Most of you know that I am a real estate agent. What you may not know is that I am also a real estate investor.
Real estate investing may sound risky or even a little scary, but it really is less risky than the stock market, and once you know a little bit about what you’re doing, it’s not scary at all. You don’t need to be wealthy to get started, either.
BUY AND HOLD STRATEGY
There are several way to invest in real estate. Some are riskier than others, but for the purpose of this article, let’s focus on the “Buy and Hold” strategy. Simply put, this is where you buy a home and rent it out for a profit. If you are currently renting your home, then this is the perfect way to start.
INVESTING IN A DUPLEX
Instead of looking for a single family home to buy and move your family into, maybe look at buying a duplex instead. Now you can rent out one side and live in the other. Your tenant will pay you rent which will, in turn, pay for your mortgage/insurance/property tax for you.
Just make sure that you squirrel away the rest of the rent payment each month so that you have a nest egg to pay for the maintenance on the place like a new roof, new A/C, etc.
You can live in the duplex as long as it takes to save enough for a down payment on a second home, and then you can buy a single family home for yourself and rent out the second side of your duplex. Or you can stay put in the duplex and buy another rental.
Remember, by living in one side and renting out the other, you are not paying rent and the income from the other side is paying your mortgage. So saving up for a second house should be a lot easier.
Now that you have a rental property under your belt, it’s not so scary, is it? There are plenty of books that you can read on the subject of “Buy and Hold” investing, and I recommend you read at least one of them.
You should also read about how to be a Landlord, so that you can make sure that you don’t do anything you might later regret.
DON'T SWEAT THE SMALL STUFF
You will make mistakes along the way, but don’t let that discourage you. Learn from those mistakes, and keep going. One thing that has really helped me navigate through the waters is the website BiggerPockets.com.
This is a place where investors from all over the country come together and help each other out. Check it out, read the forums, and then contact me and we can start looking for you first rental!
I think you will find the world of REI is a fun place to be, and on top of everything else, you will start heading in right direction for a very comfortable retirement!