Alternative Real Estate

Real Estate

Real estate investing has long been one of the best ways to create wealth over the long-term.

The main problem with a real estate only investment strategy is that you are making it WAY harder on yourself than it has to be.

My Friend Chaz

He's a real estate investor in Colorado and I met him several years ago.

He and his partner contacted me for advice on growing their fix & flip operation.

So, I helped.

And then Chaz flipped 100 houses in 6 years.

And it nearly killed him.

Literally.

So, we chatted again about how to get him off that crazy roller coaster (and his blood pressure meds) and we settled on an alt investing strategy that is perfect for him.

And now he averages 16% returns as a private lender. By pushing a button. On his phone.

Back in the olden days (before May 2016), regular peeps like Chaz couldn't access “alternative” investments.

It was the same old boring stocks, bonds, and mutual funds that everyone and their Aunt Sally had access to.

Then, when we wanted higher returns, many of us turned to real estate.

And real estate is great, but most of the strategies require a TON of work and cash to make any money.

Been There; Done That

I've personally closed 612 real estate deals and raised $30.6 million in capital to fund them.

I've fixed and flipped houses, been a landlord, run a mortgage company, put together multi-million dollar investment funds to buy commercial real estate…

… and the honest truth is that I don't want to work that hard to make money anymore.

And neither should YOU.

Here at the Investor Insights, I used to blog and teach only about the traditional real estate investing strategies.

Now, there are so many ways to make the same return (or more) for much less work, that I rarely even mention the old ways anymore.

So, How Do You Make Truly Passive Profits In Real Estate Now?

Several ways…

  • Making private loans to other investors who are doing the hard work
  • Investing in other people's real estate projects via crowdfunding platforms such as RealtyMogul.com, RealtyShares.com, and FundRise.com.
  • Turning your single-family rental portfolio into a cash-flowing note portfolio by selling your properties with owner financing. (Even if they have mortgages – you just wrap them).
  • Buying cash-flowing, turn-key rentals which are 100% managed by someone else as part of the deal.
  • Acquiring an apartment building via a master lease and option agreement, having it professionally managed, and collecting passive cash flow.

The bottom line is that none of these opportunities require you to set up a real estate investing “business” with all that entails.

No big marketing effort, no begging banks for loans, no borrowing money from friends and family, no managing contractors, or sub-contractors, and absolutely no dealing with the terrible T's: toilets, tenants, and trash.

The beauty of ALL of the alt real estate investing strategies I've mentioned is that you can invest with just a computer and phone.

In this modern model, we work smarter, not harder.

Let's take the subject of turnkey rentals, for example.

I know several people who sell turnkey rental properties… Ron Phillips, Mark Evans, Clayton Morris. And even companies such as Roofstock are getting in on the model.

Take a look at a few properties Roofstock currently has available…

roofstock turnkey rentals

Heck, I'd take $68k out of my IRA, buy the Savoy Street property and enjoy the 16% yield. And I do mean enjoy!

Then I'd head over to RealtyMogul.com and invest $1,000 into their REIT (you don't even have to be accredited).

realty mogul reit

And then I'll invest in a few more apartment buildings like this one that paid off WAY too fast a few years ago.

That's an annualized yield of 9%. With no “work” on my part. Just pushed a few buttons and made money.

If you have an existing rental portfolio and want to keep the cash flow but eliminate the hassle, you can do what I taught my client Steve D.

Offer them for sale with owner financing.

Most people freak out when I talk about this for some reason but it's super simple.

How to Go From Landlord to Banker

Let's say you have a house with a market value of $200,000 with a mortgage from a bank of $150,000.

You can offer the house for sale at $200,000 with 10% down and owner financing of $180,000 that “wraps” the $150,000 existing mortgage and a new 2nd mortgage you create in the amount of $30,000. The interest rate you charge is 6.5%.

Let's look at the numbers…

When you sell it, you get $20,000 cash and a monthly mortgage payment from your “borrowers” of $1,138 a month.

Let's say your underlying mortgage on the $150,000 is 4% and your payment is $716.

So, for year one your profit is the down payment ($20,000) plus the difference between your underlying mortgage and what you collect on the new wrap mortgage ($422/mo)…

$20,000 + $5,064 = $25,064.

Now you've literally turned an annoying rental into a hands-off, passive cash cow producing $25,064 every year for you.

Do that three more times and congrats, you're earning 6-figure passive profits!

The bottom line is this, friend…

Don't make this harder than it has to be.

Here at the Investor Insights, we are totally into passive profits.

I talk (and write) a lot about passive real estate investing because I love it and I publish a premium real estate investment newsletter you can learn more about here.

Be sure to watch the blog for great alternative real estate investing tips, tactics, and portfolio updates.

And consider joining our alternative investing club, Investor Insights Elite, to get access to bi-monthly training courses, weekly live coaching calls, vetted resources, networking, and more. Check it out for here.

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