Investment Strategy for Small Multi-Family

[Jacob Desch]

Hi all, 

I recently came across an Realtor/Investor on YouTube who shared their simple, but seemingly effective investment strategy and I was wondering if anyone else had heard of/ uses this strategy as well....

The scenario was that they initially bought a SFH or duplex and used all net cash flow to pay down the debt on that property and then once they paid that off they purchased another and used the net cash flow from both to pay down the debt on the second property, then bought a third and used net cash flow from one and two to pay down three and so on...

The snowball effect is clear here but it seems that it would take quite a bit of time to get things going especially if cash flow from the start is only $100 or less a door.

I have seen other investors use all available lines of credit (personal, business, hard money loans) in addition to cash flow to pay off properties as quickly as possible to then increase cash flow and start buying up property at a very high rate. 

Thoughts? 

Best, 

Jacob 

[Michele Wax]

I think that it is a good idea if you are going slow and not in a hurry.  But I would prefer to move faster.....Debt is cheap....Make your money make money.