One os the most asked question in real estate is this, Should I flip or should I rent? Flip or rent real estate? Rent or flip? This question has many answers depending on who you ask and what your goals and ambitions are.
There are a million and one ways to make money with real estate from flipping, whole selling, renting and the list goes on. You have to decide what you want to do and what is right for you, some people make a lot of money flipping property but can’t make a copper penny being a landlord and renting out property. While some make thousands a month in rent income but have never done a flip.
Real estate has unlimited opportunities to make you money. People are making money left and right both from flipping houses as well as renting them for positive monthly cash flow. The same can be said to the many people who jump in without doing their homework and lose all their money. If done right success will be on your side.
Rent or Flip
Now let’s get to it. Lets look at the basic difference between flipping house vs renting them out.
Renting – Monthly cash flow , appreciation, tax benefits
Flipping – Fast profits
You have to ask your self, What is the reason I am buying real estate? My answer was simple, I wanted to create enough cash flow income to live off, and not to have a 9-5 job. That was my goal and that goal paved the bath to what kinda of real estate investor I would be.
Buying a rental properties creates the opportunity to build a substantial monthly income. Income that you can use to create more income. Renting out houses or other properties lets you build true wealth.
This all sounds good and everything but there is some down sides to renting. Most of the rental properties that people buy need work to be rent ready. For example after buying a property and putting in $15,000 of work in it to make it rent ready. You have to do the math and see how fast you will return your money invested. If you only make $400 a month in profit after all expanses are paid, it will take you just over 3 years to get your cash invested back. That is a long time.
This is where flipping makes a lot more sence. The person that flips houses will make his return a lot faster and will see a profit in a fraction of the time.
With a flip you buy cheap fix it up and sell for a profit. Then you do it all over again. Putting cash in your pocket after every flip. Some of my friends flip for a living and they thinks it’s the best thing since sliced bread.“If you don’t own a home, buy one. If you own a home, buy another one. If you own two homes, buy… Click To Tweet
My Real Estate Strategy
As you can see you can make money flipping house as well as renting them out.
I do both flip houses and rent them out. 95% everything I buy is to rent out and create positive cash flow, a monthly income that I can live on. The other 5% are flips, the only reason I flipped houses was to get cash to buy more rental property (bigger deals).
Flipping property is a great way to get more capital to buy rental property. I love renting property because I don’t have to wake up every morning to manage a flip and spend all my time doing renovations. I love the free time that my rentals are able to give me.
When flipping you always have to be active in the market, always looking for deals, always renovating and selling.
Many investors start out flipping houses to get the cash to be able to buy rental property. This gives them a quick boost into the market. It is also smart to use the money from your first flip to buy a duplex or 4 plex. This was you take a huge step ahead. Click Here for Resources that will help you make money in real estate.
The guys that buy and hold build long-term wealth and passive monthly income. The better deal you get to better it will pay off in the long run.
Some skills that every succesful investor has. You have to be able to manage people, this includes the tenants, contractors, loan officers and so on. Being consistent and getting things done on time is also very important. Forget rent or flip just do both!
Rent or Flip Conclusion
As you can see both have their advantages and disadvantages. I belive a combination of both is the best way to go. I plan on holding my properties for the long-term. I will keep adding more and more rental properties to my portfolio and continue to build my monthly income. Check out these cool Tutorials that will make the being a landlord easy:)
Just remember, there is an unlimited supply of wealth go out there and get your share.