Buy and hold is where wealth is created in the real estate industry. We are talking about long-term wealth that allows for true success and freedom.
“Success is doing what you want, when you want, where you want, with whom you want, as much as you want. “ Tony Robbins
Our definition of buy and hold is a property that is bought with the intention of keeping for a very long period of time as an income producing rental property.
It can be a single-family house, condo, townhouse, multi-family, a large apartment complex just as long as the plan is to keep it for many years.
The goal of the buy and hold, when done correctly, is to have it generate monthly cash flow month in and month out with little effort on the part of the owner/investor.
Why buy and hold? Here’s our top ten, in no particular order:
- Over time real estate appreciates. Not a ton, but when added to the many other benefits there’s nothing quite like real estate as an investment.
- Lots and lots of tax benefits. We suggest you consult an accountant. We do.
- Monthly cash flow. When done correctly this cash flow can be enough to allow you to live comfortably.
- Someone else is paying off your loan. You’ve borrowed the money but someone else is paying your loan and all you have to do is provide a nice place to live.
- Sweat equity. We suggest buying places that need work.
- Value adds. Things you can do to raise the rents that have a great return on your investment.
- Stability. Everyone needs a place to live. In fact, home ownership is on a decline, which is good for those who own the places where people will be living.
- Asset. Better to have an asset than a liability.
- Leverage. You can borrow against your investment.
- Protection against inflation. Rents usually keep pace, and in some locations, outpace inflation.
We can’t think of anything else that can give you this many options, methods, ways to build your wealth, increase your cash flow, increase your net worth and give you true success than real estate.
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