Are you interested in a secure financial future for your family and children? I also. Here’s a small example of why I’m so adamant about building wealth through multi-family real estate investing.
As a parent, family member, or individual, one of the best decisions you can make is making the right investment from the start that will help solve all of your future financial problems and needs.
I’m going to share with you a real life example from my own life of how a $35,000 investment I insured a multi-family property generates an annual cash flow of $24,000 and will earn approximately a quarter of a million dollars in equity over the next 12 years! Starting with that $35,000 investment, my wife, Lisa, and I secured a college fund, living expenses, and monthly income for our newborn son. This is how it happened…
About four years ago we had the opportunity to purchase a mixed-use property (three apartments and a store) in Wilkes-Barre, Pennsylvania. It wasn’t a large property, but we liked the location (5 minutes from the new casino) and thought it would be a good long-term stay.
The purchase price was $65,000 but it needed $75,000 in renovations, bringing the total investment to $140,000. At the time we only had about $35,000 cash budgeted for this so I called an investor I had worked with in the past and he agreed to finish $105,000 at 10% over 1 year.
We closed the property, completed the renovations in three months, and the property was 100% occupied in eight months, producing over $3,000 per month in revenue. Now for the best part: The beauty of commercial real estate is that if there is cash flow, the banks are willing to lend.
We have a friend who works in the commercial banking department of a small community bank in Pennsylvania. I called him to inquire about a business loan on the income property and he told me it wouldn’t be a problem, he just needed to send the package with income and expenses, leases, completed work and a little information. on myself.
Thirty days later I saw how easy it was to build wealth through multi-family real estate. I went into the bank and they gave me a check for $105,000 at 6.5% for 15 years, and it was made out to my company. I immediately paid the investor. Now, three years later, the property is cash flow positive with only 12 years left on the mortgage. In just 12 years, we’ll generate over $24,000 in annual cash flow and build over $240,000 in equity.
This is not a massive skyscraper deal, but it is an illustration of what you can do when a good opportunity arises. As an investor, you are armed with the right knowledge.
My son is just over a year old, and by the time he’s 12, the tenants will pay for the property in full, and he’ll basically have an entire college fund along with the cash flow at his disposal!
Now scale that scenario up to a 40 unit building – all you have to do is add a zero, the principles are the same! It is possible for you to create wealth for yourself through the purchase of an income-producing multi-family building just like we did and be on the path to greater cash flow and net worth.