Lets talk about how to retire early by investing in real estate, and this will will cover it all: real estate, passive income, financial independence, retiring early…and smashing the like button. Enjoy! Add me on Instagram: GPStephan
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So lets start here…this is where it all begins:
Add up ALL of your expenses. Then come up with an average number that you NEED to replace in income every month. Here’s your challenge: For the next 4 months, TRACK EVERYTHING you spend money on. Your goal AT FIRST should be to earn enough rental income JUST to cover your NECESSARY expenses.
Next, save up a down payment of about 10-20% of the properties purchase price.
And in terms of saving this amount of money, you NEED to make it a priority. If that means you cut back on vacations, take up a part time job, or scale back on your expenses just to save a little more - do it.
Now once you’ve got that down payment saved, the second step is to buy a 2-4 unit building that you can move into yourself.
Here’s why this step is so important:
When you buy a property as a PRIMARY RESIDENCE - meaning you’re going to move in and personally live there - you can qualify for what’s called conventional owner occupant financing. This means you’ll get a lower interest rate and you’ll qualify for a lower down payment, compared to buying an INVESTMENT property. The ONLY requirement when doing this is that you MUST live in the property for 12-24 months. After that, you can do whatever you want with the property - and meanwhile, you’ve locked in a low interest rate and a low down payment.
Third, IDEALLY you should fix up the property.
Any time you’re looking to not only increase the properties value, but also increase the cashflow…fixing it up is the way to go. My favorite places to buy are just the ones that look a little out dated. For someone just starting out, I don’t recommend you take on too big of a project. This should be something that would take any handyman or contractor under one month to do, from start to finish.
So now, what do you do once you’re done fixing it up? RENT OUT THE OTHER UNITS!
This is where the cost of the other units should ideally cover ALL of your property expenses…this includes your mortgage, property taxes, insurance, repairs, maintenance, and anything else that comes up.
You’re now going to do what’s called a CASH OUT REFINANCE.
This means your bank will give you a NEW loan, based on the new, HIGHER value of your property after you fixed it up…and you profit the difference in CASH.
This means you now can use that money to find ANOTHER place to buy because you have your money back!
The GENIUS with this concept is that if you just keep taking this extra rental income, and re-investing BACK into more real estate, you can start to see these numbers grow VERY, very quickly. Because now, in addition to re-using your own equity to buy more properties, you’ll have extra rental income every month to invest in EVEN MORE REAL ESTATE. This is just compound interest working on a very extreme level.
The ONLY requirement on your end, is to save up the initial down payment and renovation budget…NEVER spent the rental income while you’re re-investing it back into your portfolio, and put in the work to do this consistently until you’ve made enough rental income to cover your expenses.
So as you can see, this is such a great method for retiring early…as long as you decide to dedicate ONE DECADE of your life to doing this part time, you can be set for EVERYTHING after that, just by this!
For business or one-on-one real estate investing/real estate agent consulting inquiries, you can reach me at GrahamStephanBusiness @gmail.com
The YouTube Creator Academy:
Learn EXACTLY how to get your first 1000 subscribers on YouTube, rank videos on the front page of searches, grow your following, and turn that into another income source: https://bit.ly/2STxofv $100 OFF WITH CODE 100OFF (Limited Time Only)
Join the private Real Estate Facebook Group:
https://www.facebook.com/groups/therealestatemillionairemastermind/
Merch: http://www.GrahamStephanStore.com/
My ENTIRE Camera and Recording Equipment:
https://www.amazon.com/shop/grahamstephan?listId=2TNWZ7RP1P1EB
So lets start here…this is where it all begins:
Add up ALL of your expenses. Then come up with an average number that you NEED to replace in income every month. Here’s your challenge: For the next 4 months, TRACK EVERYTHING you spend money on. Your goal AT FIRST should be to earn enough rental income JUST to cover your NECESSARY expenses.
Next, save up a down payment of about 10-20% of the properties purchase price.
And in terms of saving this amount of money, you NEED to make it a priority. If that means you cut back on vacations, take up a part time job, or scale back on your expenses just to save a little more - do it.
Now once you’ve got that down payment saved, the second step is to buy a 2-4 unit building that you can move into yourself.
Here’s why this step is so important:
When you buy a property as a PRIMARY RESIDENCE - meaning you’re going to move in and personally live there - you can qualify for what’s called conventional owner occupant financing. This means you’ll get a lower interest rate and you’ll qualify for a lower down payment, compared to buying an INVESTMENT property. The ONLY requirement when doing this is that you MUST live in the property for 12-24 months. After that, you can do whatever you want with the property - and meanwhile, you’ve locked in a low interest rate and a low down payment.
Third, IDEALLY you should fix up the property.
Any time you’re looking to not only increase the properties value, but also increase the cashflow…fixing it up is the way to go. My favorite places to buy are just the ones that look a little out dated. For someone just starting out, I don’t recommend you take on too big of a project. This should be something that would take any handyman or contractor under one month to do, from start to finish.
So now, what do you do once you’re done fixing it up? RENT OUT THE OTHER UNITS!
This is where the cost of the other units should ideally cover ALL of your property expenses…this includes your mortgage, property taxes, insurance, repairs, maintenance, and anything else that comes up.
You’re now going to do what’s called a CASH OUT REFINANCE.
This means your bank will give you a NEW loan, based on the new, HIGHER value of your property after you fixed it up…and you profit the difference in CASH.
This means you now can use that money to find ANOTHER place to buy because you have your money back!
The GENIUS with this concept is that if you just keep taking this extra rental income, and re-investing BACK into more real estate, you can start to see these numbers grow VERY, very quickly. Because now, in addition to re-using your own equity to buy more properties, you’ll have extra rental income every month to invest in EVEN MORE REAL ESTATE. This is just compound interest working on a very extreme level.
The ONLY requirement on your end, is to save up the initial down payment and renovation budget…NEVER spent the rental income while you’re re-investing it back into your portfolio, and put in the work to do this consistently until you’ve made enough rental income to cover your expenses.
So as you can see, this is such a great method for retiring early…as long as you decide to dedicate ONE DECADE of your life to doing this part time, you can be set for EVERYTHING after that, just by this!
For business or one-on-one real estate investing/real estate agent consulting inquiries, you can reach me at GrahamStephanBusiness @gmail.com
This one is really good!!! I'm gonna take notes on this down for my real estate journey. Thank you, Graham.
Interesting video; I wish I had more time for experimentation, but I'll be 50 by next year, and I'm looking for ideas and suggestions on what investments to acquire to set myself up for retirement, especially with the looming inflation; my goal is to have at least $3 million by the age of 65.
If I buy New construction，it need renovation ？
Some great ways to invest in your 20s include investing in low-cost index funds, opening a Roth IRA, and investing in real estate. Compounding is the process of earning interest on your initial investment, as well as on the interest that investment earns. This means that over time, your investment can grow exponentially. So the earlier you start investing, the more time your investment has to grow through compounding.
I'm 48years old living in California, I'm hoping to retire at 50 if things keep going well for me. Bought my third house last month and I can't be more proud that am i now. I'm glad I made great decision about my finances that changed me forever but now I can't seem to make any other smart investment.
That was the single most in depth and easy to watch video on investing in real-estate ever… thank you
I think a housing crash will happen because all those people who bought homes over asking price, although it was at a low interest rate, they are over their heads. They have no equity if the housing prices continue to go down, and if for whatever reason they cannot afford the house anymore and it goes into foreclosure because even if they try to sell, they will not make any money. I think this will happen to a lot of people especially with the massive layoff predicted for the future and the cost of living rising at a high speed.
Has anyone tried this after three years of publishing?
This video is pure gold, it should be translated into more than 30+ languages for world's sake
This is a great explanation of how to capitalize on Brrr.
Despite the economic downturn, I'm having the best time of my life financially. Earning over $83k in the last 2months with an investment of $19,000. Money can be made even in a bear market. Make the most of it.
Thks for sharing the video. Its so informative especially to younger generation. Budgeting n savings is so indispensable to have this passive income for rental property to retire early.
On top of that u can also speed the process by not waiting 30 years and put more money down towards the house!
Hello Graham.
Im interested in real estate because it is a safer investment and as a beginner, what do I do first and where do I go to start?
Triplex in 2022 is $700,000 avg
I’m closing on my first duplex Aug 10th. 🥳
So when you do a cash out refinance your get a loan of 320. You pay out 270 and are left with 50. What I don't understand is how did you buy the new property with 320, because you only hqve 50 after repqying previous loan. However, you still show only one mortgage of 1600 which is incorrect because if you have to add previous 1330 to it which come out to be 2931.
someone explain to me how loans work in the US. In denmark I can take take a loan up to about 4x my yearly income. So it wouldn't be possible to pick up that second loan for me. what´s the ceiling for loans for an American?
I get that much between my SS and distribution from my 403b, without any risk from having a tenant who may or may not pay rent in this economy.
Nice
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Thanks for this! Agree!
I watch this video once a day so whenever ima buy my first house… 💰
Like it
Nice
💪
Wow. Thank you! Trying to get rich 🙏
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Wow good video 👍👍
rent for 1200
I like it
<totally agree with what you are saying. I started in trading in August 2017, and I bought in. I was up 5x by December only to watch that disappear quickly and then watch the original investment go down by about 85% during the ensuing 4 year bear market. I took the opportunity to accumulate more over the last 4 years which was hard to do and at the same time a smart thing to do. I wish I had bought more. I am in profit for now but I am planning on using my experience and what i have learnt from Mason Jianjun I have learned from you and other Youtubrs especially my mentor Mason Jianjun who taught me how to make trade and increase my crypto from 11 to 27btc that no one really knows what is going to happen in the markett …
Question: About the cashout refinance chapter— what about paying off the new loan that was used to pay off the older one?
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