Making 6 figures in real estate

[Stephen Michle]

Hi guys,

Came across this great article about how to make 6 figures in real estate. Take a look at the link and the pdf link. Tell me what you think, honestly I think this would be good not only for beginners but also seasoned investors no matter where we are. Check it out

http://investingarchitect.com/how-to-create-a-six-figure-income-with-real-estate-investing/

http://investingarchitect.com/wp-content/uploads/2012/07/Domino-Effect-on-a-Real-Estate-Portfolio-of-9.pdf

I don't quite fully understand the second link. Anybody want to shed light on that ?

Steph

[Keanne Henry]

Stephen,

The second link is a diagram to illustrate the domino strategy described in the first link. In the example, the author has a goal of owning 9 free and clear properties that each produce about $11,000 in income. He starts by buying 9 cashflowing properties with 20-25% down on each property. Each of them has a monthly payment of about $515 per month. He uses the cashflow to aggressively pay down the first house. By paying $4015 per month on House 1, he is able to pay off the mortgage in 27 months. During this time, he is just paying the regular payment on the other properties.

Once House 1 is paid off, the mortgage balance on House 2 is down to $100,000. He again uses the cash flow (probably the same $4015 per month) to pay down House 2. This takes 23 months.

Once House 2 is paid off, the mortgage balance on House 3 is down to $97,086. He uses cash flow to pay down House 3 in 20 months. By repeating this approach of using cash flow to pay off the mortgage balance, it takes a total of 149 months to have 9 free-and-clear properties that bring in about $100,000 in income.

Hope this helps,

Keanne