I once heard it said, “Find quality properties in quality neighborhoods and rent to quality tenants to maximize your cash flow and minimize your risk.”
That quote sounds so great, but is it really true? When you find quality properties you would think you would pay a premium for them because they are in demand and they seem to attract multiple offers. So, the question becomes how do I find properties that cash flow without paying a premium for them? Or what about flips?
I can buy properties in badly need of repair and make good money there as well. I can keep them for rentals or maybe sell them for profit.
That question is the difference between buying cash flow properties and properties that don’t cash flow or to make them cash flow you have to put a ton of money down using up your capital. Please make note that cash flows come from rentals, which we call, buy and hold, however you can buy properties in repair and hold them or sell them. This may surprise you to find out that most investors who create risk in their investments lack the knowledge, and education to make the correct decisions. Real Estate Investing is not for the uninformed or the LONE RANGER.
It takes education and knowledge, mentorship, a team and a community to minimize those risks and maximize those cash flows. Let’s start with education and call our first investor, Mr. Savvy Investor. Education starts with learning how to find the great deals, how to determine the cost to repair and then to determine the market value after repairs are made. The Savvy Investor knows where to find the right contractors, realtors, escrow officer and build the right team. He/she also knows where he/she can get the right financing either private money or hard money or banks money to do the deal. Mr. Savvy belongs to a community of investors and all he/she has to do is pick up the phone and resolve all his/her concerns.
Mr. Un-savvy Investor shows up at the court yard steps bidding on properties competing with other investors and gets in an all cash bidding war with no clue as to cost of repair. Or ties up his/her capital on a costly rental. So, the risks are sky high before he/she even acquires the property., while Mr. Savvy Investor has a network that provides him/her with a constant flow of properties to look at. Mr. Savvy does not even have to read the short sale report or default mortgage report (these are good sources but takes time and effort). Mr. Un-savvy spends hours reviewing reports and driving around looking at properties.
Let me give you a short true story of one savvy investor I met named Mark. You see Mark went through an extensive educational program, got involved with a community of savvy investors and had the benefit of a very experienced mentor help him. Mark finds his first home for $85,000 and invites his contractor friend who he met in his investor community to give him an estimate of repairs. He writes the contract subject to financing and inspections and gets a counter offer to buy “AS-IS”. Mark immediately calls his mentor Denise and says, “I found this home and put in under contract and now I need financing what do I do?” Denise says, “I will call you right back.” 5 minutes later Mark hears from Denise, “I have the financing for you, a private lender who wants 10% interest and no points.” Mark accepts the counter offer and 90 days later completes the repairs and sells the property for $124,000 with closing and sales cost of $9,000, Mark makes $65,000 of profit.
Here is the moral of the story, you see Mr. Savvy Investor was brand new to real estate investing and this was his very first deal. Mark became Mr. Savvy through his education and experience from his team and community, and as a result makes good on his first flip. Not bad for 90 days work. Mark went on to make $3,000,000 in real estate in the next three years with zero losses and now owns a multitude of rental properties.
Moral of the story, being the Lone Ranger and investing in real estate is very risky, but with a team and network the risk is always minimized. Your net worth in real estate will always equal your network! Your education and knowledge is considered currency in our business.
NETWORTH = NETWORK
EDUCATION = CURRENCY
If you are reading this and really want to learn how to take the risk out of investing in real estate, whether to Buy and Hold or do Fix and Flip or maybe both like Mark, then we have the education and community to build your network working with savvy real estate investors.
Disclaimer: We do not guarantee or make a promise of income. Even though our instructors are seven-digit income earners their income is not typical. Your success is totally dependent upon going through our courses being educated and implementing our marketing and strategic strategies.
This is a highly educational program, this is not a get rich quick scheme or anything like that. This is not an MLM. Incomes are derived from selling our courses and investing in real estate.