Making money in real estate can be easy, it can be risky, but nobody will deny that the best way to earn money with your real estate investments is through CASH FLOW.
There are 2 types of ways to make money. One is working for it, the other is NOT working for it. The EASIEST money you can make is when you don’t have to work for it.
Sounds pretty easy, right? Well…it depends.
How Can I Make Money with Cash Flow if I don’t have any?
This is a great question. Where it is possible to acquire properties with no money down, it’s almost impossible to do by yourself. There are ways, depending on your integrity, your credit scores, other people’s trust in you, yes, it is possible to buy cash flowing properties without any of your own money. However it is so much easier if you have decent credit and some money in the bank, or in your 401k/IRA. Some people forget they have that IRA money. If you do, you may want to speak with an expert on how to leverage your IRA funds to get into real estate investing.
What about my IRA?
You may not know it, but if you have some IRA money with your bank or a brokerage like Fidelity, you may want to consider moving your funds to a “self-directed IRA”. There are several firms that offer self-directed IRA’s, and I even featured one company on one of my calls a few years ago. You can listen to that call HERE. But please don’t let that overwhelm you. The bottom line is you just MAY have money you didn’t know you could use.
I Found Some Money! Now What?
Great! Now we get into the nitty gritty and analyze your investing goals. Are you saving for your kids’ college, your retirement, or do you just want some side money coming in each month? Once you have your main goal in mind, you want to answer the following questions:
- Where should I invest?
- What should I invest in?
- Where can I get the most cash flow for the least amount of investment?
- How can I leverage what I have to gain greater returns on my investments?
LOCATION, LOCATION, LOCATION
You’ve heard this before, and it is so true. You want an investment property that will serve a community that can pay for your property. That means you don’t buy an abandoned home in the middle of nowhere. The location should have some amenities or serve a local area that is in some level of demand. Colleges and large corporate presences are some of what you should look for when determining a location.
Leverage
You don’t need to have all cash to invest in a rental property. Most banks will loan a certain amount of money at a reasonable interest rate if you also have a job and decent credit. If you don’t, consider partnering with someone that does, or research some of the hedge funds that create landlord loans.
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