Building capital through flips or other ways?

Question

I'm about to close my first deal for $150k rental property which will cash flow $14k yearly.

Thinking forward, what would be an ideal strategy to generate enough income so I can retire in 10 years? I can refinance and buy another rental, then keep doing that, but I'm. Thinking if there's a better way to first build capital and then buy rentals, refinance etc just with a better starting point.

If you can share your thoughts about this or any other method that'd be great. Bear in n mind I don't plan to use any of the cash and reinvest all of it.

Joe Villeneuve · Answer

Flip and reflip profits along with original, over and over.  Reach a predetermined number.  Continue to flip but spend the profits ONLY for cash flow Down Payments.  Reinvest larger seed money.  Never spend your seed money, just your profits.

Kase Knochenhauer · Answer

@Roy Gottesdiener - spend less & save more!

Reduce overhead: stop eating out, move somewhere cheaper, drive a terrible car, cut cable, sell your TV, etc

Make more money: get a job promotion, work overtime, flip homes, deliver pizza, etc

Determine what is your highest dollar producing activity and do it as much as possible.

Mitch Harold · Answer

Youve got flip homes and deliver pizza next to each other in a sentence, like, they are basically the same thing, lol.  Has anyone ever gotten ahead in life delivering pizzas on the side?   Maybe saved up enough over the course of a year to take a vacation, but cmon, save that garbage for the financially illiterate.

Whitney Hutten · Answer

@Roy Gottesdiener Sounds great!  Please do.

Joe Villeneuve · Answer

First add the initial flip profits to the seed money to grow the seed money large enough so the profits generated by the larger seed money is most useful.

Roy Gottesdiener · Answer

@Joe Villeneuve love that approach, I think that's what I'll do - use the initial sum for flips and any profits to buy rentals

Roy Gottesdiener · Answer

@Whitney Hutten thank you so much, great input. I'll reach out with questions if you don't mind

Whitney Hutten · Answer

@Roy Gottesdiener to create velocity with your money you will need to:

- reduce all expenses

- increase your income

- save & invest the difference

So how do you increase your income?  You read about 20 ways here. But... You want to build equity faster and in larger chunks. I do love flipping for that... just know that we are closer to the top of the market than the bottom so it is imperative to multiple exit strategies in place on a property to not get stung.  Also know that this is active income and Uncle Sam will want his cut (just plan for it!).

You can also continue to BRRRR and recycle the same capital over and over AND it's very tax-advantaged when you pull out money tax-free with cashout refis (got to have a smoking deal now OR let time do the work for you).

Then, there is the buy and hold method, again letting the market and time work for you and you 1031 into a more/larger properties later.  Here is a good summation here.

PM me with Q's!

Roy Gottesdiener · Answer

@Kase Knochenhauer

Thanks. I was aiming more for how to build capital through real estate investing - flips, BRRRR, multifamily etc

Roy Gottesdiener · Answer

@Jaron Walling not sure I understood what you mean but I sense a bit of sarcasm.

Anyways, the 150k was split into two assets and this is the ARV, I invested 120k.

Now the question is how to move forward and build more capital.

Building capital through flips or other ways?

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