The Secret to Financing Multiple Properties; Proven Strategies

by James L. Hardcastle

Anyone who lives in Melbourne Australia can tell you the housing market is on the rise. The time to do real estate business here is now. Maybe you have already purchased property in Melbourne, and now would like to buy more. What is a good way to finance such purchases? In this article, you will receive a few tips on how to use proven strategies for financing multiple properties.

Anyone can take advantage of these strategies. From the minor property owner with one or two rentals to the major movers and shakers with property on every corner. In truth, the latter group is probably already proficient in this type of financing. Moreover, what better time than this when Australia’s real estate market is on the rise?

The top ways of affordably investing in multiple properties is to: a) buy fixer-upper properties that you can get cheaply, then turn into huge ROIs; and b) use the proceeds from one sale to finance your next purchase(s). With a little creativity, you can leverage the equity you have in your current real estate holdings to greatly expand your assets.

For instance, let us assume you currently own three properties free and clear; that simply means no loans or mortgages. Let us further assume the market value of owned property is $100,000 each. Now a lot of people would prefer to sell these to finance future endeavors. However, that is not really building a real estate portfolio is it? The idea is to continually grow your holdings.

The better plan is to find the undervalued homes on the market. You may know these better as potential flips. Your current property may even be a flip that you have not turned yet. Of course if you have operated strictly as a landlord then this idea may be foreign to you.

You may already know all about this process and if so, you are ahead of the game. At any rate go out and begin putting together deals to purchase this kind of property. This could take some time since these are not on every corner; once you have your deals assembled, you are going to take out a home equity line of credit on your existing real estate.

You’re going to use all of this money to buy and fix up the three flipper properties. Now, you’ll want to make sure that you’ve done your homework in advance. You need to have accurate estimates of how much it’s going to cost you to fix up each property and how much you’re realistically going to be able to get for them when you sell them.

One caution here, though. You will need to be careful when making the deals. Do your homework on the properties to flip and research the people you are dealing with. You do not want to have your home equity sunk into a white elephant. Once the dust settles, you should have several great homes that you can either reap residual income from or sell one or more outright and receive a lump sum for the bank while paying off all the debt you incurred on the flips. An independent financial advisor can be a priceless assistant.

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