A recent Forbes Magazine article stated that 97 out of every 100 self-made millionaires made their fortunes through real estate investing. Believe it or not, you, too, can take control of your financial life by creating wealth through the acquisition of real estate assets. You may be thinking that all of this sounds too good to be true; well, wait it gets even better! Not only is real estate one of the only investments in the world that you can acquire using the power of leverage, but the income and gains produced by real estate receive some of the greatest tax breaks available. Unlike stocks and other investments, real estate profits can be tax deferred or better yet, even tax free! The government allows you to roll-over each windfall into your next real estate investment. Does the idea of using someone else's money to buy something for yourself seem impractical? It shouldn't; it happens all the time. You've probably even done it before. Have you ever taken out a loan to buy a car? By doing this, you tapped into other people's money (the bank's) to buy the car. How much better would it be if you also had someone else making the payments for you? By investing in real estate, you do just that. Instead of using other people's money to accrue additional expenses, you use other people's money (the bank's) to buy the property, and you use other people's money (your tenants) to make the payment by renting the property out for more than it costs you to own it. The income produced by the property that is left over after all expenses are paid for is the property's cash flow. And simply put, that is the power of leverage. Too many people are under the impression that they need to save up a large down payment before the bank will lend them the money to buy a property. This is not true. There are a number of ways that you can obtain financing without bringing in a down payment. The easiest way to start acquiring real estate is to buy your first property and then use its equity to buy more properties. Equity is the difference between what an asset is worth and what you owe on it. If you own a property that is worth $100,000 and you have a mortgage on the property for $80,000, your equity is $20,000. Using the equity in one property to buy another is exercising the power of leverage. Leverage helps expedite the wealth process. Using leverage maximizes your purchase ability. It is the most efficient way to acquire properties, build positive cash flow, and take advantage of appreciation. Appreciation is the amount that an asset goes up in value over a period of time. If you took your $20,000 equity and used it as a down payment to buy one more property, you would benefit from the cash flow of two properties instead of one. You would also earn the appreciation of two properties instead of one. Real estate on average has realized between 3 and 8 percent appreciation per year. By using one property to buy another, you are using leverage, but not to its fullest. How much faster could your wealth grow if instead of using your $20,000 to purchase one more property, you use it to purchase four properties by putting only $5,000 down on each? Your wealth would increase by the appreciation and cash flow of four more properties instead of only one. Real estate can also build wealth in any economic climate. If the real estate market is up, quick turnaround investments (flips) can produce large, immediate gains. If the market is down, there are more opportunities to acquire assets at a lower cost due to foreclosures, motivated sellers and seller financing. When interest rates are low you can buy more assets for your buck. When interest rates are higher, more people are prompted to rent apartments, which translates into higher rental prices. The increased demand turns your real estate asset into a cash flow cow. Like you, when we were learning about real estate for the first time we were asking ourselves, So, whats the catch? I mean why isnt everyone doing this? And why arent the people I know that are doing this getting rich? It is because of their fear, their lack of knowledge, and their inability to find a real estate investment plan that actually fits their investment profile. That is where we come in. Before you start on your first project, our team will develop a personalized investment plan for you via the Personalized Investor Matrix. Then we will walk you through each investment project one step at a time. Our purpose is simply to help you succeed, create wealth, gain control of your life and start living the dream. |