I'm a new investor and have been analyzing lots of deals and absorbing as much information as possible. Some of the properties I have found look like good investments that have cap rates about 10% and the cash flow 500-1000 each month. However, the cash on cash return is generally around 4-5%. I have yet to find a home run deal that would provide me additional capital to reinvest in other deals. Therefore, my down payments would quickly deplete my liquid capital. How do seasoned investors overcome this and find additional capital to keep building their portfolio? I'm sure there are many answers to this question but I'm looking for those that do not require lots of outside investment. Are there any common strategies to continue to build your portfolio?
If you keep buying turn-key real estate(retail pricing) you will eventually run out of money. The key to growing a rental portfolio at a reasonably fast pace is to acquire foreclosed properties that require rehab, therefore the equity position may be large enough to refinance cash out your original down payment funds to recycle into the next property. This is key to growing a rental portfolio sooner rather than later.