Residential real estate offers 5 Major Benefits.
1. Cash Flow –The rent provides income, i.e.“Wake-Up Money”. This is your ultimate goal. When your property is “free and clear,” you have the maximum cash flow and “Wake-Up Money.”
2. Leverage – You can own $100,000 worth of real estate with only 0% – 20% cash. You can also borrow cash out of one property to buy another. Your short term goal is to use leverage to acquire a portfolio of real estate. Your long-term goal is to pay the loans off and own your properties free and clear.
3. Debt Reduction –Real estate is one of the few investments where someone else will make your payments.In essence the tenant makes the payments and reduces your debt.
4. Tax Savings –You are allowed to depreciate the house and write off your expenses in order to reduce your taxes.
5. Appreciation – Over time the value of houses and condos have risen.
The “Wake-Up Money” Easy Investment Analysis and documentation was developed by Larry Kendall and The Group, Inc. Real Estate, and Tim DéLeon of Focus 1st,LLC, and all information associated with it is copyrighted and is used with permission.