔️ See how he saved $10,000 in a year on a $40,000 salary.
✔️ Get the reason he deliberately bought the worst-located building on the street.
✔️ Understand why a story with no disaster in it should make you more careful, not less.
[SPONSOR SLOT — place partner ad here]
INVESTOR SPOTLIGHT OF THE DAY
Meet Alan Corey,
Who worked tech support in New York,
Earning roughly $40,000 a year,
And performed standup comedy at night.
He lived in Spanish Harlem.
In his first year he saved $10,000 — on that salary, in that city —
By doing one unremarkable thing:
He split his direct deposit 50/50 between two accounts,
So half the money never arrived anywhere he could spend it.
HERE'S THE BREAKDOWN
The first flat was a one-bedroom in Brooklyn.
Asking $110,000. He bought it for $99,600,
With $10,000 down — the exact amount he'd saved.
Then he hung a heavy curtain across the living room,
Called it a second bedroom,
And put a roommate behind it.
The roommate covered the mortgage.
The second was a duplex five doors away — about $450,000,
$15,000 down plus roughly $30,000 of hard money.
Six bedrooms across two units. He rented five of them to comedians,
At $600 to $750 a month each.
That produced about $2,000 a month in profit —
More than his job paid him. So he left the job.
The third, at twenty-five or twenty-six, was another Brooklyn duplex.
Asking $1,000,000. He paid $990,000,
Funded with a $300,000 HELOC against the second building — about 30% down.
It sat directly underneath a six-lane expressway.
Nobody wanted it. It produced about $2,000 a month.
In 2008 he and two partners bought a mixed-use building in Red Hook for $400,000, spent about $200,000 on it, and sold it roughly a year later for about $1.1 million. His share was around $150,000. The buyer, as reported at the time, was Barbara Corcoran — the subject of our edition 02.
Today he holds roughly 69 units personally, worth in the region of $8 million.
Graphic 1 — the arc
ALAN'S BLUEPRINT TO SUCCESS
Never pay for appreciation. This is the whole thing. In his words: "I never bought a property because I thought it was going to appreciate. I bought it because it paid a bill." He describes every property as carrying an imaginary lottery ticket — it might be worth something one day, it might not. You want the ticket. You simply never pay for it. Which means the only question at the point of purchase is whether the building covers its own costs today, on today's rent, with nothing assumed.
Buy the flaw. A living room behind a curtain. A house full of comedians. A duplex under an expressway. Every one of those is a reason somebody else walked away, and every one of them is a discount. The flaw is what you're paid for; the cash flow is what you check. He didn't need a good building. He needed a cheap one that covered itself.
Automate the saving before you can touch it. The unglamorous part, and the part anyone can copy this week. Half the salary redirected on the day it lands, into an account he treated as not existing. $10,000 in year one, on $40,000, in the most expensive city in America. That $10,000 became the down payment on everything that followed.
Graphic 2 — the mechanism
BACK TO ALAN'S STORY
Now the part that keeps this honest, because the ending flatters him.
Four years after he bought the duplex under the expressway,
The neighbourhood re-rated.
A developer bought the New Jersey Nets in 2004 and proposed moving them to Brooklyn;
Ground was broken in 2010; the arena opened in September 2012.
He bought before the plan and sold into the speculation it created.
His rule did not predict any of that.
What the rule did was mean he didn't need it to happen.
That is the strongest version of the argument — and also its limit. The outcome still contains a large amount of luck he did not earn. Somebody applying the same rule two miles away got the cash flow and no lottery ticket at all. That's the deal. You're buying the income, and the ticket is free precisely because it might be worthless.
Two more things.
The third purchase was funded by borrowing against the second. One building's equity buying the next one, eighteen months before the financial crisis. It held, because both covered their costs. If either had stopped, one problem would have become two — and that risk is structural, not hypothetical.
And something a careful reader should notice about this edition specifically: there is no disaster in the public record. No blow-up, no foreclosure, no year he'd rather not discuss. Either he was unusually careful, or the story as told publicly is incomplete. We looked and found nothing — but a success story with no failure in it should raise your eyebrow slightly, including this one.
Graphic 3 — the payoff
LESSONS FROM A SELF-MADE MILLIONAIRE
LESSON #1: THE ONLY APPRECIATION WORTH HAVING IS THE KIND YOU DIDN'T PAY FOR
If the deal needs the price to rise, you didn't buy an asset.
You bought a forecast, at full price.
LESSON #2: THE FLAW IS THE DISCOUNT
A curtain, a comedian, an expressway.
Everything wrong with a building is already in the price.
Everything wrong with the income is not.
LESSON #3: DECIDE ONCE, NOT EVERY MONTH
He didn't budget. He split the deposit and stopped thinking about it.
One decision, made once, produced the down payment for a career.
LESSON #4: BE SLIGHTLY SUSPICIOUS OF CLEAN STORIES
Including this one.
Fifty investors bought under expressways in 2004.
You are reading about the one where an arena turned up.
He was twenty-two, earning forty thousand dollars, hanging a curtain in a living room so a stranger could sleep behind it. The lottery ticket came later, and he'd be the first to say he didn't buy it.
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This one takes two minutes and costs nothing.
Think of the last property you seriously considered — the one you ran numbers on and didn't buy.
Now strip out every assumption about what it would be worth later.
At today's rent, does it cover its own costs? Yes or no?
Hit reply with the answer and your city. I read every one, and I'm building a picture of where in the world that question still gets a "yes."
To never paying for the ticket,
— Madusanka, 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.
