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2011-04-20 17:57:11

Buy and Hold Investing:How to earn big profits, while avoiding the hassles!

Of all the different Investing Strategies, Buy and Hold Real Estate investing continues to one of the few tried and true ways to build wealth overtime.  With monthly cash flow, and earnings based on property appreciation, the earning potential is great, and the risk moderately low if the property is purchased correctly.  Now, while home prices across the county are at a low, and the demand for rental and owner financed properties is on the rise, is a great time to get started, or continue to grow your business.   Through this article I am going to explain to you how to profit big in real estate, maximizing your earning potential, while putting to rest many of the grievances commonly associated with Buy and Hold investing.  

So, if it is a great time to buy real estate, why aren’t more people doing it?  While the reasons vary, when surveyed, most people who do have the money to invest often tend to shy away from Real Estate because of the great expenditure of time, aggravation and overhead expense that often comes with holding properties.  Being a property owner is frequently associated with late night phone calls, costly vacancies, maintenance expenses, and tenants who don’t live up to their responsibilities.  Given this, most people prefer to invest their assets in more hands off securities – such as stocks, bonds and cds.   This is unfortunate, because, while investing in securities may seem easier to most investors, the yield for this type of investment is typically less than the yield from investing in Real Estate.  Plus, just because buying stocks, bonds and cds is easy, it doesn’t mean that that they carry a low risk profile – as we have seen as the markets have tumbled due to a weakening economy.   Real Estate, when purchased by an educated investor with cash flow and property appreciation in mind, is inherently less risky than most any other investment  vehicle.    

So, this begs the question, is there a way that an average investor can capitalize on all of the benefits of holding Real Estate, without having to deal with all of the woes of property ownership?  And the answer is a definite ‘Yes’, as a crop of newer companies have emerged that have not only made buy and hold investing easier for investors, but has enhanced profitability for those individuals who want to take the plunge into real estate investing.   While some of these companies have been around for almost a decade, the current real estate market conditions have driven strong growth, as real estate acquisition costs are down, and there is an ever growing need for rental properties and homes available with Owner Financing.  The stringent lending guidelines, of late have precluded many would-be buyers from purchasing with conventional financing – positioning them to be well suited for home purchase through alternative mechanisms, such as through Seller Financing, Installment Sales and Lease Options.    

These companies, a well-known one named, have turned the process of buying, owning and selling rental properties on its head.   They offer cost-free landlord programs, which alleviate the need for property management as we know it today.  Through their programs they are able to significantly reduce traditional Landlord responsibilities, such as property marketing, maintenance expenses and responsibilities, maintaining the tenant relationship, and monthly payment collection.  They are also able to eliminate costly vacancies, which is one of the most stressful elements of being a traditional landlord.  Through their programs, not only is property ownership much simpler, it is also more cost effective, increasing the profitability of the investment usually by tens of thousands of dollars.    

These companies are able to do this by changing the nature of the Landlord–Tenant relationship into more of a Seller-Buyer arrangement, cemented legally through a Contract for Deed Agreement (Also known as an Installment Sale).     With this, the Landlord/Seller is able to select a premium sales price, which builds in their investment profit, select a sales term – for as long as they would like to own the property, and set a monthly amount which captures recurrent cashflow.  During the Sales Term, the buyer is then responsible for all property maintenance, and is required to stay in the property until they are able to pay off the Seller in full, in the form of a balloon payment.    The company is responsible for Buyer relationship management and for payment collection.   This leaves the Seller/Landlord with very little to do, besides cash their monthly checks and watch their investments grow. 

Since the sheer volume of home buyers unable to procure conventional financing, properties offered through these programs are usually filled quickly, within a couple weeks.   And because home buyers tend to be more committed than regular tenants, the rate of Buyer default is extremely low.  By working with a company like, Landlord Sellers can tap into a broad network of buyers who have already expressed interest in buying a home in this manner.  The company advertises properties for Sale on their website, takes applications, completes all the contracts, and basically streamlines the process for any Landlord/Seller who enters into their programs.  And although the company is for profit, they offer their programs for Free to their Landlord/Seller customers.   

As I have explained through this article, Buy and Hold Real Estate investing can be extremely lucrative, particularly in this devalued real estate market, where property acquisition costs are down, and the demand for rental and owner financed properties are up. 

The emergence of newer companies, has made the process of owning and managing real estate not only simple, but more profitable.  This opens the door to the average investor to take advantage of this unique opportunity to maximize their investment dollars and build wealth over time. 


For more information on Buy and Hold Investing, Contract for Deed, and Installment Sales please visit my website at http://www.topdollarforyourproperty/landlords.html 

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