3 Top Real Estate Investing Methods for Maximum Wealth

Real Estate investing can be used to gain wealth in three major ways -

1. Long-term Real Estate investing is most often utilized using appreciation as a planning tool.

Historically, Real Estate has doubled in value every 11 years (6% per year on average over the period).

Of course, not all areas have seen that much appreciation, while others (like sections of California and Nevada) have seen double or triple that rate, but overall, a 7-11 year cycle of doubling value has been the 'rule'.

So, a house worth $100,000 today will be worth $200,000 after 11 years (on average).

The best part about this plan (when it comes true) is that the debt on the house after 11 years will be less than the original $100,000 (because payments were made for all that time), while the property is worth $200,000.

The difference makes a great retirement 'nest egg'.

2. Instant cash is available in many types of Real Estate investing transactions where money is made within days or weeks (sometimes hours, and even minutes!) of the purchase.

These transactions are often referred to generically as 'flips' (a more detailed description of these transactions is given below).

When the money made from these transactions is used to reinvest in other ventures, the return rate highly exceeds any other method of Real Estate investing. The reason for this is that, on a property valued at $100,000, the purchase price is often 10-50% less.

With an example of 15%, the purchase price will be $85,000. Selling the property at a discount to another buyer for $95,000 will net well over $5,000 (after closing costs and all expenses).

The $5,000 used as investment money for another transaction will yield an additional discount on that property, and when you continue to 'roll' the money made from such real estate investing activities, you eventually lead to 'full cash' purchases, which is usually what is needed to acquire most 30% or more discounts from sellers.

This method of Real Estate investing (buying low, selling high and re-investing) yields extreme wealth - plus, the first property could have been done as a 'no money down' transaction!

Extreme wealth from nothing - where else can you find this except in Real Estate investing?

3. Cash flow properties are often used in cooperation with appreciation (one of the biggest benefits of Real Estate investing), however, is listed here as a separate system because many investors do not count appreciation into their calculations when purchasing a property.

Cash flow properties are those with some monthly income - that is, the difference between what is paid in and what is paid out. Traditionally, these are 'rental' properties, and bring in a constant flow of cash for the investor.

Sadly, many investors use this cash for their living expenses and never grow the wealth they could by simply reinvesting this money into another property.

Although slower than other techniques, this method of Real Estate investing can yield a very high rate of return for the careful investor.

Steve Majors - The Lazy Investor

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More than 40 states signed onto a proposed $25-billion deal with major mortgage servicers over faulty foreclosure practices. New York, Nevada and Delaware joined California in holding out for better terms.

More than 40 states signed onto a proposed $25-billion settlement with major mortgage servicers over faulty foreclosure procedures, but California, New York and other key states were still not among them.

California has until Monday to share in a multi-state deal with banks to obtain mortgage relief and reforms. Atty. Gen. Kamala Harris, who walked away from talks last year, says the door remains open.

With a Monday deadline at hand, California officials have resumed direct talks with the Obama administration about joining a multibillion-dollar, multi-state mortgage settlement with the nation's largest banks, a source said Sunday.

The talk show host pays $12 million for the 4,088-square-foot house with four bedrooms and four bathrooms. The ocean-view home sits on 1.26 bluff-top acres with beach access.

In one of the more talked-about transactions in town, actors Brad Pitt and Angelina Jolie have sold their Malibu beach house to daytime host and comedian Ellen De Generes for $12 million.

The four-bedroom, five-bathroom house built in 1920 for industrialist James Wigmore lists for $2,875,000.

A decorative cast stone entrance opens to this restored Spanish Colonial Revival-style house in Pasadena's South Orange Grove area. Built in 1920 for industrialist James Wigmore, the house retains such original details as coffered wood ceilings and arched doorways.

They don't believe they can sell their property for what it's worth, so they're spending money on making their homes more comfortable.

Do you fit any of these descriptions?

A biennial research report by the National Assn. of Realtors indicates that a handful of real estate agents and brokers and their clients either don't know the law or don't care to follow it.

When it comes to lawsuits, real estate agents and brokers tangle mostly among themselves.

The president aims to help about 3.5 million people with good credit who are unable to refinance at historically low rates because their homes are worth less than their mortgages.

 

The White House hopes to help millions of homeowners lower their monthly mortgage bill with a $5 billion to $10 billion plan to set up a streamlined refinancing program for people who are current on their payments.

The Standard & Poor's/Case-Shiller index of 20 large U.S. cities fell 1.3% in November from October as foreclosures continue to drag down the housing market.

Three straight months of home-price declines in the biggest U.S. cities showed that foreclosures remain a significant drag on a housing market that is entering its fifth year of deterioration.

L.A. Clipper Chris Paul may be quick down the court, but he moves pretty fast when it comes to buying multimillion-dollar real estate too.