It turns out that we couldn’t get enough of buy and hold in our last blog, so we’re talking about it again. That goes to show you how passionate we are about the process. If you missed our previous blog, here’s a quick recap. Buy and hold is a strategy where an investor purchases real estate and holds onto it as it appreciates. They rent out the space until they’re ready to sell it for (hopefully) more money than they paid for it.
Types of Buy and Hold Properties
Single-family homes are some of the best options for the buy-and-hold method. They’re easy to fix up before you’re ready to start renting and even easier to fix and clean between renters. And if you’re truly lucky, you’ll have long-term renters who you can rely on.
You might opt for a multi-family rental instead, and that’s great, too! Multi-family rentals mean more money in the short term because you’re collecting from multiple renters. The downside is that you’re liable to have bad renters who skip out on payments or damage the property.
Why Diversify?
Diversifying your portfolio with buy and hold properties gets you a steady cash flow in the short term through passive income. You can invest this money back into paying off the mortgage on the property. In the long-term, you’re looking at a huge win when the property sells. With a diversified portfolio, you’re lowering your risk of investment.
Buying Multiple Properties
If you’re established in the real estate game, you might want to buy more than one buy and hold property. You know that the more you have, the more money you’re going to make. In order to buy multiple properties, you’ll need to get familiar with your investing options. The best way to guarantee you’re on the right track is to get in touch with a mortgage broker that finds you ample options for lenders.
What You Need to Know
If you’re looking for passive income and want to start investing in real estate, buy and hold properties can be a game-changer. A buy-and-hold strategy means less volatility in the market and higher predictability on return. You’ll want to talk to professionals in the field when it’s time to sell, and no one knows the market better than your local real estate agent!