Real estate investors search the real estate investing strategy with the aim to earn more money. But the ‘buy and hold’ investment strategy is the old, common yet effective one. In this strategy, the investor buys the rental property, improve it to make it good for the rental purpose, put it on rent to earn monthly income and hold it for years. Via this strategy, real estate investor about to receive the future appreciation of the property and fixed monthly rental income. Even the rental income increases over the year with a fixed per cent. That shows Buy and hold property is perfect, save an ideal way to invest your money in real estate. Adapting this strategy is going to help you in long run.
Note – Those who are seeking quick returns on investment this strategy is not for you.
Caution – There is as such no strategy in real estate which make you quick rich. So have patience and grow with the time in the right order.
Tip – Hire professional property valuer to take expert advice and know the rental value of the property before putting it on rent.
How the “Buy and Hold” real estate strategy works –
The most common real estate strategy i.e ‘Buy and hold’ is used by investors to purchase the rental property, rent them out and hold them for a long time at least for five to seven years (Though this time period is not fixed, if investor get some out deal after two-three years then also he can sell the property. It’s all up to investor).
It is the right way to build your wealth over the course of time from real estate property appreciation and generation of positive cash flow which helps to build equity.
The best part is this strategy can be implemented by a naive and beginner investor it doesn’t require any experience. And much easier than any other real investment strategy like fix and flip. Even you can take help from property experts to guide you in the property matters.
Here are the types of property which works wonders and appropriate for ‘Buy and hold’ –
- Turnkey real estate – The properties which are in good condition and usually doesn’t require any improvements. They are ready to move-in or use properties. Though these properties are bit higher in price when purchased by investors as they are well-updated properties which don’t require any changes. Investors can buy and put these properties on rent to earn good rental income. Later for some years after property appreciation, they can sell it out.
- Multi-family homes – Homes that possess the capacity to keep three to five families in a single place or home. Thus, investors can generate more rental income. As giving out the whole property to the single-family won’t help you to generate more income. Instead of this distribute the properties and rent the multiple tenants to generate more income.
- Vacation rental property – These types of properties put on short-term rental purpose usually purchase near the vacation point, in vacation places to get the short time visitor and tourist as renters.
These are the buy and hold property types. Hire West Coast Valuers for best property valuation services.
Andrew Smith is one among the top property consultant working for Perth’s best property valuations firm, West Coast Valuers. He has rich knowledge about the property and real estate industry and thus writing on how to find best property valuers in Perth for right property valuations.