How To Make Money In Real Estate

I like to start at the end. In other words, I would get my renters before anything else. If you prefer to skip this step until after you have the property that is fine.

After you have your renters, Go out and find some rent to own or lease option properties. See as many as you can that fit your renters specified needs. Work out the numbers in all of the houses.

Offer on the property. Make sure you are in control of as much paper work as possible. You can usually offer asking price for the property. You are not selling the house in the traditional flip style so you will still make money by doing this.

An Example of a transaction: House price is 100k with a 5 year lease with $1200 per month rent with 20% going toward your down payment. You can actually try to lower you monthly output by raising your total purchase price by 5%,ie: 105k, 5 year lease, $1000 per month, 20% toward down payment. Option money should always be around 4000 dollars or less.

After you acquire the property, Get as many potential renters to see the property as possible at the same time. It creates the fear of loss you need to close the deal immediately. Have everyone sign in and on the sign in roster have a place for the to write down the maximum they could afford for Option Money. Show property and get everyone to sit with you before they leave and take them individually to find out there opinion on the property and to write offers on the people who loved the home.

You can make money built into your offers. Example: you got the property for 105k, 5 year lease, $1000 per month, 20% toward downpayment. Write there offer for a 2 to 4 year lease option with 5% per year. This is were you make your money. In 2 years the property would sell for $110250, 115,762 in 3 years and 121,550 in for years. If you were to increase the rent by only 200 dollars then you would have made roughly 10k in 2 years, 17k in 3 years and 26k in 4 years. Thats not bad at all. Make sure that your tenants option money is 5k or more if possible.

In summary, Your money is made when you buy. You can gaurantee your earning by making adjustments to the sellers offer. You can always make money from raising the rent you charge your tenant above what your land lord charges you for rent.

By: John Estate

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