Real estate offers great opportunities for building your income potential, but as Linda McKissack, owner of McKissack Realty Group pointed out in her recent webinar, “the day you sell your last house is the day you make your last dollar.” So selling 25, 50, or even 100 more houses won’t change that. For McKissack, the solution was to not just sell real estate but to invest in it as well.
She flipped a few houses when she was just getting started, but found that the real income potential is reached when you hold on to your investments to create recurring monthly income. Using lessons from her book, HOLD: How to Find, Buy and Rent Houses for Wealth, McKissack explained how to invest and earn money even with a zero dollar bank balance.
“HOLD is a long-term real estate investment strategy to which every real estate investor should aspire. Be an investor, not a speculator. We bought our first property while we were still $600,000 in debt. We now own over 100 single family properties. There are a lot of people who have money they want to invest, but they don’t have the expertise to do it.” Going 50/50 with a partner or investor is a definite option, especially using the HOLD strategy.
The HOLD strategy is simple:
- Find the right property, at the right price, for the right terms.
- Analyze the numbers and terms and be sure they make sense. Do your due diligence on area rental rates, market values, comparative prices, and appreciation to limit your risks.
- Buy an investment property where you make money from the start. If your numbers are right, you’ll make money on the margin and get a positive cash flow right away. Don’t buy a property hoping it will become a good deal. Buy it because it’s already a good deal.
- Manage the property yourself until it’s paid for or you have a large amount of equity to leverage. Run your investment properties like a business.
- Grow your way to wealth and financial freedom. If one investment can bring in $2,000 a month, imagine the income from 10, 20, or 100 properties.
To find out more about the HOLD strategy, catch the recorded Secrets of Top Selling Agents webinar.