How do I get built-in equity on a buy-and-hold property?

2 Replies

Hi,

I'm a new investor looking to start buy-and-hold investing.

One of the challenges I'm finding is trying to find built-in equity, which I know many experienced investors preach for buy-and-hold strategies.

I've been pretty unoriginal in how I've been looking for properties; mostly through the MLS. I'm wondering if in other investors' experience, if it's possible (or practical to use this as my strategy) to find a good buy-and-hold with some amount of built-in equity off the MLS.

Unfortunately being based in CA, I'm currently forced to invest out of state, which makes me wary of buying a property in need of rehab.  I'm also looking for more of a passive investment anyway (I'd use a property manager), so managing a rehab or sending out mailers isn't really something I want to do.

Sorry if it's a newbie question.  Thanks!

you can always find worn out landlords that just want out. You can get free equity there. We bought 32 apartment units early this year and though it was not huge, the appraisal came it at about a 10% free equity. We basically bought rented apartments for 90% of appraised value. 

We own in central valley, CA. I love buying out here. While we have 7 houses, (3 back east), this is an awesome areas. We buy off the mls with a realtor.  We have done very well getting instant equity through buying foreclosures and short sales. For us, it isn't without work. The foreclosure was a dump and we had to get it fixed up (we didn't have time to do it ourself so we hired a contractor/handy man (expensive!! although still cheaper) and the short sales have tons of paperwork! 

There are definite strategies but no matter what they all have MOMENTS.

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