Why Real Estate?
Rental Property Investor · Brooklyn, NY · Member since 2014 · 722 posts · 1k+ votes
Why Real Estate?
Most Popular Reply
Denver, CO · Member since 2014 · 56 posts · 68 votes
11yWhat other form of investing lets you contribute 5% of an asset's value, but let's you keep 100% of the increase in equity? Even after you graduate to 20% down/investment property financing, $100k buys you a $500k asset, if it improves 3%, you just made 15% on your cash in appreciation alone. If it's a decent property operating at a 7% cap you could probably take another $5-8k a year in cashflow which push returns on investment into the low 20% range....and that's on a pretty marginal property.
Next year I'm selling off the rest of my personally-held stocks, the only thing left in that market will be my employer funded 401k. At that point I should have everything working for me in real estate.
My hopes and dreams? To own a nice portfolio and keep the Debt/Equity around 1:1.
63 Replies
- Investor · Trabuco Canyon, CA · Member since 2015 · 40 posts · 35 votes11y
Great question @Jonathan Twombly!!
I've latched on to the IDEAL acronym when thinking about the "why" REI question.
I = Income (cash flow)
D= Depreciation
E= Equity
A= Appreciation
L= Leverage
I've seen this model work beautifully for my father and I'm looking to take it to the next level. The fact that you have "knobs" to turn as you adjust to changes in the economy is very comforting vs. many other asset classes.
Best of luck!
Gil
- 11yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
good question. my perspective is:
1. Very easy for most folks to understand.. buy low sell high.. buy and rent. or buy and fix up and sell.
2. HUGE exposure through national media ,, Infomercials, the rise of the TV Reality shows that then spawned the aftermarket business of teaching folks the fast track to rich's ( for a price)
3. Leverage as stated
4. The incredible low bar of entry in many parts of the US... IE affordable to virtually anyone who has a job can save a little and has not butchered there credit because of inability to manage their personal funds.
5. Myriad of off shoots to RE... IE Re Brokerage which many make big bucks at then roll into investing and developing and lending etc. ( my path personally)
5.5 Of those Myriad of options they could include RE sales,,, Lending,, Note investing, Property management, Buy and Hold ( most popular) Fix and flip, New construction, AG , Timber , Oil and Gas leases, there is Many ways to skin a cat in the RE investing world.
6. BP with 200 to 300k members who at least are interested enough to sign up.. that right there is 1% of the entire country...
7. Information age internet etc. access to information for the beginner investor that just 20 years ago you really had to know how to work a court house and that was a major bar to entry in the day.
- Houston, TX · Member since 2013 · 481 posts · 189 votes11y
Great question! I'm writing my very 1st book that will address this question. Below is the excerpt from one of the chapter that will answer your question
"Look around you, if you want to become wealthy, at one point you will involve in owning real estate, one way or another. There is no way around it. Real Estate is the best vehicle to protect, preserve, grow your wealth and pass it down to the next generation"
- Real Estate Broker · Chicago, IL · Member since 2013 · 6k+ posts · 5k+ votes11y
I invest in real estate for many reasons.
- I am passionate about it so working in or on my business is not "work" to me.
- I like the control. Where or how I buy has a direct impact on my profit. How I run the day to day of my business has a direct impact on my profit.
- The ability to leverage
Second City Real Estate4.821 Reviews - Visalia-Fresno, CA · Member since 2009 · 1k+ posts · 863 votes11y
60% of your net worth is in Real Estate or 60% of your income?
- Northern, CA · Member since 2014 · 674 posts · 444 votes11y
I've been in the stock market 100% but have wanted to invest in real estate since I was a teenager. It was pretty obvious to me then how it could change my life financially. However, I went the typical route of college and a professional career and i'm only now getting back to real estate. Real Estate is my path to retirement for my wife and I, but the stock market will continue to play a big part in wealth building. One nice benefit to the stock market is the ability to keep cash at work while waiting for the next RE deal.
- Stockbridge, GA · Member since 2015 · 159 posts · 33 votes11y
Originally posted by @Jonathan Twombly:
Why invest in real estate?
After all, there are lots of things to invest in -- stocks, bonds, precious metals, collectibles. What makes real estate so attractive to you? Is it because it's tangible -- you can ride by and look at your investment? Is it because that's what you heard rich people invest in? Because it's "passive"?
If you're already a successful real estate investor, why did you come this route?
If you're hoping to enter this field, why? Why not all the other ways you could make money or invest your extra savings?
What are your hopes and dreams about owning investment property?
Hello Jonathan,
Real estate investing provides a lot flexibility to those interested in the industry. There are several ways to obtain a good return on your investment.
- Investor · Orlando, Fl. · Member since 2014 · 19 posts · 9 votes11y
Why Real Estate? Because it never goes to zero and it always generates income, even in a down market.
- Developer / Investor · Denver, CO · Member since 2014 · 64 posts · 31 votes11y
Originally posted by @Frank Jiang:
Leverage Control.
Real Estate is one of the few asset classes where you have direct control over your leverage and thus your risk/return profile.
This is one of the primary reasons I chose real estate. I would add that I dont know of any other investment where you get 100% control for ~25% of the price of the asset.
Plus, as a rehabber/developer, I love the idea of providing homes to people (I put myself through college as a Framer.) The mission of my company, Spartan Home Buyers, is "improving lives through real estate."
Every time we take a delapitated home and rehab it into a brand new home, we provide benefits to the sellers (cash in their pocket and our relocation services), buyers (a new home), the neighborhood (increased property values), our business partners (help them grow their businesses), and our investors (great returns.)
It's hard to improve lives through Apple stock, although I do own some. :-)
- 11yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
very common misnomer Real Estate can and does go to zero and actually goes negative.
many ways.. look at blighted inner cities.. many properties have zero value.. environmental issues on a property.. etc... but generally speaking I hear ya.. but I think this is one thing that has led many investor to lose lots of money over the years.. thinking that RE is a SURE thing and they can't lose... nothing can be farther from the truth.
- Rental Property Investor · Phoenix/Lima, Arizona/OH · Member since 2012 · 4k+ posts · 4k+ votes11y
@Jonathan Twombly - I chose this path because it was the only path that made sense to me...
- Contractor · Queen Creek, AZ · Member since 2014 · 155 posts · 37 votes11y
Originally posted by @Jonathan Twombly:
Why invest in real estate?
After all, there are lots of things to invest in -- stocks, bonds, precious metals, collectibles. What makes real estate so attractive to you? Is it because it's tangible -- you can ride by and look at your investment? Is it because that's what you heard rich people invest in? Because it's "passive"?
If you're already a successful real estate investor, why did you come this route?
If you're hoping to enter this field, why? Why not all the other ways you could make money or invest your extra savings?
What are your hopes and dreams about owning investment property?
Why real estate you ask, well for my husband and I it has given use a life without a mortgage at a young age, we have been mortgage free since we were 30 years old (now 37) and live in a house that would have a mortgage of $1500 per month but we don't, we have been "live in flippers" since 2008 and have been paying all in cash, we have made our $100k investment into $340k in 4 years buy increasing the equity of each house we have lived in and with the properties we have now. Since 2008 till now we have lived in 3 different houses and have 2 flip and hold properties which we get $1500 per month in rental income.
Honestly real estate is not for everyone especially if you have no patience and want everything now, it takes time and a lot of hard work and for us a lot of sacrifices, but we are focused in our future, It has been very exhausting and very rewarding we love ugly properties and just love how beautiful we leave them, it's like we touch and it turns into gold. ;)
We are working now on the house we have been living in for the last 2 years, we are ready to flip it and sell it, since an opportunity has popped up we are going to buy and live in my parents house which they don't want anymore we are getting it for $110k because it needs a lot of work, but ARV it can sell for $190k to $200k, it only needs about $25k to get it beautiful again. We are planning to cash out all our properties this year in hopes to start doing some flips and new construction more often instead of every 2 years. Wish us luck.
- Investor · Orlando, Fl. · Member since 2014 · 19 posts · 9 votes11y
@Jay Hinrichs
very common misnomer Real Estate can and does go to zero and actually goes negative.
many ways.. look at blighted inner cities.. many properties have zero value.. environmental issues on a property.. etc... but generally speaking I hear ya.. but I think this is one thing that has led many investor to lose lots of money over the years.. thinking that RE is a SURE thing and they can't lose... nothing can be farther from the truth.
**** Sure, I get the drift. Sounds like you're looking at it from a different perspective though. As a developer I'm sure you face issues I've yet to encounter. You play in a different ballpark. I'm prob small time in your book. But as a SFH buy and hold or buy and flip guy who is very careful about the when / where / how much, I've never had a problem. Had a scare in 2008 like most people but buying right and planning ahead served us well. Short of a national disaster it's hard for a small time SFH real estate investor to get hurt if they have a little knowledge, buy right and plan ahead. But like I said, I get your drift. And wish you well!
- Rental Property Investor · Brooklyn, NY · Member since 2014 · 722 posts · 1k+ votes11y
Originally posted by @Scott Lewis:
Originally posted by @Frank Jiang:
Leverage Control.
Real Estate is one of the few asset classes where you have direct control over your leverage and thus your risk/return profile.
This is one of the primary reasons I chose real estate. I would add that I dont know of any other investment where you get 100% control for ~25% of the price of the asset.
Plus, as a rehabber/developer, I love the idea of providing homes to people (I put myself through college as a Framer.) The mission of my company, Spartan Home Buyers, is "improving lives through real estate."
Every time we take a delapitated home and rehab it into a brand new home, we provide benefits to the sellers (cash in their pocket and our relocation services), buyers (a new home), the neighborhood (increased property values), our business partners (help them grow their businesses), and our investors (great returns.)
It's hard to improve lives through Apple stock, although I do own some. :-)
Scott, I like this answer. Real estate is a field that allows you to "do well and do good" at the same time, unlike owning stocks. I think providing housing, especially for medium and lower-income people, is a noble thing to do. And there is nothing wrong with making a profit on it so you can live well and go on to create/rehab some more housing for everyday people!
- Rental Property Investor · Brooklyn, NY · Member since 2014 · 722 posts · 1k+ votes11y
Originally posted by @Lucero Sanchez:
Originally posted by @Jonathan Twombly:
Why invest in real estate?
After all, there are lots of things to invest in -- stocks, bonds, precious metals, collectibles. What makes real estate so attractive to you? Is it because it's tangible -- you can ride by and look at your investment? Is it because that's what you heard rich people invest in? Because it's "passive"?
If you're already a successful real estate investor, why did you come this route?
If you're hoping to enter this field, why? Why not all the other ways you could make money or invest your extra savings?
What are your hopes and dreams about owning investment property?
Why real estate you ask, well for my husband and I it has given use a life without a mortgage at a young age, we have been mortgage free since we were 30 years old (now 37) and live in a house that would have a mortgage of $1500 per month but we don't, we have been "live in flippers" since 2008 and have been paying all in cash, we have made our $100k investment into $340k in 4 years buy increasing the equity of each house we have lived in and with the properties we have now. Since 2008 till now we have lived in 3 different houses and have 2 flip and hold properties which we get $1500 per month in rental income.
Honestly real estate is not for everyone especially if you have no patience and want everything now, it takes time and a lot of hard work and for us a lot of sacrifices, but we are focused in our future, It has been very exhausting and very rewarding we love ugly properties and just love how beautiful we leave them, it's like we touch and it turns into gold. ;)
We are working now on the house we have been living in for the last 2 years, we are ready to flip it and sell it, since an opportunity has popped up we are going to buy and live in my parents house which they don't want anymore we are getting it for $110k because it needs a lot of work, but ARV it can sell for $190k to $200k, it only needs about $25k to get it beautiful again. We are planning to cash out all our properties this year in hopes to start doing some flips and new construction more often instead of every 2 years. Wish us luck.
That's awesome. Congratulations on your success so far, and even more in the future!
- Investor · Vista, CA · Member since 2015 · 163 posts · 58 votes11y
In addition to what everyone else is saying (i.e the IDEAL acronym), I'm looking to retire early and REI seems like the best vehicle. Everyone has different goals about financial independence, retirement, and supplemental income. I'm looking to create $3000-4000k/mon in CF within the next 3-4 years. I have a degree in chemical engineering and work "passively" in REI.
After working for 10 years in the corporate world, I learned the difference between a wage-slave and real wealth and have devoted my efforts to financial independence. It's shocking that a majority of folks are wage-slaves. A high paying W-2 really doesn't mean that much in terms of real wealth. I read Jacob Lund Fisker's works on this topic and this shifted my perspective on money, lifestyle, and financial choices. Next Rich Dad was the final nail in the coffin. I'm now committed to minimizing my consumption and maximizing my savings to achieve independence. Streamlining finances is a passion of mine.
Back to REI, I've found this is my vehicle of choice. I'm not interested in building an empire or being a millionaire. I've trained myself so that if I were to have a significant increase in cash flow and net worth, I don't think there's much that would change in my life as far as spending habits. Funny, now that I have a good understanding and a financial education, I don't care to spend money.
Here's to your wealth!
Zach
- Contractor · Queen Creek, AZ · Member since 2014 · 155 posts · 37 votes11y
Originally posted by @Zach Adams:
In addition to what everyone else is saying (i.e the IDEAL acronym), I'm looking to retire early and REI seems like the best vehicle. Everyone has different goals about financial independence, retirement, and supplemental income. I'm looking to create $3000-4000k/mon in CF within the next 3-4 years. I have a degree in chemical engineering and work "passively" in REI.
After working for 10 years in the corporate world, I learned the difference between a wage-slave and real wealth and have devoted my efforts to financial independence. It's shocking that a majority of folks are wage-slaves. A high paying W-2 really doesn't mean that much in terms of real wealth. I read Jacob Lund Fisker's works on this topic and this shifted my perspective on money, lifestyle, and financial choices. Next Rich Dad was the final nail in the coffin. I'm now committed to minimizing my consumption and maximizing my savings to achieve independence. Streamlining finances is a passion of mine.
Back to REI, I've found this is my vehicle of choice. I'm not interested in building an empire or being a millionaire. I've trained myself so that if I were to have a significant increase in cash flow and net worth, I don't think there's much that would change in my life as far as spending habits. Funny, now that I have a good understanding and a financial education, I don't care to spend money.
Here's to your wealth!
Zach
I know what you mean, we are working on establishing a steady flow as well on free and clear rental properties of at least $5k per month by the time we are 50 or hopefully sooner, we are not interested in wealth but if it comes than it's welcomed ;) but honestly we want to be able to sleep in! Lol.
Question what are you doing now to be able to reach your goal with in the next 3 to 4 years?
- Contractor · Queen Creek, AZ · Member since 2014 · 155 posts · 37 votes11y
Originally posted by @Jonathan Twombly:
Originally posted by @Lucero Sanchez:
Originally posted by @Jonathan Twombly:
Why invest in real estate?
After all, there are lots of things to invest in -- stocks, bonds, precious metals, collectibles. What makes real estate so attractive to you? Is it because it's tangible -- you can ride by and look at your investment? Is it because that's what you heard rich people invest in? Because it's "passive"?
If you're already a successful real estate investor, why did you come this route?
If you're hoping to enter this field, why? Why not all the other ways you could make money or invest your extra savings?
What are your hopes and dreams about owning investment property?
Why real estate you ask, well for my husband and I it has given use a life without a mortgage at a young age, we have been mortgage free since we were 30 years old (now 37) and live in a house that would have a mortgage of $1500 per month but we don't, we have been "live in flippers" since 2008 and have been paying all in cash, we have made our $100k investment into $340k in 4 years buy increasing the equity of each house we have lived in and with the properties we have now. Since 2008 till now we have lived in 3 different houses and have 2 flip and hold properties which we get $1500 per month in rental income.
Honestly real estate is not for everyone especially if you have no patience and want everything now, it takes time and a lot of hard work and for us a lot of sacrifices, but we are focused in our future, It has been very exhausting and very rewarding we love ugly properties and just love how beautiful we leave them, it's like we touch and it turns into gold. ;)
We are working now on the house we have been living in for the last 2 years, we are ready to flip it and sell it, since an opportunity has popped up we are going to buy and live in my parents house which they don't want anymore we are getting it for $110k because it needs a lot of work, but ARV it can sell for $190k to $200k, it only needs about $25k to get it beautiful again. We are planning to cash out all our properties this year in hopes to start doing some flips and new construction more often instead of every 2 years. Wish us luck.
That's awesome. Congratulations on your success so far, and even more in the future!
Thank you same to you. :)
- Investor · Vista, CA · Member since 2015 · 163 posts · 58 votes11y
Originally posted by @Lucero Sanchez:
Originally posted by @Zach Adams:
In addition to what everyone else is saying (i.e the IDEAL acronym), I'm looking to retire early and REI seems like the best vehicle. Everyone has different goals about financial independence, retirement, and supplemental income. I'm looking to create $3000-4000k/mon in CF within the next 3-4 years. I have a degree in chemical engineering and work "passively" in REI.
After working for 10 years in the corporate world, I learned the difference between a wage-slave and real wealth and have devoted my efforts to financial independence. It's shocking that a majority of folks are wage-slaves. A high paying W-2 really doesn't mean that much in terms of real wealth. I read Jacob Lund Fisker's works on this topic and this shifted my perspective on money, lifestyle, and financial choices. Next Rich Dad was the final nail in the coffin. I'm now committed to minimizing my consumption and maximizing my savings to achieve independence. Streamlining finances is a passion of mine.
Back to REI, I've found this is my vehicle of choice. I'm not interested in building an empire or being a millionaire. I've trained myself so that if I were to have a significant increase in cash flow and net worth, I don't think there's much that would change in my life as far as spending habits. Funny, now that I have a good understanding and a financial education, I don't care to spend money.
Here's to your wealth!
Zach
I know what you mean, we are working on establishing a steady flow as well on free and clear rental properties of at least $5k per month by the time we are 50 or hopefully sooner, we are not interested in wealth but if it comes than it's welcomed ;) but honestly we want to be able to sleep in! Lol.
Question what are you doing now to be able to reach your goal with in the next 3 to 4 years?
Lucero -
I'm shooting for 4-5 SFHs and a multy-family/Apt complex. I'm not looking to flip or anything like that, but am targeting a $30-35k/year in savings from W-2, taxes, and current CFs to put into RE. Looking for a higher paying job to bump this number up too as well as ways to reduce living expenses. Trying to be creative as I go!
How about yourself? sounds like the live in flip is working well for you?
Zach
- Rental Property Investor · Brooklyn, NY · Member since 2014 · 722 posts · 1k+ votes11y
Originally posted by @Zach Adams:
In addition to what everyone else is saying (i.e the IDEAL acronym), I'm looking to retire early and REI seems like the best vehicle. Everyone has different goals about financial independence, retirement, and supplemental income. I'm looking to create $3000-4000k/mon in CF within the next 3-4 years. I have a degree in chemical engineering and work "passively" in REI.
After working for 10 years in the corporate world, I learned the difference between a wage-slave and real wealth and have devoted my efforts to financial independence. It's shocking that a majority of folks are wage-slaves. A high paying W-2 really doesn't mean that much in terms of real wealth. I read Jacob Lund Fisker's works on this topic and this shifted my perspective on money, lifestyle, and financial choices. Next Rich Dad was the final nail in the coffin. I'm now committed to minimizing my consumption and maximizing my savings to achieve independence. Streamlining finances is a passion of mine.
Back to REI, I've found this is my vehicle of choice. I'm not interested in building an empire or being a millionaire. I've trained myself so that if I were to have a significant increase in cash flow and net worth, I don't think there's much that would change in my life as far as spending habits. Funny, now that I have a good understanding and a financial education, I don't care to spend money.
Here's to your wealth!
Zach
Having left wage slavery for real estate, I can truly relate. I like the way you are doing things, building it up slowly on your own. Slow and steady really does win the race in real estate, since time is your ally if you buy good deals and hold them. Good luck, and thanks for the comment!
- Investor · New York City, NY · Member since 2015 · 808 posts · 417 votes11y
I will take more of a market based approach vs. a personal one. Personally, I don't really like RE. The market is highly inefficient, people act irrationally much of the time, many variables are hard to quantify and don't get me started on rehabbing or tenants. Its all tough to swallow for someone used to investing and working a full-time job in the much more streamlined world of equities and hedge funds. With that being said I think RE is highly attractive for a number of reasons:
1) Leverage - you can get leverage in different forms for other investments but I don't know many investments where you can get as much leverage on the same terms as RE
2) Efficiency - In many forms the RE market is much less efficient than other forms of investing. From the people selling you assets for a much larger discount than you would get in other markets to the difficulty of dealing with (or finding someone to deal with it) rehabbing or property management, the fact of the matter is the market is a lot less efficient than other markets and until that changes returns will probably be higher for the right strategies.
3) Perception - For many reasons people have a negative view of landlording and many forms of RE in general. As long as this persists in some form or another less people will want to do it thus increasing returns.
4) RE is hard - Real estate investing is hard. Like really hard. Unlike say equities where you can just open an account and go nuts RE has so many things you have to line up, it takes time and the learning curve is steep. Most people who want more instant gratification give up.
5) Tax benefits - The government gives very real benefits for real estate investing.
6) Control - This is actually a double sided benefit. Control sucks because professionals are probably more suited to do most forms of "work" for a property. However, because of varying incentive structures having control over an asset can be very beneficial vs. holding it in some type of public company structure or fund structure where they may have incentives that are not the same as yours all the time or where your return can be somewhat capped by promote structures. Unlike many other assets where the buy-in is too large to buy a whole investment, in real estate the average investor can buy a good sized portfolio.
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- Contractor · Queen Creek, AZ · Member since 2014 · 155 posts · 37 votes11y
Originally posted by @Zach Adams:
Originally posted by @Lucero Sanchez:
Originally posted by @Zach Adams:
In addition to what everyone else is saying (i.e the IDEAL acronym), I'm looking to retire early and REI seems like the best vehicle. Everyone has different goals about financial independence, retirement, and supplemental income. I'm looking to create $3000-4000k/mon in CF within the next 3-4 years. I have a degree in chemical engineering and work "passively" in REI.
After working for 10 years in the corporate world, I learned the difference between a wage-slave and real wealth and have devoted my efforts to financial independence. It's shocking that a majority of folks are wage-slaves. A high paying W-2 really doesn't mean that much in terms of real wealth. I read Jacob Lund Fisker's works on this topic and this shifted my perspective on money, lifestyle, and financial choices. Next Rich Dad was the final nail in the coffin. I'm now committed to minimizing my consumption and maximizing my savings to achieve independence. Streamlining finances is a passion of mine.
Back to REI, I've found this is my vehicle of choice. I'm not interested in building an empire or being a millionaire. I've trained myself so that if I were to have a significant increase in cash flow and net worth, I don't think there's much that would change in my life as far as spending habits. Funny, now that I have a good understanding and a financial education, I don't care to spend money.
Here's to your wealth!
Zach
I know what you mean, we are working on establishing a steady flow as well on free and clear rental properties of at least $5k per month by the time we are 50 or hopefully sooner, we are not interested in wealth but if it comes than it's welcomed ;) but honestly we want to be able to sleep in! Lol.
Question what are you doing now to be able to reach your goal with in the next 3 to 4 years?
Lucero -
I'm shooting for 4-5 SFHs and a multy-family/Apt complex. I'm not looking to flip or anything like that, but am targeting a $30-35k/year in savings from W-2, taxes, and current CFs to put into RE. Looking for a higher paying job to bump this number up too as well as ways to reduce living expenses. Trying to be creative as I go!
How about yourself? sounds like the live in flip is working well for you?
Zach
Like I mentioned on Jonathan Twombly post, we are planning to cash out all our properties this year which should leave us with $340k in our pockets by the end of the year, with that money we are going to buy my parents house hopefully by next month (we got so lucky that they want to sell, it's in bad shape and my parents don't want to invest in it, they don't want anything to do with real estate) we offered to buy it for as is value which is $100k and they accepted but we will end up paying around $110k because we took over there mortgage payment of $960 this month will be our 3rd month paying their mortgage and hope to be the last one because our house should be ready real soon to put up for sale in our area houses are under contract in about 15 days so fingers crossed. The house we live in now we got it 2 years ago it was a short sale we got it for $157k and so far we have invested $10k might need another $3k to have it ready this month, this house will be listed no less than $250k that's around how much other homes exactly like ours have sold for in the last few months in our area.
So purchased for $157k invested $13k so we should be making around $60k in profit after all closing fees and what not. So we should get our $170k investment back plus $60k A total of $230k in our pockets.
Next we plan to sell a rental property that we got back in 2011 we got it for $40k invested $20k and now it can sell for $150k so after we sell this one we should have around $340 $360k in our pockets to really start to get the ball rolling.
So let's say $350k - my parents house $110k = $240k to start rolling.
We plan to build a house and sell it or if we can find other flips than go for it, we want the $240k to grow once it has gotten to $500k than from every 2 to 3 flips or every 2 new construction from that profit buy a house that we can hold for rental income and continue with that plan till we reach our goal of no less than $5k per month. Sorry I did such a huge story but I just get so excited! ")
Let me know what you think. Thanks
- Investor · Riverside, CA · Member since 2014 · 351 posts · 220 votes11y
Love this topic..... I read a few weeks ago that Warren Buffet got a multi billion dollar commitment to purchase SFR's all around the counrty. I would like to ask him "why" I think he would say it's simple, because he can..... because the hedge fund would...... invest in a 50/60 % cltv position on an asset in the United States of America that simple. I know of few or no banks that will lend me money to buy gold, stocks, soy bean futures, and alike. Vurtually all banks have a real estate department and all of them have an REO department set up to sell me the deals they do that go bad.
The question is not why but why not. By the way for every 1 billion Warren has invested if he can just make 3% per yr he makes 30,000,000 per yr. You think he only makes 3% ?........Good stuff!!
- New to Real Estate · Baltimore, MD · Member since 2014 · 33 posts · 17 votes11y
I guess for me, someone who is interested in real estate investing, would be to be able to control my worth. A normal 9-5 job/career tells you what you are worth and takes 40 hrs or more of time, that could be spent on raising your family. With real estate investing, I can be in control of my own worth, not someone else's bottom line. I'm not saying there's anything wrong with a 9-5 job. however, for me, all I know is struggle. Real estate is my way out of poverty. Yes, it requires knowledge and hardwork. I know that I may fail from time to time. I even risk losing everything. I would rather risk it all and control my worth and spend 20-40 yrs in a career, which a rolex to show for my hardwork.
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