In talking to my clients and coaches lately, I’ve been hearing and seeing, more and more interest in buying and holding foreclosures for immediate cash flow and wealth building, versus flipping for short term profits. There is a reason for this switch. The housing market we are in right now, is like nothing I have ever seen in my 25+ years of investing. And I am not alone. Here is what, Daryl White, personal investor, instructor and coach here at Foreclosures.com has discovered…
“I’ve personally done quite well with rental houses for the past few years, buying 1-4 unit properties in my local market as they are easy to buy, finance, and manage, and building huge profits when I resell. Not only is the rental market strong, but the lease option market is hotter than ever.
My rentals have also proven to be my safest and least risky long-term investments, because their long-term appreciation in prices (equity) is driven by buyer demand for houses, not by their rental income.
There are many important pieces to my rental business plan, but the key components are 1) buying at the right price, 2) cash flowing immediately, and 3) holding long-term, 5 years or more. Buying at the right price, at least 25% below current market value, gives you a decent monthly cash-flow right out the gate. Cash flowing to cover all your expenses (not just your mortgage) assures you have a positive experience with profits you can bank on immediately. Holding on to the property 5 years or more gives you time for market value increase, or recovery should the market drop in your area.
I believe 2012 will be the best time ever to buy rental property for many reasons. 2010 and 2011 we saw the banks take back a huge amount of inventory through foreclosure while at the same time, delay in foreclosing on literally hundreds of defaulted mortgages. The word on the street is that this year the banks will be speeding up the process of foreclosing on defaulted mortgages and becoming more motivated in selling their huge REO inventory.
So what does that mean to the investor looking to buy and hold cash cow rentals this year?
1) There will be plenty of deals for 30% or more below current market value.
2) Rental rates are on the rise and that translates to immediate and growing cash cow rentals.
3) Due to a tough economy, high un-employment, and a huge percentage of foreclosures these past few years, many potential home buyers are holding off on buying a home and are renting instead until things improve. This means there is an abundance of potential renters out there for to choose from and the potential for rental income increases over the next few years.
So if you want to build your rental empire, banking money every month with your passive investments and build wealth through equity appreciation over the next 5 years… then NOW is the time for you to jump in too.” Daryl White, Investor, Coach
Join Daryl and I this Wednesday in our Brand New Professional Investor Webinar “Eliminate the Ups and Downs of Real Estate: Launch Your Foreclosure Rental Cash Flow Empire“, Special Live Event: Wednesday, January 25, 2012 6:00pm PST. Details Here or Call 800-310-7730 x2. Talk to you then!
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