'I was a millionaire before I did Terminator': Arnold Schwarzenegger told Grant Cardone how he made millions before becoming a movie star — and it wasn’t from bodybuilding

‘Arnold, listen to me’

“There was a real estate woman by the name of Olga,” Schwarzenegger recalled. “She was from Lebanon, and she was Danny DeVito’s height. She said to me, ‘Arnold, listen to me, you need income property. When you have a house or when you have a condominium, then you have to pay the mortgage, you have to pay for the expenses, but I find you a six-unit apartment building that has an owner's unit in front.’”

Schwarzenegger recounted that the apartment building Olga found cost $240,000. He emphasized that this was back in the 1970s.

For context, the median price of houses sold in the U.S. in 1975 was around $39,000.

Although the apartment building represented a significant investment, it proved to be highly worthwhile for Schwarzenegger.

“Two years later, I got $400,000 when I sold the building — I put only 27 and a half down,” he revealed.

In other words, Schwarzenegger made a tidy profit of $160,000 (subtracting $240,000 from $400,000). If the $27,500 down payment was his sole investment in the property (meaning the rental income covered mortgage payments and other expenses), the return on that investment would be 481.8%, not including the additional rental income he may have collected along the way.

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Now and then

Given Schwarzenegger’s success with that investment, one might wonder if it's feasible to replicate that strategy today.

Well, the landscape has evolved significantly since the 1970s, with skyrocketing home prices demanding substantially higher investments.

While the fundamentals of real estate investment remain sound — you can purchase an apartment building and earn rental income — aspiring investors must navigate a market where entry costs have surged, posing greater challenges for those lacking substantial capital.

To put things in perspective, the median home price in the U.S. had reached $417,7000 in Q4 of 2023.

Apartment buildings with multiple units can command significantly higher prices.

However, these days, you don’t have to be a landlord to invest in real estate. Publicly traded real estate investment trusts (REITs) offer easy access for individuals seeking exposure to the sector. At the same time, there are also crowdfunding platforms that allow you to become part owners of diversified real estate portfolios.