Real Estate Blog May Archive

Forget about all those get-rich-quick schemes that promise pennies on the dollar and unimaginable riches from day-one. If you've got a new job, and more money than the bear minimum to buy a house, you can start your real estate empire today.

Here's how it works:

1 – Don't buy something big, fancy and out of reach. Instead, put minimum down on a house so cheap you'd never want to live in it. Buy it, live in it, wait a year (while saving up to buy your next one,) then rent it out.

2 – At the end of your year in that sad, dilapidated house, take the money you've saved and move out, buying another such property. You know the kind, it's the SAME kind, the one you didn't want last time. Now you have two houses, and you're well on your way.

3 – Buy a third house, still with just 5% down, and you'll qualify because you have good credit, fair cash reserves, and rental income to boot.

Best thing using this method is that, when property goes up in value, you'll enjoy three-times as much of it (since you own three houses), even though you only had to put down 5% of the cost, and the rents will damn-near cover the balance.

READ OUR POST ABOUT REAL ESTATE ARBITRAGE

How Real Estate Arbitrage Can Make You Rich

If you want to invest $100 in the stock market, you'll need to have $100 to do it. Imagine a better investment, one that let's you put down 5%, borrow the difference with a tax deduction, and imagine your stocks will actually let you live there. It's an odd thought, but it's real estate, baby.

By the way, arbitrage is when you borrow money to invest money, but in this case it's a mortgage to buy a house.

Here are the benefits:

1 – Unlike other investments, you get to live there.

2 – You can watch the value, paint to improve it, and be in charge of how it goes.

3 – For 5% investment (plus comparable rent/mortgage cost) you can control the full 100% of the value.

4 – If property values go up just 10%, you'll triple your money on sale. Yes, triple it, despite appreciation of only 2-5%.

5 – You're likely to save more money on taxes than you pay for the mortgage. (Ask your accountant.)

6 – If you fall behind on payments or your financial life goes south, you've still got a portfolio to sell.

7 – If you find fantastic tenants, you can always offer to let them buy the house from you, assuming the profit remains tidy.

The bottom line is that you're using other people's money, at low rates, with tax and business benefits, to earn your own personal wealth. There are many more benefits, and we'll cover them all directly in future posts.