Creating Wealth Through Real Estate Investing

One of the first items that I did when I set out on my own journey was to create a personal financial statement which became the foundation for building wealth. This includes a list of all of my family’s assets and liabilities similar to how businesses look at their balance sheet as well as a cash flow summary. This spreadsheet allows me to take a global view of my financial position and help prepare me for how lenders will see me. This will also uncover where there are risks for example am I spending too much on the credit card, how much debt do I have compared to my income, can I move this piece over here to acquire another asset that produces more income. It’s like a chess board that helps you come up with creative solutions to maximize your position.

To help you out we have put a sample financial statement in the download section for the week. I encourage you to fill this out and calculate your personal net worth. A lot of us know generally where we are but have not yet quantified and tracked this on a monthly or quarterly basis. As the old saying goes "what gets measured gets monitored" and I think this will help your financial position over time. Finally, as you begin to look at personal financial statement, think about areas where you can move things around to potentially fund your first deal.

Personal Finance – for many people the topic forces a yawn or two. And I know, the reason you picked up this course was to learn about real estate investing. Many of the folks that I speak with are chomping at the bit to get started however few have built a solid financial base to set us up for sustained success in the marathon game of investing. When I was in high school my parents would try to talk to me about the importance of saving my allowance or working for the neighbors to raise additional money. Most of it fell on deaf ears until I needed spending money. And then I went into a hyper speed frenzy trying make as much money as I could in a few short hours so I could buy that new CD (which is music that old folks used to listen to). My problem, like many people, was the need for instant gratification, something that plagues our society. We see it and we must have it - now. That’s the beauty of credit cards and loans – buy now, pay later. Some folks are really responsible with credit while others just need some additional help. No one here is try to judge you but your credit score will have an immediate effect on your creditworthiness and I want you to have the best credit score possible.

Maximizing your credit

My first job out of college was working customer service at MBNA America, the largest independent credit card issuer at the time. While at MBNA I spoke to roughly 100 customers a day. After a while I began to see patterns in the customer profiles.

Profile 1: There was the ‘little old grandma’ that only spent on groceries and gas and then paid off the balance at the end of the month. She was on a fixed income and wanted to be responsible with her credit. This type of consumer was never late on their payments and had an 800 credit score.

Profile 2: Next we have the responsible users that used the card for rewards/points, perhaps for a small business that they owned, they made their payments on time and may or may not paid in full each month – credit score was maybe 720 or so.

Profile 3: Finally, we have the apathetic users identified as late every other month, over the credit line, cards lost or stolen, and were probably cut off from making any additional charges a long time ago – their credit scores were below 600.

For each profile I could quickly see how much interest and fees were assessed over the last rolling 12 months. I bet you can guess which profile paid the most in fees each year.

Credit is an amazing thing that we have here in America. Many countries lack the sophisticated lending systems that many times we take for granted in the states. But with this advantage comes great responsibility. Those who use credit wisely can literally leverage their way to riches in real estate and that’s why I want you to have the best credit possible.

If you haven’t already reviewed the Guide on Maximizing your Credit, please head over to the download section now and take a look. In this guide you will find out:

How are credit scores are calculated?

What can you do to improve your credit score?

And other helpful tips and tricks to help you keep that solid credit rating.

Goal Setting

Goal setting is probably the most important thing you can do. I know, you’ve heard all the great reasons why goal setting is so important…blah, blah, blah but the fact of the matter is that most people just don’t set goals. I know that it has worked for me for over 20 years. In fact, I cannot escape my goals. They are written everywhere and I review them daily. I have a large white board in my office and I have my top 10 financial goals for the year. This has helped keep me on track when I see other people driving expensive cars and living beyond their means. The fun part is not setting the goal, its achieving them and looking back over a period of time. One of my favorite quote is from Grant Cardone saying, “Grind while they rest. Study when they party. You’ll live like they dream”

The other great part of goal setting is planning your acquisition strategy. This is the part that got me really geeked out. I loved the process of planning my escape route from corporate America. I can recall dreading flying to a business meeting. On the plane I should have been reviewing my sales pitch but instead I would write in my notebook various ways to make enough cash flow to quit my job.

Here is an example ---

And another ---

And another---

I would plan and re-plan, and update, and iterate some more. I became obsessed until I finally escaped the rat race but the funny thing is that I still am as obsessed with the numbers as I was 10 years ago.

Several years back I put this spreadsheet together several years ago. It solidified all of the notebook planning that I had done. Again, the idea was to build enough cash flow to quit my job. One of my favorite quote is from Grant Cardone saying, “Grind while they rest. Study when they party. You’ll live like they dream”

So the last thing I’ll mention is that I want you to achieve your goals for both this course and 2021 and to help you out we have created a Goal Setting Sheet in the download section. And as you’re reviewing it I want you to take a look at the goals you set out at the beginning of the year or if you are a bit behind, create new ones for the remaining part of 2021. And I’m going to help you with your first goal – get your first deal under contract by the end of this course. There is no doubt and if you keep going through each lesson and take massive action, you will be able to do it. Who knows you might be closer than you think!

Saving for your first deal

Before I created a multi-millionaire business there were tens of thousands, of tiny little steps I had to take each and every day to ensure that directionally I was always headed towards my goal of financial freedom. There are those daily sacrifices that are made because every little bit adds up, like forgoing Starbucks. For me my financial life is just one extremely long spreadsheets of debits and credits. I know it’s cold and impassive to view the world like this but it’s true. And if your goal is to invest in real estate, you are going to need a small nest egg to get you started. I was in sales for 15 years before going full time. My wife and I would save 15% of our W2 income as well as any commission I would make from the sales. Once we saved up for a 25% down payment, we would go shopping for a rental. After buying that rental, we would kinda go broke until we saved up for the next house. We would also use the extra cash flow from our first properties to then buy the next. Before long we were snowballing enough money to begin acquiring 4 properties a year. This is how we began House Stacking. This process takes commitment and dedication and it is critical to your long term success.

So the question is, where do you save? Do you have a saving account? Here’s my recommendation – Create a separate savings account where you can funnel money for the direct purpose of your first deal. This should be separate from your personal savings and emergency fund. Think of this as your new business account where you direct additional money from various sources and the faster you have a down payment and closing costs, the faster you can buy your first deal. You may elect to have an automatic payroll deduction of a certain percentage like 10% routed to this account each month. Additionally there are several other ways to fast track the balance of this account – think creatively. I’m talk about working overtime, bonus checks, commission, garage sales, Ubering, maybe selling those collectible items. The account balance will grow in direct proportion to how bad you want it and how creatively you're willing to get.

Maybe you already have enough money in savings. Here are some not as obvious sources

1. 401(k) – many employers will allow you to take a loan from your 401(k). You will need to check with your HR department to see if this is an option.

2. IRA – I had a few old 401(k)s sitting in an IRA from previous employers. I took those funds and opened a self-directed IRA where I bought more real estate. This has been one of the best moves I could have made to expand my portfolio.

3. Home Equity Loan or Cash-out Refinance – Maybe you have a considerable amount of dead equity sitting in your primary house not earning any return. Why not pull that cash out, refinance at historic low rates and go buy a property? I have done this 6 times each time buying more real estate that provides a 10% cash on cash return verses saving 3% in interest.

Some people will say that this is risky but let’s look at an example of how this can work in your favor:

Let’s say you bought your primary house several years ago, you paid $350,000 and put $70,000 or 20% down at an interest rate of 4.5% with a 15 year term. Over the next few years you paid down the principal balance and the house appreciated (3% per year) in value. Here’s what the numbers look like today:

Current home’s value: $400,000

Equity in home: $180,000 ($70,000 down payment, $50,000 appreciation, $60,000 principal pay down)

Principal and Interest Payment: $2142 (negative cash flow of $2142) over 15 year term

Now let’s take a look at how a cash-out refi will affect the monthly cash flow. We will keep 20% of equity in the house (current rule for conventional and FHA) which is $80,000 and use the remaining proceeds of $100,000 to use as a down payment on a 4-plex unit. Here is another trick to improve cash flow – we are going to change the term from 15 years to 30 year. Again, we are only concerned with increasing our monthly cash flow. Let’s run the number again:

Current home’s value: $400,000

Equity in home: $80,000

Principal and Interest Payment: $1621 (negative cash flow of $1621) over 30 year term

And

New 4-plex value: $400,000

Equity in 4-Plex: $100,000

Principal and Interest Payment: $1520 (negative cash flow of $1520…Paid by your tenants!)

Positive cash flow from operations: $800 ($200 per month, per unit)

Net cash flow = $2142 (old payment) - $1621 (new payment) + $800 (new cash flow) = $1321 Net new cash flow.

Notice that I did not include the P & I from the 4-plex. Why? Because the tenants are paying this and giving you $800 more than the expenses. Do you see how repositioning your assets can create greater cash flow? Please note that I’m using round numbers and there will be things like closing costs and changes in interest rates which will affect the actual numbers. But you get the point. The first 3 times I did this I only had to pay a few hundred dollars in fees because the banks were hungry for business. This one strategy is responsible for 6 houses that my wife and I purchased.

Getting educated
Let’s discuss your education journey. You have already made a wise decision to buy this course and invest in yourself. Admittedly this course is not cheap and neither are you. Commit yourself to lifelong learning and never look back. Mark Twain once said, “I never let my schooling interfere with my education” and it's true. Most CEOs read 60 books a year. When I began developing an interest in real estate, I devoured every book, article, podcast, and seminar that I could get my hands on. Here are some ideas on how you can continue to expand your knowledge base.

Podcasts
Over the years I found some great education by listening to podcast my favorite being Jason Hartman. He specializes mostly in single family home (SFH) rental properties however the same principles can be applied to other investments like mobile homes, commercial properties, apartments, self-storage, even land contracts. There are some other great REI and motivational podcasts including: The Cardone Zone (Grant Cardone), obviously BiggerPockets, The Real Estate Guys™ Radio Show and Real Wealth Show with Kathy Fettke. Everyone’s time is limited. Whenever I have free time driving in the car or exercising, I launch the iTunes or Stitcher app and listen to a new podcast. This is filling in the time gaps with useful learning.

Seminars and Conferences
Many of the same podcast gurus offer learning seminars throughout the year. Most times the seminar will feature a key note speaker (headliner to get you excited), the podcast host(s) themselves, local market specialists, perhaps financing panels to discuss new lending rules and regulations, networking opportunities, and if you’re lucky some late night entertainment to help add to the fun. I have been to several of these events. What I found to be really beneficial was to go on a bus tour to look at the actual real estate itself. I’ve even bought a house from such a tour. I was able to see firsthand the finished rehabbed product, I asked the turnkey market specialist which items were completed, and also got to know their personalities and their company’s history. This helped lessen any reluctance I may have had in buying more properties. And here’s me networking with one of the groups that I’ve done business with several times over the years.

Go to Local Meet-ups
Another way to get inexpensive exposure to REI is to attend local meet-ups where everyone shares common goals of learning, networking and potentially partnering to do deals together. Typically these are hosted in a bar, restaurant, coffee house or local business establishment. Topics may include: trends in the local markets, types of deals people are doing or interested in doing, tips and tricks of finding deals, financing options, etc. Organizers of the meet-up will have the best outcome if they establish a regular cadence centered around bring in experienced professionals to discuss how they are having success as well as pitfalls to avoid.

Find a Trusted Mentor or Coach
When you are first starting off you may need some hand holding. Find a mentor who is several steps ahead of you. Try to learn from their mistakes and more importantly learn from the right moves they have made. Mentors and coaches are not free. Their time is extremely valuable. I have a coach who actually trained to become a certified executive coach. He is several steps ahead of me and has been able to guide me through rough waters. I gladly compensate him for his time and effort because I see this as an investment in myself. If you don’t have a lot of money, find other ways in which you can be of assistance to your mentor. Maybe it’s “bird dogging” which is essentially finding great deals that you may not be able to do yourself but your mentor can benefit from. Maybe you have some personal networking connections that you can introduce to your mentor. Maybe it’s an unpaid internship. Whatever you can do to get into the world of someone more experienced will ultimately help you get to the next step.

First-hand Knowledge
At some point you will need to actually get over your fear and buy a property. I can remember some of my first properties were the most challenging. There were times when I questioned if this was right for me. Poor planning can be a costly lesson. Each time something goes wrong consider what you could have done to mitigate the risk.
No matter where you start, the first step is to become educated about your investments. Get obsessed, consume every piece of information possible and surround yourself with experienced professionals that have “been there, done that”. You will still make mistakes but use these as stepping stones towards your future success. As the great Conrad Hilton once said, "Success seems to be connected with action. Successful people keep moving. They make mistakes, but they don't quit."

Don’t quit your job…yet
Many of you love your job and will have no plans to quit. The great part of creating passive income is to have your assets working for you while you do other things. For others that can’t wait to leave their job, things can’t happen fast enough. Friends, remember investing is a long term game. Unless you are acquiring a large multi-family apartment or a deal that has cash flow to replace your day job immediately, it’s probably best to keep your day job. It took many years for me to go full time but I promise that if you follow this course and take massive action you can do more than you thought.

Start looking at deals

It’s never too early to start looking at properties. When I first started out I began searching for a simple, boring 3 bed/2 bath SFH which was within a 20 minute driving radius. There are some great sites like Zillow which provide various tools to help assess geographical areas, taxes rates, local economies, crime statistics, even schools and churches, etc. I live in Houston and we have an excellent website www.Har.com. HAR allows you to check a few boxes of your ideal criteria to create a short list of properties to then go see in person. This will save you time. I challenge you to look at 5 -10 serious deals and begin visualizing yourself owning, managing, and most of all profiting each month.

Pro Tip - It is best to run a financial pro forma on each property prior to walking the property. The pro forma will estimate the monthly and annual expenses (principal and interest, taxes, insurance, property management fees, maintenance, vacancy etc.) relative to projected income. The more properties you look at, the better you will become at knowing good ones from great ones. A sample pro forma can be viewed at in the download section of Week Three.

Another word of advice when you’re first starting off is to not become romantic about the property itself; be romantic about the numbers. Many first time buyers view their first deal through the lens of what they would buy for themselves. The fact of the matter is that there are plenty of hardworking people in America that are perfectly content with an "average" but safe place to hang their hat without all the upgraded amenities. Once you have narrowed down your list to the top three properties, contact your realtor to schedule showings. Your realtor should be able to provide you with additional information such as how many days the property has been on the market, offer history, if there are any incentives, or if there are any red flags (sellers disclosures) that you should be aware.

You will find that your strategy will charge over time. When I first started out I looked for “C class” properties because on paper they tended to have greater cash flow and cost less. What I experienced over time was that these C properties attracted C class tenants. Tenant turnover and make ready maintenance quickly ate up my cash flow. As my portfolio continued to grow, I needed to balance out those C properties with higher quality A and B properties. Your strategy will also change over time as your circumstances change. You may find yourself selling those “problem” properties for better ones that meet your objectives.

It's also important to be patient with the process. For my first property, I looked at 50 before I found the right one. Remember that this is a long term buy and hold strategy so you will most likely hold this investment for many years to come.

Passive Income Streams

The last item I want to cover, and I’ll keep it brief, is the concept of passive income since there tends to be some misconceptions especially with newer investors. We’ve all seen the overly excited social media guru in front of some expensive car that they probably rented for the day, preaching how their secret system will bring you riches with very little work. Well my friends I hear to tell you that there is no such thing as a truly passive income stream unless maybe if you’ve acted in a movie several years ago and are still receiving royalty checks. Even having a CD or mutual fund requires action on your part to research it, buy it, monitor the returns, and eventually sell it. And for real estate the fact is that you need to do 95% of the work on the front end and 5% forever after. The good news is that as your investments grow you will have systems in place to do most of the heavy lifting for you. And after you buy your first or second deal the process gets easier. You will have already found a lender, an insurance agent, perhaps a realtor – the systems and processes will become second nature and you will learn from the mistakes that we are teaching you throughout the course as well as ones you learn on your own. Just remember your first deal is always the most difficult but don’t get discouraged. This is a game that most anyone can not only win but win really big. Stay focused and I’ll see you in Week Two!

Hey House Stackers, this concludes the content portion of Week One and I had a blast putting this together and I hope that you learned a lot from it. There are several action items that I want you to take if you haven’t already:

Number 1: Join the private Facebook group this is a way to connect with other like-minded investors within the course

Number 2: Fill out the Personal Financial Statement. I think this is a great foundation for you to better understand your assets and liabilities and it will allow you to set yourself up for how lenders look at you prior to you filling out a loan application

Number 3: Download the guide on how to maximize your credit I think you’re going to learn a lot I know that I’ve learned a lot about my own personal credit when I put this together and I’ve actually put several of these pieces into practice which I’ve already seen make a difference in my credit score.

Number 4: Set up a Google drive or a Dropbox where you can consolidation all of your personal financial statements that you’re going to need when you apply for a loan. This includes your W2s, paystubs, tax returns, etc.

Number 5: complete your Goal Setting Sheet. I do this every year and then I update it on a quarter basis. I love setting goals and it’s a way to measure our success as we go and then finally

Number 6: Start saving for your first deal and the target should be that $30-$40K. Maybe you already have that money saved, put into a separate saving account where you can earmark that for your first deal. And then continue saving. Create that habit. Maybe its saving 10% out of each paycheck and continue to funnel that into that separate saving account for future deals. This concludes Week One. I’ll see you in Week Two!

Hey House Stackers!

Welcome to Week Two where we are going to discuss all of the various types of properties – everything from single family homes to multi-family to commercial properties. By the end of the week you should be able to:

I. Be able to compare and contrast the different types of real estate investments
II. Being able to discern the different parts of a real estate sales contract
1. So the first step is to download your state’s sales contract
2. Familiarize yourself with your state (or state of investment) real estate sales contract
3. What areas do you not understand?
4. Setup a coaching conversation or talk to a realtor about what this is?
5. What are some of the levers you have in this contract for negotiations – price, closing date, riders – financial lending commitment, inspection, appraisal, earnest money, cash or lend, “as is” or special sales contracts, material items left in the building etc., how long is inspection period, what is title company, will you get survey?
III. Keep growing/finding your Real Estate Niche
1. Find a mentor – buy a beer or a coffee
2. Download the Guide on How to House Hack
3. Connect with real estate communities – local meet ups, Bigger Pockets etc.
4. Maybe compare and contrast for the students the differences and utility of local vs online
5. Continue to look at deals!

Happy investing!

- Damon

Single Family Homes – Let’s start by discussing my favorite type of property and that are Single Family Homes. There are multiple reasons why single family makes the most sense for me.

It’s simply what I’m used to. I grew up in a house and I understand how they work much better than I do a large apartment, mobile home park or commercial property. They are simple and boring but they are easy to manage. If something breaks it’s fairly simple to fix it and move on.

I also like the opportunity size and diversity. Currently there are an estimated 100 million detached and attached family homes in the US alone verses 22 million multifamily units. This means that the opportunity size is enormous. So when I hear would be investors say that there are no good properties left I just cringe. All you need is a few rentals to get you started.

The other important factor is that the market is extremely fragmented. It is incredibly difficult for Wall Street firms to swoop in and not only acquire a lot of single family properties all at once but also manage that many individual properties. This leaves the door wide open to you and me. During the Great Recession Warren Buffet was asked his opinion on real estate. He said, “If I had a way to buy a couple hundred thousand single family homes and had a way to manage them…I would load up on them.” This is arguably the greatest investor of all time practically giving you his endorsement.

The other main factor that is appealing is the cost. According to the National Association of REALTORS the median sale price for existing homes in the US was roughly $295,000 in June 2020. (https://www.fool.com/the-ascent/research/average-house-price-state/ )It’s important to note that this number is also takes into account higher cost areas like Hawaii, California, and New York. If we look areas where I like to invest like Tennessee the median cost is $191,000 which means that you can easily find properties in the $140 to $160K range. So for our example if we use $150K and you put 20% down then you’re into the game with $30K plus closing costs. $30K is much more manageable than trying to take down a $3 million multifamily for your first deal. I’m not saying to ignore a longer term goal of building up to a larger deal, I’m simply saying that your first deal is closer to being within reach that some might expect.

The final reason I like single family is the geographic diversity. Perhaps you’ve heard the advice of not having all of your eggs in one basket? Well, I tend to think of my portfolio as a mutual fund of investments spread out over a large area. It is made up of various commodities like steal, wood, petroleum products, concrete, etc. and its spread out geographically where the numbers make the most sense. If an area becomes more challenging like it did when Atlanta saw huge appreciation several years back, I have the option to sell that property, and 1031 exchange, which we’ll discuss in Week Six, it into another property in another location where the numbers do make sense. This also helps protect you in a down economy when larger employers begin cutting jobs. This brings me to the next pro tip which is:

Pro Tip – Never invest in an area where there is just one large industry or one employer. I’ve seen it time and time again where the local economy is tied to either a factory or company that employs half the town. What happens when that employer downsizes or even worse goes out of business? It takes the whole town with it. If your tenants are all employed by the company or industry its lights out for you.

Let’s discuss 2-4 unit properties. These are duplexes, triplexes and 4 plexes and there are several advantages of types of properties. One of the reasons these are interesting is that they are still considered to be in the single family category in the eyes of Fannie Mae and Freddie Mac financing. This means betters terms and better rates verses commercial financing which are properties with 5 doors or more. The other reason these can be appealing to newer investors is that you can live in one of the units while renting out the others. This is a great house hacking tip for those who want other people to pay for their mortgage. Savvy college kids who do this to avoid paying rent for 4 years. I even hear of people moving out after a period of time and keep the property going with the same financing in place although this may not be allowable with your lender. In closing, these types of properties can be a great for first time investors.

Short Term and Vacation Rentals

Investing in short term and vacation rentals can not only be a great investment but can also double as a vacation property when you need to get away. I can recall growing up we went to Myrtle Beach every year for vacation. For several years we stayed at a condo resort that had several amenities like pools, restaurants, it was close to the beach and shopping and came with a golf cart that my brother and I would take off road for kicks. The reason we stayed there for so many years was the consistent experience we had. And here is me with my dad at the condo.

If you are considering this as a viable option as with all real estate, location matters. Slide 16 With the advent of sites like Airbnb and VRBO, it helps streamline the process by providing advertising worldwide while adding some insurance protections since short term rentals have much higher tenant turnover than a traditional rental. Additionally this is a higher touch business since you or your property managers with need to be in constant communications with guests coming and going.

Pro Tip – One strategy that I used was to rent a house, furnish it, and then I put it up on Airbnb. Slide 18 Here’s the actual property that I used. The cost of entry was less than $10K since all I needed first month’s rent, the security deposit, and then I needed to furnish the property. I was quickly able to take pictures, add a description of the location and amenities, and then posted it on Airbnb. I was able to begin renting out the property almost immediately but it was more work than a rental since I had not outsourced the tenant communications which is a critical part of running the business. FYI this can be creating a job for yourself if you’re not careful. The major piece that you need to tackle is the daily housekeeping and the maintenance if anything goes wrong. Although this cash flowed better than any one of my rentals I stopped doing it because it in direct conflict of my goal to create passive income.

Let’s talk a bit about student housing. There are definitely some pros and cons and we’ll start with the positive aspects first. First off colleges and universities create demand for housing year over year and most have been around for several decades so they are a pretty safe bet. As long as class is in session, and I mean physical class not online, there will be students lined up to meet that demand. Typically there is limited real estate on and around campus so this creates limited supply. Many students tend to walk to class and prefer to be near the action so finding properties within the proximity of campus, restaurants, bars, coffee shops and other attractions will be key. Once students find a great property in a great location they or their friends will renew next year’s lease well before the new year.

Aside from favorable supply and demand, many times the parents of the students will actually co-sign and pay or help pay for rent. The parents will also be on the hook if there are damages that exceed the security deposit.

The other interesting piece is that landlords tend to rent space by the room which can drastically increase cash flow. For example if you have a 4 bedroom house you can charge $300 per room per month for a total of $1200 where that same house would maybe only rent for $1000 a month if you were to rent it to a family.

Now let’s talk about the downside. Typically schools have limited summer classes so assigning a 12 month lease may get some push back if your tenants are only there 9 months. This type of schedule is prone to students wanting to sublet the space to other people for the summer. You as the landlord will need to come up with a compromise for this situation.

Now’s let’s discuss the big challenge and that’s the party situation. Once alcohol makes it’s way in all bet’s are off. Think of the countless movies like Revenge of the Nerds, Old School and Animal House. The only person that is not having fun is the landlord who owns the trashed house. This is where tenant screening comes into play. You need to have a conversation, without sounding like buzzkill, that everyone needs to respect the house and if they can’t maybe your property isn’t the right one for them.

The final challenge that recently came up with COVID is how our world is transforming. With the pandemic schools and businesses went online. Anything that could be done remotely did. Now I’m a firm believer that we are social beings and we are already going back to in person activities. But this is a risk that can affect student housing investments in the future so be sure to take into account all of the pros and cons before jumping into this type of asset class.