Over the last several years, property flipping has increased in popularity across the United States. However, the strategy of buying a property and holding it is just as an effective way to make money in real estate investing. Hunter Estess, a successful real estate investor in Louisiana, has steadily increased his wealth with this strategy. Here are four steps to follow to help you build your wealth through buy and hold real estate investing.
1. Find the right property and the right price and with the right terms. In order to see how long, it will take for your investment to double, follow the “Rule of 72.” To apply the rule, take the rate of return on your investment and divide it by 72. This is a simple way to evaluate return without complex math formulas.
2. To make sure the numbers and the terms make sense, be sure to analyze the property. Take the time to evaluate the holding costs, the current rental market, as well as what it will take for repairs.
3. Buy property that is on the market for less than fair market value. Try to find a property that is at least ten percent of the current market value. Also take into consideration the average rate of appreciation in the area and which neighborhoods generate the best returns.
4. You must carefully screen your tenants. In order to ensure you have the right tenants in place, you need to tailor your marketing strategy to coincide with your target market.
There is no magic bullet when it comes to investing in real estate. You need to know the models for investing and applying them repeatedly as you purchase more property. Hunter Estess, the owner of Dash Development and Holdings, has been successfully investing in real estate in the South Gulf area for more than ten years.