Peter's Blog

Oil Change Economics

When was the last time you changed your own oil in your car? For me, it's been over 20 years.

Did you know that we have over 200 million cars in this country? That means there are at least 400 million oil changes every year. So who's changing your oil?

EZ Lube, JiffyLube, etc. . . .

If an oil change takes 20 minutes, than an employee can do 24 oil changes per day. At 260 work days per year, that's 6,240 oil changes per employee per year. You can see that there must be a lot of oil change mechanics in America.

Yes, it would take over 64,000 mechanics to do 400 million oil changes per year.

But how many people actually change their own oil? Let's say that 25% of all Americans change their own oil. That means that 48,000 people are actually employed annually just to change oil.

So what is "Oil Change Economics"?

When taxes are increased for America's highest income bracket, they respond by spending less. No, they're still not going to change their own oil, but they will spend less on everything else. When they spend less, more companies make less, so they limit overtime, cut salaries or lay people off. As these employees begin to feel the pressure of making less money, more of them will be doing their own oil changes.

As the percentage of people who change their own oil goes from 25% to say 50%, we just lost 16,000 oil change mechanics jobs.

Process:

Domain names are becoming 21st century real estate!

You've read many blogs on getting your own domain name or maybe you already have a domain name, but did you know that Domain names are becoming 21st century real estate (Bob Parsons, CEO and founder of domain registration company GoDaddy.com)?

In 1995, I bought my first computer (windows 95 - anybody remember this one?). I wanted to know more about computers and I really wanted to know what all the hype about this "Information Superhighway" that everybody was talking about. I even had a subscription to aol, dial-up. It was horrible. I quickly learned that aol (sucked) had too many restrictions and charged more money for less service.

I switched a couple of ISP's until I found one that I liked. The benefit of this was that it made me realize that with each ISP change, my email would also change. So I did something that would ensure a lifelong email address. I registered my last name, hence my email address became myfirstname@mylastname.com I knew I was never going to change my name, so I would never have a need to change my email address (if you're a single woman and plan on getting married, this may not work for you).

This in turn allowed me to think of domain names as real estate on the Internet and as a result, I went and registered a whole bunch of names that I might have had some use for (either at that time or sometime in the future). 10 years have passed since I've done this, and now I see it is nearly impossible to find a good available domain name. Luckily I thought ahead. I still have those names. I use some, others are just waiting to be used (or sold if they wind up being valuable).

Recently, I read a blog that asked about single property domain names. I recommended that if you are listing a commercial property, it might not be a bad idea to register the address (ex: http://www.427bedfordroad.com/) chances are that the buyer may also want to buy the domain name. Or maybe you can use the domain name to advertise the property and as an incentive to the buyer include the website as a bonus.

Well, if it's not too late already, I recommend that you at least go and register your fullname.com. I see more and more realtors who have already done it, but for years now I've seen many celebrities and politicians who have done it. Good luck.

Real Estate, is it the right investment for you?

Do you feel like you missed the last real estate boom! Who knows when the next boom is going to occur. You can't wait another 5, 10 or 15 years. You want to get in on the action now! You've heard dozens of stories how your friends and their friends made a ton of money with real estate.

Did you miss out, or not?

Based on the stories you heard and what was happening in the real estate market, many people began to buy real estate on speculation. Of those who did (in 2004 or 2005), many wish they'd never had. Unfortunately, many of these people, instead of making money with real estate, are now facing foreclosure, bankruptcy or other serious financial problems.

Now, I bet you feel better that you didn't invest in real estate (at least not in the last couple of years).

But was is better?

The answer is not always clear cut. I purchased a property at the height of the market (in November of 2005). Did I make a mistake? Am I facing financial trouble? Actually, quite the opposite. Within 2 years of my purchase, the value of my investment jumped by over 50%. My initial investment was 25% of the total purchase price, which brought my 2 year return to more than 200%.

How was I able to get such great returns, while others who bought at the same time are facing foreclosure?

If you need a quick simple gimmick on how to make money in real estate, you'll have to watch those late night infomercials. BTW, I've never seen one, so I couldn't tell you if they work or not.

So how did I do it?

The simplest answer that I can give, is that I understood the real estate market, I have quite a bit of real estate experience, and I was aware of the type of property that I was buying.

Can anybody do this? Yes. Anyone who has the knowledge and experience or anyone who is working with someone that has the knowledge and experience. I didn't mention, that I have a partner in this investment. My partner has limited knowledge of the real estate business. However, my partner was knowledgeable enough to know not to attempt this on her own, but to partner with someone who already had the knowledge and experience.

BTW, my partner Lynda Shenkman Curtis, is a photographer. She's a great photographer, she took this head shot of me. Like it?

Some things in life are just not as simple as they appear. Real estate is one of those things that you'd better have the knowledge and experience or partner with someone who does. Otherwise, don't do it! The lure of easy money can get you into foreclosure, financial stress or worse, bankruptcy.

So, is real estate the right investment for you?

If you're still not sure, send me an email. Maybe I could help you decide. If you're in Westchester County or NYC area and are looking for an experienced and knowledgeable partner, email me.

Sincerely,
Peter Z. Nikic
Licensed Real Estate Broker & Investor (NY)
Contact Peter Nikic
(914) 804-0037

Local Agent Earns REALTOR e-PRO® Certification
April 1, 2008 -- Peter Z. Nikic has successfully completed the REALTOR e-PRO course to become one of a select few real estate professionals to earn the prestigious certification offered through the National Association of REALTORS®

The REALTOR e-PRO certification course is an educational program unlike any other professional certification or designation course available, comprehensive and interactive. It is specifically designed to provide real estate professionals with the technology tools needed to assist consumers in the purchase or sale of a home.

With more than 70% of consumers beginning their real estate research on the Internet, e-PRO certified agents have the experience and expertise to meet the demands of today's buyer and seller.

Do you want to be an e-PRO? Click on the link for a video tour. If you register using this link, I will receive $30.00 as a referral and you will save $25.00 on your enrollment!



Enjoy the class!

Peter Z. Nikic
Broad & Bailey, Inc.
(914) 804-0037