If you're not currently investing in real estate, what are you waiting for?
For decades, real estate has proven to be one of the best ways for Americans to gain financial freedom.
There are many ways you can make money through real estate.
In some cases, you don't even have to own a property, or have a ton of cash to get started.
Today, I’m going to share four ways that you can become financially free and potentially make millions through investing in real estate.
If you’ve followed me for any length of time, you know that my preferred investment is multifamily real estate syndications, of course. But did you know that I got started in real estate by flipping houses?
Flipping means that you buy a single family house, fix it up, and then sell it for a profit.
I did about three dozen of these, and it was a great experience. But it was also a very active job, and what I was actually seeking was financial freedom.
There's really nothing financially free about flipping houses, because when you’re not buying, fixing and selling houses, the money stops. When you sell the house, the money stops as well.
If you like the idea of buying a property and keeping the asset for yourself, then you might consider a second opportunity for making money in real estate investing, which is owning rental properties.
OWNING RENTAL PROPERTY
The truth is, not everyone wants to own property and not everyone can qualify for a mortgage, so many Americans rent.
Buying a property with the intention of turning into a rental is a great way to earn cash flow while someone is paying the mortgage on the property.
To get started with rental property, you're going to need to have good credit and come up with a down payment in order to secure a mortgage.
Owning rentals is a great investment strategy, but will it make you millions?
Maybe…if you own a lot of them.
It’s hard to scale single family house portfolios, very difficult to get the financing, and the management is a real challenge.
But what if you're able to own hundreds of units with hundreds of tenants without taking on the mortgage yourself, financing yourself, and letting someone else manage it for you?
Welcome to my world of multifamily syndications.
The last two ways you can potentially make millions in real estate is through either passively or actively investing in multifamily syndications.
(If you're not familiar with this, now would be a great time to check out my video about the real estate syndication process.)
In layman's terms, multifamily syndication is when a group of people pull their money together to buy a large commercial property, like an apartment building, that they normally would not be able to buy on their own.
PASSIVE INVESTING IN MULTIFAMILY SYNDICATIONS
This brings us to number three on the list – passively investing in multifamily syndications.
If you want to earn money from real estate but aren't interested in sacrificing your time to flip houses or deal with tenants, then investing passively in real estate syndications might be your best avenue.
This is an option that many busy professionals choose because they get the benefits of investing real estate and the cash flow tax deductions without having to sacrifice their time.
They see the value in leveraging the knowledge, skills, and connections of the professionals that are operating the property, and are more happy to sit back and receive distributions for their capital investment.
You can make some predictable financial planning with multifamily syndications that you can’t do with the stock market, because financial and multifamily are fairly consistent.
Imagine if you knew that you could get an eight to 10% cash on cash return and an average annual compounded return of 15%.
That would allow you to make some reliable investments about how much money you'd have to invest, how much you would get paid, both in cash flow, and in wealth creation.
There are people who become financially free through passively investing, and it didn’t take twenty years to do it.
Most have done it within five years of continuing to invest in multifamily investing, and now control their time.
ACTIVE INVESTING IN MULTIFAMILY SYNDICATIONS
Another great way to get into real estate is by actively investing in multifamily syndications.
I love actively investing in real estate, because it's a great way to use other people's money to start and grow your business.
As a syndicator, you're the one putting the deals together; you're finding the property; you're raising the money; you're hiring the property manager.
In addition, you get paid acquisition fees at closing, you get paid equity.
If you put your own money in a deal, you're going to be paid both as an active investor and a passive investor, and this is why I love this model.
It's great for people who don't have the resources to invest themselves, but also, a lot of people who start investing passively raise capital and begin to partner with other operators.
We’ve had so many people have success with this.
Bruce Fraser, for example. He quit his job and made a million dollars himself on his first deal.
Now, having said that, it was in Dallas, a hot market, and he got an unsolicited ridiculous offer – but he made a million dollars himself. That's crazy. But he's not the only one.
To date, we've helped 22 people not only do their first deal, but quit their jobs.
And that's what gets me really excited about this vehicle, both as an active investment or a passive investment to achieve financial freedom.
Real estate in general, regardless of what the asset is, continues to appreciate in value, and it makes a great investment strategy worth pursuing, in addition to or instead of the stock market.
Maybe you want to flip houses, or own rental properties, or you want to sit back and get mailbox money through passive investing syndications.
Maybe you want to play a little bit more active role as a dealmaker, a capital raiser – there's an angle out there that will work for you.
Will you become a millionaire?
What you'd like to do is set yourself up for financial freedom.
And what's that worth?
If you ask me, it’s worth a lot.