How To Build Your Asset By Renting Your House Out

I wanted to talk really quickly today about renting your home out. I don't mean renting your home out when you live in it right now and then renting it out to somebody. I mean, you want to sell your home, but you think, "You know what? Maybe I want to start building my asset column and I want to rent my house out."

It's a crazy market for rentals

Here's all these Michigan, there's really a lack of inventory. So it's making it hard for sellers to go find a new home. So it's keeping a lot of sellers indoors and keeping them from doing what they want to do. So one of the ways around that is to make your home a rental. Right now, rentals are just crushing. The rental mortgage ratio is insane. I don't have the exact number on me. It's not gonna necessarily mean much to you anyway.

It's an awesome way to start building wealth, to get taxes on your side and start keeping more taxes using depreciation, amortization, cash flow, appreciation, stuff like that to your advantage. So that is a big thing. We have a number of people that have done that in the last year or two since inventory is so low, it's been really hard for people to go find a home and then they only want to sell their home. So are trying to find a home, right?

Property Management

So one of those ways that you can do it as I said, is renting your home out. It's an awesome option. Something that hopefully you might have thought of before. If not, you would love to answer questions about it and what that looks like. Obviously, one of the biggest things is property management. Property management is one of the biggest things. Like 90% of our rental real estate and investing in real estate is property management. Investing in real estate is not flipping homes. That's just gambling. That's trying to prognosticate and guess what's going to happen to the market.

Real estate investing is actually investing in notes, tax liens, stuff like that. Investing in an apartment complex is self-storage, things like that. That is investing in real estate. So, how can you start turning the tax advantage around into your own advantage? How can you become your own bank? That is what I love talking about the most actually.

Buy and rent it out

One of those ways you can do that is using your primary. I know a handful of people who have literally bought their primary home and then sold it a year or two later and to have done that five times. They have five rentals and they just keep doing that over and over and over again. In 10 years, 15, 20 years, they are going to have 10 rentals at 30 years from now, all paid off. Say it's bringing $1,000 a month, that's going to be $10,000 a month cash flow, probably tax-free as well.

Knowing your options

So that is the power of rental real estate and what it can do. It doesn't have to be some crazy, elaborate scheme like you see on late night infomercials and stuff like that. It could be as simple as saying, "You know what, we're not going to sell this home. We're going to go buy a new home. We're going to go somewhere else and we're going to rent this home out." You'll get creative. Think about things that you can do differently and instead of just doing what everyone else does or what you've seen growing up or I would say taught school, but we weren't talking to any of that school.

Like I said, if you have any questions about that, let me know. Fire them my way. I appreciate all the DMs and stuff, but if we can keep them on the thread, that'd be amazing. That way I can answer them and we can learn all together. We've had a number of people do it. As I said, I have a handful of people that have done that over and over and over again and have built up a nice rental portfolio just by doing that. Not even going outside anything that they didn't know previously.

So turn those primaries into rentals and you're gonna see your tax demand just skyrocket. You're going to be really happy with yourself, 10, 20, 30 years from now setting yourself, especially if you're under 40, 50 years old. I mean, you're going to be absolutely loving life when it comes to retirement. You do not have to worry about social security, not going to worry about 401k, anything because you're going to have positive cash flow coming in every month from paid off rentals and they're gonna be managed properly. We have a number of people that we refer out for property management. However, I always suggest people do their own homework obviously with property management. That's the number one thing really - it's the property managers taking care of your assets. What are the property managers doing to take care of your asset? Increase the value of your asset and pay you a month in, month out.

I appreciate you guys. Your time and energy are the most important assets that we do have, talking about assets. So I appreciate that and you spending with us, I'm just humbled and honored to have it. Let me know what questions you have. Please shoot them in there. If you're on the podcast, please just go to our YouTube channel or Facebook (@legacygroupmi) and put your questions there so we can answer them. So I appreciate you guys more than anything and we will see you very soon.