Long term real estate investing has this misconstrued reputation as the Crock-pot of real estate investing strategies: Low and slow, set it and forget it and at some point you end up with something good enough. You don’t have to be a master chef to work it either. You purchase some properties, you let them “simmer” over time and before you know it, they’re paid off.
I have a major problem with that analogy. I happen to believe that when executed properly, a solid long term real estate investing strategy can be more like a Joel Robuchon seven course meal.
It All Starts with Your Expectations
Henry Ford said: “whether you think you can or think you can’t – you’re right.”
When you start out aiming low and think all you’ll be able to do is purchase “a couple of rentals” and pay them off over time, that’s all you’ll be able to do. So today, I want to show you what a carefully planned and precisely executed long term investment strategy is able to accomplish in a relatively short period of time. My hope is that as you see what’s possible, you’ll avoid stunting your expectations and set them free to accomplish much more important goals.
A Million Dollars in 13 years and 4 months
Let’s take a look at a case study. Mr and Mrs. Smith are a couple in their mid 40s earning a combined annual income of just under $200k with available liquid capital of about $400k in addition to other investments (stock, life insurance, emergency funds etc.). They want to invest this hard earned capital in quality real estate using a long term strategy. Here’s what they would be able to accomplish given current market conditions in Houston, Texas (our home base):
- Purchase 9 investment properties @ $150k per …read more