Several of the wealthiest individuals on earth got their start in real estate, making it a typical "rags-to-riches" story. Forbes reports that 193 billionaires were made in the real estate industry.
"90% of all millionaires become such through owning real estate," Andrew Carnegie is reputed to have said. Real estate investments have yielded greater returns than those in any other industry. Today's savvy young professional puts his or her savings into property.
Many people have made their fortunes in the real estate industry.
Sam Zell, founder and chairman of Equity Group Investments, started off as a teenager in Chicago distributing Playboy magazines before moving on to manage student flats and eventually developing some of the largest publicly traded real estate investment trusts (REITs) in the world. The property tycoon amassed a wealth estimated at $5.4 billion.
After being laid off from Bear Stearns in 1972, Stephen Ross used a $10,000 loan from his mother to start arranging deals for affluent investors to fund affordable housing complexes, which provided them with a tax haven and hefty incentives from the federal government. Ross, who established The Related Companies, is currently worth $11.6 billion.
While real estate can be a stepping stone to success, it is by no means the only benefit it can provide. With its safety, cash flow, and massive tax benefits, this asset class is where most multi-million and billion-dollar portfolios are invested. A few well-known millionaires are engaging in some really creative real estate strategies.
In 2021, Jeff Bezos participated in the seed round of financing for Arrived Homes, an innovative real estate firm, and in 2022, he invested heavily in the company's series A round of financing. The firm purchases single-family rental residences all around the United States securitizes them, and then sells shares to private investors for as little as $100.
Around seventy-five million dollars worth of property has been funded through the investment platform, allowing tens of thousands of investors to become fractional landlords.
Elon Musk, CEO of Tesla Inc, Twitter, and SpaceX, may be entering the residential real estate market on his own by collaborating with Lennar Corp. to construct "Project Awesome," a new residential area of 110 homes in Bastrop County, Texas.
The first phase of Musk's partnership with Lennar will involve the construction of 110 homes, but this is likely just the beginning of their collaboration.
Musk stated that more homes were necessary for Texas in April of 2021.
More homes are needed immediately in the Austin metro area, so please start construction right now. As he put it on Twitter, Musk said.
Musk looks to be taking matters into his own hands to remedy the housing scarcity in Texas, where he has already created a number of employment through SpaceX, Tesla, and The Boring Company.
What are your thoughts on these two tech titans entering the space? Let us know in the comments below!