Are You Ready to Create Cash Flow Now?

Real estate has historically created more wealth than any other investment platform. This exchange or transfer of wealth has happened over and over again and most clearly during the tough economic times of recession.

I believe we are experiencing the greatest transfer of real estate wealth of our generation.  Understanding the dynamics at play in the current market and how to position to leverage the voids in the market with low downside risk is the key to your wealth and income.

More Income Streams = More Cash Flow

With the right strategy and systems you can safely create income streams from today’s opportunities.

Is it as easy as firing up your own money machine? Not quite, but with the right strategy and systems you can safely create income streams from today’s opportunities.  Real estate is a diverse asset class that includes single-family homes, land, commercial, and multi-family opportunities.
The good news is real estate is on sale, and there is a lot of distressed inventory to choose from.  You can create a lot of different income streams from today’s opportunities–even without cash on hand or having good credit.
Here are some of the income streams you can create with the real estate opportunities right now.  Each of these income streams is highlighted in my new book: Cash Flow Now: How to Create Multiple Streams of Real Estate Income.

Active Income Streams

1.  Wholesaling Houses:  This is the income stream that set me free from “corporate America.”  It is essentially selling your equitable interest in houses you don’t yet own, without needing cash or credit.
As a wholesaler, you create an income stream by getting into the middle of real estate deals.  You find a super motivated seller, control the house with an option, and sell your option (or assignment) to an investor who wants to rent or rehab the house.
Your income stream is the difference between the price at which you are buying and selling the house.  For example, you find a house needing a lot of work that you can control for $35,000; then you find an investor to buy the house from you for $42,000.  Your gross income for this transaction would be $7,000.
2.  Flipping Houses (rehabbing houses):  House flipping is an income stream created by buying cheap houses, adding value with the right renovations and then re-selling the home for more than your invested capital. Rehabbing and flipping houses can create large chunks of income, but things have to go just right in order to capitalize on the opportunity.
First you have to find the right house, in the right location, and at the right price.  Typically it’s the worst house in a nice area with good schools that will appeal to home buyers. Once you find the house, you need to pay for it.  Houses are still big-ticket items and most people won’t be able to simply write a check.
The best way to buy houses to flip is with “easy money loans” using joint ventures and private money, so that bank mortgages, cash, and credit are not required.
Once you buy the house, the joys of renovation begin with finding the best contractor and completing the renovation on-time and on-budget.
Finally, the house must be sold. The keys to selling are in the marketing. Today’s market is excellent for flipping houses. Just be aware that a lot of things have to go just right.

Passive Income Streams

1. Buy and Hold Rental Property:  Today is the perfect market to establish your plan to buy and hold rental property.  Why?  Because the returns are so much better than they were just a few years ago, and investors from coast to coast can now establish strategies to earn positive cash flow from rentals.
My advice is to buy houses for the positive cash flow, not to merely build your real estate empire or net worth. If you focus intensely on cash flow, your investments will pay you an income stream every single month.
Buying and holding rental property can create cash flow for today, long-term wealth, and huge tax savings.  Consider using joint ventures and equity financing rather than the traditional approach of bank financing. Long-term, every investor needs to buy assets and switch from active/transactional income streams into passive/residual income streams in order to become financially free.
2. Lending income streams:  If you are fortunate to have significant funds and are tired of not earning a return that keeps pace with inflation, you are a prime candidate for lending income streams.  People are tired of watching their stocks, bonds, and mutual funds drop and need an alternate approach to the safe, but poor earnings of CDs.
There are some excellent passive income streams in real estate that do not require time, toilets, or tenants. There are two basic types of financing you can structure to provide great returns for everyone involved.
Debt financing – This is typical bank-style financing that includes an interest rate and points. Points are essentially another form of interest, but it is pre-paid. For example if a bank is loaning $100,000 on a mortgage and they charge two points, the two points equals $2,000 and they collect that upfront when the loan is originated, rather than on a monthly basis.  Real estate investors are able to pay a very fair interest rate to put your money to work and earn you a great return.
Equity financing  – An alternate form of financing that that does not include interest or points. Instead the borrower pays the lender with a portion of the equity and dividends in the form of rental income.  This works perfectly in a joint venture strategy to buy and hold rental property.
There are a lot of income streams available using real estate as an investment platform.  Which ones you choose depends on where you are at, where you want to go, and the amount of work and risk you are willing to take.

By Jim Ingersoll

Jim Ingersoll is a successful real estate entrepreneur, Author and Coach. He has bought and sold hundreds of houses wholesaling, flipping and buying to hold for the long-term. Jim loves all aspects of creating winning transactions with creative real estate.