One of the things that I like most about real estate is how many things you can do with it. For example, you can fix and flip, you can buy and hold, you can go commercial. The key aspect of real estate, however, is your cash flow. You need to be making enough money to sustain your real estate portfolio. I always say that real estate is simple, it just isn’t easy. In today’s blog post, I’m going to show you how you can earn more with your properties.
How to Earn More with Real Estate
Cash Flow Tip 1: Review Your Formula
Whenever you’re investing in real estate, I suggest you have a formula. This means you know exactly how much money you will need to make on each property in order to be making a positive cash flow. Here are some examples of what I teach:
- The 1% Rule: Each month, you need to be charging 1% of the purchase price of the property. In other words, if you purchased a property for $100,000, you need to be making $1,000 in rental income.
- Net Income: There are a lot of costs associated with owning properties. I suggest that for every property, you make $300 net income per month. Think about it, if you have 10 properties, and your net income is $300 per month on each property, then you will be making $3,000 per month.
Cash Flow Tip 2: Build Relationships with Local Banks
One of the greatest lessons I learned while investing in real estate is to build relationships with local banks. If you’re an investor with multiple properties, you don’t want to finance all of your properties with regular mortgage loans. Local banks often have different loan products that they can offer. If they know you around in the community, you will start to build trust with them and therefore gain access to more creative financing.
As with any relationship, you want to make sure that you are keeping up your end of the deal, though. Their trust is something you have to earn, and once you abuse it, it’s unlikely you will ever restore it. It’s okay to make mistakes, but you get into trouble when you try to hide it.
Cash Flow Tip 3: Branch Out
As I said in the intro, there are many different ways you can invest in real estate. When I was younger, I had my finger in many different pies. Now, I typically just invest in townhomes and luxury houses. I have found that this is what works for me, but it’s good to try many of them out when you are just getting started. Here are some of the different aspects of real estate you can look into:
- Buy and hold
- Fix and flip
- Commercial buildings
- Section 8 housing
- Vacation properties
- Rent to own
Cash Flow Tip 4: Keep Learning
One of our real estate coaching clients joined the program but didn’t have any properties. They had retired and were looking into purchasing a vacation property for themselves. With our help, they learned how they could rent it out to others for part of the year and then use it for themselves the other parts. This helped them earn money on a property that otherwise would have just sat there.
Wherever you are at in your real estate journey, there is always something more you can learn. Stay connected and keep learning.
I want to take this time to say a huge thank you to everyone who has purchased tickets to my real estate workshop in October! We have officially SOLD OUT! I am so excited to see everyone there in just a few short weeks! If you want to stay up to date on all the events we throw throughout the year, click here.
Am grateful for this advice God bless you
Pr Ambrose glory of christ church MATUGGA
Thank you for reading my blog! God bless you, Ambrose!