‘Toto, I don’t think we’re in Kansas anymore,”.
A classic line from the golden piece of literature by L. Frank Baum…so classic that it still lingers in the pages of literary modernization up to this day. Just like how a typical genius is, The Wizard of Oz himself possesses tricks and secrets that can turn him into a master of his own trade. He has secrets that will uncover the truth to eternal glory and success. Real estate investors are, in a way, also wizards of their own craft. At times, they strictly follow rules, procedures and processes in order to attain ultimate supremacy. In any real estate investment discourse, a classic question will always manage to emerge: How to be a real estate millionaire? Today, we will embark on a journey of unearthing the art of money-making through real estate investment.
Sounds like music to the ears, but can real estate investing really make you a millionaire?
As a tangible asset, real estate will always be essential which means you’re able to finance your investments and grow your wealth with other people’s money. There are also incredible tax benefits to investing in real estate, so you’re able to keep more of the money you make. These advantages make becoming a millionaire in real estate investment seem to be just a walk in the park for dedicated and determined real estate investors, thus proving its long-time argument of being a viable approach than doing so with any other type of investments.
Before jumpstarting into real estate investing, you’ve got to learn as much as you can about the types of investments and strategies you’re interested in. Learn about what’s involved in managing a property, how taxes work, and what it will take to get financing. Good news! All these and more are expertise of a real estate marketing intelligence company dubbed to be No. 1 in Deal Finding. Real Estate IQ will help you make a splash to the sea of real estate investment opportunities.
If you are giving real estate investing a shot, we better take out the big guns because the reality is: real estate is a well-oiled, wealth building machinery that has made thousands if not millions of individuals around the world…hotshot millionaires.
Perhaps you can. – but there goes the big BUT : not everyone who buys a piece of property becomes rich. In fact- many people buy real estate only to find stress and empty bank accounts. They struggle for years and years but never get the chance to get back up and actually reach their dream destination. Bearing that in mind, let’s go back to the question: How do we use real estate to truly become a millionaire?
Just like a compass that has four major directions, there are four primary “Wealth Generators” in action when you invest in the real estate business, depending on the strategy you would like to you get into:
• Cash Flow. The most basic definition of cash flow is income minus expenses. That is, if an investment property’s rental income is greater than the expenses of owning, operating, and managing the property, you would have positive cash flow. On the other hand, if a property cost you more than it brought in, it would have negative cash flow.
• Appreciation. Appreciation can best be described when the value of a property increases. The amount of price appreciation of a property is dependent on various factors such as demand and supply, interest rates, and location. Future development plans also play a big role in introducing the idea of “forced appreciation,” the strategy of increasing the value by physically upgrade of the property.
· Tax Benefits. The tax benefits associated with owning a property in the United States are what make up our fourth wealth generator from real estate. The U.S. government likes real estate investors and uses the tax system to encourage our purchase and leasing of properties. Tax benefits encapsulate Tax Deductions, Real Estate Depreciation Tax, 1031 Exchange Tax Benefit and Capital Gains.
• Equity. It is the difference between the market value of your home and the amount you owe the lender who holds the mortgage. When you buy a property with a mortgage, each month your loan balance decreases. This means, over time, your tenant is essentially paying the loan down for you, helping you build wealth automatically. In simpler terms, it’s the amount of money you’d receive after paying off the mortgage if you were to sell the home. Homeowners can build home equity in two key ways: by increasing their home’s value or by reducing the amount they owe on the property.
There are many books and resources available to help you learn how to invest in real estate. It’s also a great idea to get advice from other investors. Just make sure you’re getting advice from the successful investors. If you can find a mentor, that’s even better. Visit our Community and get the opportunity to network with other real estate professionals. Click HERE to join for FREE!”
Now, of course, no one wants to wait 30 years to become a millionaire. At this point, you will normally ask if there’s a shortcut. There is no shortcut to success. It will never be achieved overnight but the good news is, there are a few ways you could accelerate this process. Well, Real Estate IQ is not No. 1 in Deal Finding for no reason at all. REIQ is always here to save the day. If you want a 360 degree turn in your real estate investing performance, discover our tools, packages and services all available in the Real Estate IQ website.
We have only introduced you to the surface on what real estate investing can do for you in your quest to become a millionaire. In fact, there are so many different paths and strategies you could take to become a millionaire through real estate investing as evidenced by a good number of books already written about the topic but still not able to cover it all. You could spend your whole life learning about real estate and never learn it all. That is when it becomes problematic. People get stuck in “education mode” and never escape it. If you are interested to get help to move forward with your business goals, check out these institutions that are motivated to help you, HERE in our REIQ Education.
Becoming a millionaire in real estate is not a far-fetched goal. It’s also not an easy goal to achieve. Don’t expect it to happen overnight, but know that you can make it happen. Gaining the right knowledge, making a plan, and continuing on to be persistent in your plan to become a millionaire in the real estate business is the key to real estate investing success. The road might be tricky, long and winding as The Beatles song would put it— but if you just keep moving forward, more of the road ahead will be revealed. Just like young Dorothy who, with all her might (plus the help of her newfound friends and companions), followed the yellow brick road to find the wizard and asked for help in order to get back home. She had been unstoppable every step of the way and knew in her heart that she would one day reach her home destination in Kansas, a place where her own idea of freedom, success and happiness truly lies.