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Why being the bank beats being the landlord!

In almost every market, real estate investors are facing a continuing shortage of inventory. It doesn’t take an expert to state the obvious: When supply is short, prices go up making it harder to buy properties at a discount.

But here’s what’s not so obvious. Data is showing that the people currently buying rental properties are 20-times more likely to be beginning landlords. The vast majority of rental properties are being bought by someone with very little landlording experience and it’s either their first, second, or third rental property.

The seasoned investors with five to twenty rental properties in their portfolio are sitting on the sidelines and not buying.

Why is this happening? I believe it’s because of price. Many seasoned investors think prices are much closer to the top of the market than the bottom of the market. The inexperienced investor has a higher tolerance for paying top dollar. The seasoned guys know full well how thin the profit margins can be.

So what alternatives are available to the seasoned investor if they don’t want to invest in more properties? I recommend investing in notes!

When you own the note instead of the property, it’s MUCH less work than landlording. Plus, you don’t have to pay property taxes, insurance, make repairs, or worry about destructive tenants.

Being the bank is not only less work, it’s less risk! You can sleep better, and earn a much higher return on your investment.

This short video is less than four minutes, and I explain more of what’s going on in the market and how you can start buying notes instead of overpriced properties.

I’m bankin’ on notes,

Eddie

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