When you are analyzing a property, I want you to keep in mind that you do not invest your money in Real Estate. Sure, you may write a check initially or you may put a down payment down for a loan; but you are eventually either going to sell that property, re-finance it or get your cash back.
So remember, you are not going to invest your own cash long term in real estate. You invest your knowledge in real estate and real estate will pay you back with cash. Which is basically called infinite yield investing. Meaning you are getting your yield on the property, you have created an asset, you have equity, you have cash flow and you have zero money in that deal after you have fixed it up and re-financed it. That is called infinite yield investing, so don’t invest your money in real estate, invest in your real estate education and then you can invest your knowledge back into real estate and the real estate will pay you back.
Remember that equity doesn’t mean anything until you can convert it to either cash or cash flow. Remember to keep this knowledge in the back of your mind every single time you move to invest in a property.
I hope you have enjoyed this article taken from my course called the Ultimate Buying and Selling Machine, which teaches how we buy and sell 10-30 properties a month from our office in Lake Wylie, SC.