Why Investing in Turnkey Real Estate is Better Than Getting Rich Quick

Posted by Chris Clothier on Fri, Nov 16, 2018

turnkeyrealestate-realestateinvestment-getrichquick-smartinvestingThere’s a chance you’re rolling your eyes at the idea that anything is better than getting rich quick. After all, the sorts of schemes that make those promises have duped millions for years. They’re irresistible because they promise fortune without effort. The bad news is that they never work. Whether they’re secretly riddled with risk, run by dreamers wearing rose-colored goggles, or nefarious pyramid schemes, getting rich quick is never what it’s cracked up to be.


Turnkey real estate investment isn’t going to make you rich quick.

This can seem disappointing, but, in reality, when you step back and evaluate this approach to wealth-building, it’s among the smartest for the long-term gains it offers.

Here’s what you need to know.

 


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4 Reasons Turnkey Real Estate Investing Makes Financial Sense

You’re looking at your long-term.

When you invest, you want to do so with your long-term financial future in mind. While it may be nice to get a paycheck every month from your investments, and cash flow is valuable, it is really the long-term returns that make the difference for your wealth. When we look at investing in real estate, it’s not about the check each month. It’s compounding that across multiple properties for ten, fifteen, twenty years, and more—combined with the appreciation of your assets. All of the factors converge to create real wealth. Even just your year-end makes a big difference when you combine the factors of cash flow, debt paid down, and appreciation.

As a buy-and-hold investor, you are not depending on factors that fluctuate, such as shifting market values and waiting on the perfect times to buy or flip and sell properties. While you enjoy and reap the benefits of gains in the present and use them for your strategic advantage, you are ultimately using them to leverage your long-term gains.

Related Article: How To Build and Protect Your Million Dollar Passive Real Estate Portfolio


You’re investing in lasting assets.

A general advantage of investing in real estate regardless of strategy is the fact that you’re investing in a tangible asset. Traditionally, this has provided significant advantages over investing by other means, like stocks. For example, investing in real estate makes it much more difficult to be defrauded simply because it’s an easier asset to verify. Because it physically exists, you can visit it, inspect it, repair it, run background checks on the residents, talk to property management, and more. When it comes to stocks, you really have to rely solely on the word of auditors and management. History has shown us that this is not always reliable.

Then there’s the issue of leverage. Because you can borrow against your debt in real estate investment, it becomes much easier to scale your portfolio and grow—this is a time-tested strategy that is much safer than trading on margin on the stock market.

Lastly, real estate helps hedge against inflation in the event that the U.S. dollar loses some of its might. How? Real estate works as a hedge against inflation in that as inflation hurts the worth of the dollar, it typically raises the value of things like real estate, or, at the very least, maintains its value. So while your capital alone may suffer, owning real estate in these times is highly beneficial.

You don’t take on unnecessary risk.

One of the surest ways to secure your financial future in the long-term is to manage your risk well. In many investing methods, risk can easily spiral out of control, particularly in real estate investment where there are so many factors at play. In a fix-and-flip method, for instance, there is so much room for disaster—costs can get out of control and there is no guarantee the property will sell or meet your ROI expectations.

In turnkey real estate, your risk is managed through your turnkey real estate company, who carefully investigates every market you participate in any property that you may buy. Before you ever consider an investment, a considerable amount of work has been done to ensure your success. In the same way, your property management team ensures that your risk is mitigated in the long-term by dealing with resident issues and ensuring property condition is maintained over time.

You’re working in a sustainable model.

We’ve already discussed the fact that turnkey real estate investment is all about looking forward. You won’t get rich quick, but you will ultimately enjoy a model of investment that, if applied properly, brings about gains that will secure your financial future.

What is also important to remember about turnkey real estate is that this model is sustainable in more ways than one. Because it is passive investing, there is nothing to keep you from doing it as long as you please and on into your sunset years. It doesn’t matter how physically fit you are. You don’t have to be able to check in on residents or be there for demolition day at your latest property. Because you can rely on the expertise and skills of others, your investments can be sustained beyond your circumstances and limitations.

When we consider the model itself, we see sustainability in that turnkey real estate investment favors smart, steady property acquisition. It is about growing your wealth over time through a targeted strategy with the help of your turnkey partner. Because you have this team of experts on your side, there is no lack of resources, no lack of contacts, and no shortage of help when you need it.

The idea of getting rich quick may fill your heart with yearning, but in practice, it almost always leads to loss and disappointment. What’s far better is setting your sights on proven, time-tested investment strategies with undeniable results.


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Topics: build long term wealth, investment strategies