Top Secrets to Build a Rental Portfolio That Grants Financial Freedom

Real estate investing is a great way to build wealth that'll last long into retirement. But it takes more than one property to reach the point that your rental property business is generating enough income to support your dreams.

While owning more than one rental property may seem daunting, the truth is that it is much more attainable than many new investors initially think.

Today we are going to share what I and my good friend and president of Calhoun Ventures, Nate Armstrong, have to say about building a rental portfolio that will grant you financial freedom.

WHAT DOES IT TAKE TO BUY AN INVESTMENT PROPERTY?

The process for buying investment properties is straightforward.

Even for those just starting their real estate careers, understanding what needs to happen in order to secure a rental property is easy, once you know the following steps:

1. Get Pre-Approved. The first thing you need to do before anything else is get pre-approved with your bank or lender. This step is important in knowing how much you can afford, before falling in love with the perfect property. Don’t forget to have a down payment – the typical requirement is 20% when it comes to investment property loans.
   
2. Find a Real Estate Agent. The next step is to find a reliable real estate agent to help you with buying your property. Get recommendations and always research your agent before hiring them.
3. Define Your Goals. When you meet with your real estate agent, make sure they know exactly what type of property you are looking for, and what you can afford.
4. Start Looking. View as many properties within your budget as you can to find the right one to meet your investment goals. In addition, consider ones that may need a little TLC. You may be able to renovate an older property and make it spectacular, while also getting a killer deal on it.
5. Do the Math. After you find a property that is within your purchase price budget, sit down with a calculator and figure out whether you can expect to generate a profit or not.
6. Negotiate the Purchase Price. The key here is to never overpay for a rental property, no matter how much you love it.
7. Order an Inspection. Always hire an inspector to ensure the property is in good condition.
8. Close the Deal. Sign the paperwork and close the deal on your rental property.

The process is easy to follow and should be done this way every single time you purchase a rental, whether it’s your first or your fortieth.

HOW DO YOU KNOW IF A RENTAL PROPERTY IS A GOOD INVESTMENT?

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