Creative Real Estate Investment Strategy

by : Matthew Soren



One of the best ways to increase profits on as many properties as possible is to use a creative real estate system with strategies like assignments, subject to, foreclosures, and lease options in conjunction with one another. Once you learn each of the individual strategies, you can begin to apply them in conjunction with one another. This will help you avoid a lot of the pitfalls and scam tactics along the way. You will also have a lot more flexibility while limiting your risk substantially when you do this. Below are few examples of strategy combinations you can use in any market, whether up, down or flat.

'Subject To' and Lease Options

You can gain control of a property using a subject to arrangement, then lease option the property for higher rents, more cash flow and a higher purchase price. (When someone is leasing to purchase instead of just renting it is typical that they will pay more for rent and have a higher purchase price then an outright buyer)

'Subject To' and Foreclosures

When you find an owner in preforeclosure, you can gain control of the property using a subject to arrangement, then bring the loan current by selling, renting, lease optioning, or assigning the property to another buyer or investor.

Foreclosures and Lease Options

When you get a property in foreclosure (and maybe you even negotiated an additional discount using a short sale) you can then lease option the property for higher rents, more cash flow and a higher purchase price.

Lease Options and Assignments

You can gain control of a property using a lease option as a buyer, then assign that right to another buyer or investor.

Foreclosures and Assignments

You can tie up a property in foreclosure by getting it under contract at a lower purchase price (and even negotiate an additional discount with a short sale) then assign that right to purchase the property to another buyer or investor for a fee.

Other Combination Strategies

You can use a number of different strategies in conjunction with one another. For example, you may find a property that needs a lot of work, then rehab the property and lease option it for a higher purchase price and rents. The same principle can also apply to single family homes by doing lease options instead of traditional rentals. These are some additional ways to increase profits, cash flow and long term growth.

If you are buying and holding properties make sure you're in a market that supports it. You will not want to hold properties that are losing value because of a market decline (unless you're getting enough monthly cash flow to justify it). This is why faster, lower risk, strategies as described above are better to use for flat and down markets.

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