I stumbled onto the idea of buying cashflow properties several years ago. I went to a nationally real estate weekend seminar which turns out to be one of my wisest decisions of my life.
To this day, I still remember their vivid pitch on how cashflow properties make you money and allow you to achieve financial freedom. I certainly won’t argue with that. =) The business is REAL.
Fast forward those few years, I spent a lot of time reflecting my business as a whole. It brings me money, no question to it. I asked myself: “Is there all there is to it?” Is money the only drive that I perform the cashflow properties business?
Later on, as I give this idea more thought, I find a deeper meaning in running this business. I find there are more to it than just chasing the dollar sign. This article shares with you what cashflow properties have done for me as well as for others.
What Exactly is Cashflow Property?
When I say cashflow properties, I mean income-producing real estate that put money into your pocket after all costs to maintain and finance the properties. They can be residential buildings, storefronts, or even cemetery burial plots!
Main source of income is rent from tenants. Expenses are things like water, electricity, fix up, mortgage payments etc. Of course, income must be MORE than expense in order to be classified as a Cashflow Property.
How Do Cashflow Properties Benefit ME?
I’ll be honest. What got me started with Cashflow Properties is money. I wanted to make more money. Dead simple.
Cashflow properties deliver that. Cashflow properties are like ATM machines. They give me money every month. Each month I collect rent, pay off the expenses, and the rest is mine to keep.
Does it sound good to you? Imagine you have extra $500 a month that comes into your bank account. What if it’s extra $5,000 per month, or $50,000? Now you have a problem to deal with =)
Some decide to take their family to an extra vacation. Some decide to quit their job and pursue their personal interests. Some decide to jump into this even further, building a real estate empire, and looking to become the Next Trump.
Whatever you decide to do, it is you who decide. Not your boss. You are your own boss! Cashflow properties buy you freedom to do just that.
Another benefit that cashflow properties bring is security--financial security.
As I wrote this article in 2014, the economy is still recovering from the deep financial trouble that it sank into several years ago. Layoffs are happening left and right. The “lucky” ones, the survivors, hang onto their jobs that are not secure anymore.
If you have a job, and one day your boss fires you (for whatever reason, or without reason), you will lose 100% of income within a blink of an eye. Yes, ALL income will be lost instantly. That’s how much security a job provides.
You can try to have more than 1 job. In case one doesn’t go well, you have a backup plan. There are only so many jobs that you can do because we all only have 24 hours a day.
What if I say you CAN have ten “jobs”, which gives you ten sources of income? And those “jobs” will make you money even when you are not working?
It is POSSIBLE when you own cashflow properties.
When you own 10 rental units, each unit gives you a paycheck every month. That gives you ten sources of income. Rent money will come in every month, whether you work or not.
Problem solved. That’s the beauty of cashflow properties.
Another security feature of owning cashflow properties is that you no longer have to worry too much about the state of the economy anymore. Whether it is good times or bad times, people still need places to reside in. In fact, a down economy can benefit property owners like you. In a tough economy, with banks more reluctant to lend money and with people with less disposable income; few would be able to afford buying homes. This means you have even more renters to choose from.
How good will you feel when you know you always have enough to pay your bills, to buy things that you desire, and to live in an abundant life?
How Do Cashflow Properties Benefit EVERYONE ELSE?
I learned everything above in my very first real estate seminar. Essentially, it is all about what cashflow properties can do for you.
It makes you money. It buys you freedom. It provides you security.
TRUE. TRUE. And TRUE.
But as you think deeper, cashflow properties do more than providing nest eggs for yourself. Owning cashflow properties have deeper meanings to it. You are serving the others. You are making a great social contribution.
PROVIDE Lovely Homes
First, you are providing safe and desirable places to live which are one of the primal needs of human beings. Just earlier today my rental agent told me that a BIG reason why she likes to be a rental agent is because she has so much satisfaction in finding quality housing for people in desperate needs.
A lot of her clients are single mothers with little income. Even though the relationship with their other half doesn’t work out, they all want their best for their children. My real estate agent helps them navigate the whole process to look for landlords like me with houses that accept government-subsidized housing. For the mothers and their kids, it is a great step forward as they are able to move to a safe environment without the constant fear of disturbance from some degenerate neighbors. In fact, a lot of times her past clients will go back and thank her. For you, as a property owner, providing an opportunity for others to seek for a better living environment is a great contribution to the society.
SOLVE Our Unemployment Problem
Desire to help our country’s unemployment issue? As a cashflow property owner, you can!
From cleaning garbage to mowing lawn, to changing locks, and to making any other necessary repairs, you can create a lot of work opportunities for others.
In America, because of the financial crisis, we have been plagued by unemployment for quite some time. At present, in my area, the unemployment rate is 8% which represents thousands of people being desperate for jobs.
Not that people don’t try to find work, they certainly do. Recently, on a Sunday late night, around 9pm or so, I posted on Craigslist looking for some basic landscaping work for the following morning. Within an hour, more than 5 people gave me a call to see if the job was available or not. How often do you look for work on a Sunday night? I was happy that my post had received quite a feedback, but also sad at the same time about the tough economy that we are currently in. We are talking about capable, willing-to-work people, who simply need a little bit more opportunity!
As landlords/landladies, we can help!
One day, I hired a new handyman to work on my lawn because my original one wasn’t available at that time. As I was paying for the completed work, he thanked me profusely because he had been without work for several months! He talked about that he had been looking for work, but just could not find any. Looking through his eyes, you could tell he was genuine. I can’t solve all the problems that this country has, but even though one thing I do know is that I am certainly honored to make an impact on his life.
So should I do this cashflow properties business for myself or for others?
My answer is: “Does it matter?”
The long answer is no matter what the intention is, the impact is the same – a cashflow property business is a profitable business that provides real value to the society.
Say your primary focus is self-interest and money-driven, you will still have to provide quality products (ie. nice housings) for tenants or else they will not rent (and no income for you). On the other hand, even as your main purpose is to serve others, if the properties don’t generate cashflow, the business won’t even be sustainable.
Think about it. How many houses can run if they lose you money every month? Maybe a few. How many houses can you run if they make you money every month? As many as you want! If you want to create a good impact to your neighborhood, make sure your properties make money! You can donate all the money if you wish afterwards, but the houses need to be self-sustainable.
You and your society are interconnected. If you inject positive value to the society, you have no way but to receive value back from the society. Give, and you shall receive.
The most important takeaway is: With so many benefits of running a cashflow properties business, perhaps the most important thing is start doing it! Buy the properties right, maintain them right, and you will be doing just fine.