It is important to know that buy and hold is very different from fix and flip. This is because investors purchase properties that they hold onto for the long term and have no exit strategy. Investors will purchase a property, fix the property, and then rent it out. Therefore, buying and holding is a great way to have an ongoing cash flow
Slowly Get Rich
Compared to fix and flips, buy and holds are investments that generate wealth very slowly. However, this can be a mass accumulation of wealth that allows for more liquidity. Additionally, real estate prices appreciate with time. Therefore, the longer you hold the property, the more it will appreciate.
Peace of Mind
Owning a property and receiving income through rental payments allows the owner to basically sit back and receive a steady income. This steady income is a result of monthly rental payments and automatic renewals of leases.
It’s Not a 9 to 5 Job
This goes along with having peace of mind. Buy and hold investments are low maintenance after they are fixed up and rented out. Most of the work related to buy and hold investments is related to finding tenants to fill the spaces available in your property.
The Struggles of Being a Landlord
Having a stable income through the payments from tenants is great; however, there are many responsibilities that come with the job of being a landlord. First and foremost, the landlord has the obligation of keeping the property in good condition. This is usually established through a lease agreement. Additionally landlords have to deal with complaints from tenants that can be very bothersome
Now you have some basic information on fix and flips and buy and hold investments, so which will you choose? Regardless of the decision you make you should fully research and consider what the benefits and drawbacks are of each investment. Both strategies are very important and an investor can’t go wrong with either.
Look for a way to finance your next project? Here at Sunset Equity, we deliver the industry’s best private lending products and programs aimed to serve our clients. We lend nationwide and make it our goal to provide the best in private financing in the real-estate industry so that you can fix and flip the properties that you want. To learn more about Sunset Equity’s lending programs, please call 1-833-SUNSET-1 or email [email protected]
Benjamin Donel, CEO