For those of you who have been investing for a while, you have heard this from me time and time again. For those of you who are new to real estate, this is good food for thought.

It has been my experience that today’s market is more conducive to the cash out refinance and rental of properties than the buy/sell method. I have always favored holding real estate for long term growth and appreciation, as opposed to the buy/sell mentality. My reasoning is based in practicality as well as profitability.

I have a list of realistic expectations here with regard to real estate that may help guide your expectations.

Unrealistic: Quitting your job to FLIP properties.
Realistic: Buying Properties that are undervalued, Rehabing them, Refinancing your capital out and Renting out your property.

Unrealisitc: Quiting your job to FLIP properties…This is a VERY difficult business…I don’t recomend it full time, however it can be a fantastic tool when used properly!
Realistic: Leveraging Real Estate to create Equity and ultimately Wealth that is funded by Tenants rental payments.

Unrealistic: Tenants paying for your investment real estate with NO PROBLEMS.
Realistic: Tenants paying off or down your real estate with rents…..Expect problems…they happen.

Unrealistic: Buying propeties that need little or no work and flipping them for a profit.
Realistic: Rehabing Real Estate with a long term perspective in mind.

Unrealistic: Buying a house in foreclosure (or any house that is undervalued) that needs no work.
Realistic: Working with our rehab contractors to improve your properties at extremely reasonable costs.
***Rehab estimates are estimates…there is no way for us to know exactly what will pop up in any given home…it is extremely rare that we exceed estimates, and our crew works faster and cheaper than any other contractor I have ever seen…if you don’t believe me, call someone out of the yellow pages…they are often 2-3 times as expensive.  You are always welcome to rehab the homes yourself.

Unrealistic: Buying a house in foreclosure (that is not livable) and making it like YOUR home…for $9,000.
Realistic: Buying a house in foreclosure (that is not livable) and making it LIVABLE and NICE .for $9,000.

Unrealistic: Expecting your house rented without advertising.
Realistic: Working with our leasing agents to help you rent out your home for a nominal fee.
***Keep in mind these people are 100% commission, they want to rent your home as badly as you want it rented.  They show homes every day to people who miss the appointment, don’t have the $$$ on them and back out of deals…You are always welcome to rent the homes out yourself.

Here is what a typical foreclosure purchase and subsequent cash-out looks like.