Long-Term Style Equity Building WITH CONTROL AND CONSISTENT CASH FLOW
In my opinion, CONTROL = CASH FLOW.
So let’s discuss how we can have CONTROL over our current and future RE investments.
Control comes in many shapes and forms, including hard work, personal focus, organization, determination. But let’s work smarter, not harder. Agreed?
In real estate, ‘smart’ control comes from two specific things: 1) learning how owners and tenants win and how they lose, and; 2) setting the deal up so you can’t lose.
Long-term rental holds create the situation where the tenants win and the landlord loses because the landlord cannot ‘control’ the tenant (can’t control tenants’ money, job, or family). The landlord sometimes can’t control when he gets paid or the move out condition of the unit. Through good tenant screening, personal management, eviction law, and luck, the landlord wins. All other times, the landlord loses. When the tenant wins, the landlord loses!
The best case for the real estate entrepreneur and investor is to set it up so you can’t lose. In concept, we must make it so that: When the tenant wins, the investor wins! AND When the tenant loses, the investor wins! In either case, the investor wins. That is smart control over your investment.
How do we do this, you ask? Allow me to explain.
Working ‘smarter’ is not that hard. In my experience, we can work smarter by passively adding CONTROL in our investments. We do this by evaluating four major concepts: demand, stability, strategy, and loss.
· Demand
Demand for your investment is a function of tangible qualities, such as the ranking of the area’s school district, neighborhood character, and the areas of job growth. Would you want to live there?
Demand = Larger, more qualified tenant pool
· Stability
Does you investment property attract potential tenants that have stable lives? Stable job, money and family?
Stability = Less vacancy
· Strategy
Does your exit strategy give your tenant the upper hand, or do you have the upper hand?
Strategy = Win-Win for both tenant and landlord
· Loss
Does your exit strategy keep your tenants honest and keep them from breaking their promises? Will the tenant lose anything if they don’t do what they said they would?
Loss = Financial leverage against tenant
We have found that by combining the four concepts of demand, stability, strategy, and loss, we create an investment exit strategy that combines the CONTROL and CONSISTENT CASH FLOW we need to be successful as RE investors.
Alternative real estate exit strategy that will create long-term equity and consistent cash flow
Buying a nice, pretty house in a high-demand area and then leasing out the home to a lease option tenant buyer, in my opinion, is a great vehicle to create long-term wealth –WITH CONTROL AND CONSISTENT CASH FLOW. Why?
· There is great demand from tenant buyers for houses in great condition and in great areas. Many of these tenant buyers are professional people who have a ding on their credit. And now that the sub-prime ripple has widened, more and more folks are finding that they can’t get conventional financing and are stuck.
· Many potential tenant buyers have good income with stable jobs. Several are couples with children who wish to no longer be a ‘renter,’ or be forced to periodically move into new school districts as a result of their landlord deciding to sell. This happens very often. These folks WANT STABILITY!
· A lease option exit strategy gives the investor the upper hand in terms of CASH FLOW as the tenant buyer is responsible for all repairs and utilities!
· If the lease option tenant does NOT do as they promised, including paying on time, keeping the premises safe, making repairs, mowing the lawn, shoveling snow, and buying the house – THE TENANT BUYER LOSES. They lose their option fee and rent credits, which total many thousands of dollars.
· If the tenant buyers fulfill their promises and purchase the home, you as the investor have just helped a deserving family obtain the dream of home ownership.
It’s truly a Win-Win; and it has CONTROL AND CONSISTENT CASH FLOW.
If you know nothing about lease options or need some help, we specialize in coaching investors on the ins and outs of using the lease option as an exit strategy. We also can provide pre-packaged lease option deals to our members. As a member, all you need to do is your due diligence, and then write a check at closing. Because we negotiate well with sellers, you may have to put less down than you think. A typical down payment is 10%, and the returns are huge.
Come out to our FREE seminar and we will show you how to buy pretty houses in nice neighborhoods and get great tenants…and the properties WILL CASH FLOW! Learn how to create enough income and equity to retire in five years, how to turn 3 homes into 24 homes, and how to get an extra $200/month from each of your properties…and much more. This is not get rich quick, it’s get rich smart!
The seminar is Thursday, June 25th, 2009 from 6:30 pm to 8:00 am at the Foley Professional Center. Only 5 spots available, so RSVP now!
Your friends at MyFavoriteAgent.com LLC — Tami Roberts, Tonya McGuire
Online registration available at http://FreeClass.MyFavoriteAgent.com
