Zero Real Estate? Simple Formula to Million Dollar Portfolio

[Michael Vallee]

Recently, I was perusing through several profiles here on Bigger Pockets and I commend all the interest in Real Estate and getting educated, but at the same time I was AMAZED at how many people are merely "interested" but have yet to actually own any real estate. Let's Remedy That! 

Do you want to know "how" through a simple formula? Then follow along and I will explain how I built two 7 figure plus real estate portfolios - one pre-2008 and one post-2008.

Although I don't see what I've done as anything special, that always seems to be the case "after" we have done something.

I'm a big believer in mentor-ship and my mentor taught me this formula early on about 15 years ago now that has served me well and I envy those of you without any real estate, because this formula

works even better! (I'm speaking to those without any real estate and if single/flexible - even better!)

The easiest form of financing is for Owner Occupied...So, are you ready? It's Simple, so can be easy to miss...

Step 1 - Buy the very smallest unit you can purchase and live in it. If renovations, modernizing, is available even better - also, always looking to purchase the lowest priced property in a community and add value to match the highest property.

SO, this maybe a Studio or small 1 Bedroom 

Buying owner occupied is the "intent" to occupy - (1 year is the full seasoning of this commitment, but I've moved out sooner due to circumstances)

Step 2 - Buy property #2 that is just slightly larger or that is justifiable to the bank as to why you now need to buy this 2nd property - can be another 1bedroom condo..THEN, Rent out the 1st property

and BAM! you should be able to have cash flow plus the place you live in, most importantly you just opened up appreciation, tax benefits and other benefits of having a rental. 

Step 3 - Buy property #3 that is just slightly larger, maybe a 2 bedroom, because now you need an office for your real estate empire! rent out property #2 as well...

Continue this through condos, then small house, larger house...you can supplement non-cash flowing rentals by Short-Term Rentals as well. 

Keep going - I had 10 units at one time and if say you own $1,000,000 in Real Estate and that appreciates at 8%, then you've made $80,000 passively on paper...the banks like you go

up in size of units, but not down. The real estate purchases need to make sense to the bank. 

I did get a bit of haircut during 2008, but have since rebuilt, with more of a focus on Cash Flow and

this has served me very well.  

I'm available to answer any questions on this formula, as I did it twice, so proved

that it works in two different markets at two different times - both Seattle and now in Arizona.

When in doubt - Buy "something" is what my mentor use to say, because the reality is that

if you looked at 10 properties and bought one of them, they all would have benefited you, just

at varying degrees...ultimately he said - buy 20 properties, then use the first 10 to pay off the last 10 you purchased and you will have cash flow the rest of your life and be FREE.

Have multiple holdings? Well, that is a new set of challenges...which I can share ways around as well.

All my best - let me know how I can assist you in achieving your real estate goals! Even if that

is to get started...

Michael E. Vallee

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