How to Build a Million Dollar Property Portfolio

9 Dec

And Make a Fortune From This Market Downturn

 

I’m about to show you in 3 steps how you can build a $2.4 million dollar real estate portfolio that provides roughly $2,400 a month cash flow and $600,000 of instant equity! 

Mike and I started buying properties in early 2003 and we built a residential real estate portfolio of approximately 120+ homes ($36,000,000).  I tell you this wasn’t easy, we hustled our butts off and many times worked 7 days a week.  When the prices started to rise monthly in Phoenix we decided to sell the entire portfolio.  In a very short time we and our friends and family made millions and millions of dollars.  Now lets fast forward to present day, we started buying again in early 2008 and so far own 50 cash flow properties for our own personal portfolio.  We believe that again the market will turn, maybe not like 2005 but it will turn for sure and we and our clients will make a fortune all over again.

Now let’s talk about you and how you can set yourself up to make a windfall from this market downturn using our program.

**Let’s make couple assumptions for example purposes: Each home purchased averages $200,000 in appraised value and your purchase price would be $150,000 (75% Loan to Value) plus the $7,500 down. Each property will cash flows about $200 a month**

Now I will show you how to amass a $2.4 million dollar portfolio that has $600,000 of guaranteed equity and $2,400 a month cash flow.

Step #1 

Get started with the Fortress Investor Program and buy at least 3 properties.  This will cost you roughly $22,500.  Now using the assumptions above you now own $600,000 of real estate that has $150,000 of guaranteed instant equity and $600 a month cash flow.

Quick Math: 3 x $200,000 = $600,000 x 75% = $450,000. 

$600,000 – $450,000 = $150,000 equity

Now under Fannie and Freddie’s current guidelines and investor can only have 4 properties on their personal credit.  So essentially 1 primary resident and 3 investment properties.  With this new rule you have to be creative to build a large portfolio.

Step #2

Share your experience with friends, family, relatives and co-workers.  You become the point man working with Fortress on the acquiring the properties and management company regarding the property management.  The goal would be to have 3 individuals that would buy 3 properties just like you have done.  I will show you how you will benefit in step 3, let’s do some quick math.

Quick Math: 3 individuals x 3 properties = 9 properties.  9 x $200,000 = $1,800,000

$1,800,000 x 75% = $1,350,000.   $1,800,000 – $1,350,000 = $450,000 equity

Here is how how you build a million dollare property  portfolio.  It gets a little complicated, so stick with me.

Step #3 

You will then purchase an Option on the properties for 75% of the value, splitting 50% of the profits with the Optionee.   In our example the option contracts would be for $150,000 each.   Within the terms of the option contract you will lease the property from them for the monthly fee equating to the real mortgage payment amount. This will allow you or the management company to collect the rents and manage the property.  You will pay the monthly mortgage payments as it’s agreed in the option/lease agreement and then you are able to keep the cash flow.  Now how much will this option cost?  Well it’s all negotiable but we have paid as little as $4,000 upward to $20,000 depending on the situation.  I would start out offering $7,500 so the friend/investor will have no money at risk.  This will cost some cash but no where near the amount it would cost using traditional methods of buying investment property.

Now let’s see what the end result is:

You own/control $2.4 million dollars of real estate that has $600,000 of guaranteed equity (plus future profits from apperception).  $150,000 of that is 100% yours and $450,000 you split with your investor/friend. In our assumption each property has $200 cash flow, so you would be collecting approximately $2,400 a month, $28,800 a year.

 

You can also build a property portfolio and keep the money in the family by leveraging yours and your spouse’s credit, check out the example below:

Build a Million Dollar Property Portfolio

 

This is really possible, we have done it and are doing it today.  If you have questions and are serious about diving into this model than give us a call at 888-643-0194 or visit Fortress Investments

Happy Investing

Sean 

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16 Responses to “How to Build a Million Dollar Property Portfolio”

  1. Althea_Wms926 10. Jan, 2009 at 2:06 am #

    I would like to join a real estate investment group in the North Carolina area. If you know of any groups that are looking for or are willing to take new members please send me the contact information or give me the information to contact them. You can contact by email at altheaf926@gmail.com. Please, I am not looking to buy books and manuals I have some of them. I am looking for a group of investors that are pooling their money as you talked about in the above post. Thank you in advance for any information you can supply.
    Althea Williams

  2. Sean Terry 30. Jan, 2009 at 5:01 pm #

    Athena,

    Check out the Robert Kiyosaki Cash Flow Clubs for your area. Sorry for the delayed response the comment didn't show up in my Wordpress dashboard.
    Thanks,

  3. Jordan 28. Feb, 2009 at 8:39 am #

    Hi, my name’s Jordan and I’m from Columbus, OH. My work requires me to always be traveling, and I was wondering if it would be possible for me to buy two properties in a 30 day window? I know there are a lot of steps within the process that require my presence, and didn’t know if I’d be able to squeeze everything in.

    Also, with the Fannie Mae 4+ Property Rule lifted, how does that affect the down payment that Fortress requires seeing as how there are new guidelines with the Loan-to-Value that is required? And if I’m not mistaken, the new down payment is $15,000, instead of $7,500, am I correct? Thanks for your answers, and your time!
    -Jordan

  4. Sean Terry 28. Feb, 2009 at 8:55 am #

    Hello Jordan thanks for the comment, buying 2 properties in a 30 day window is possible but difficult because the 1st deal would have to close before the 2nd deal could be submitted to underwriting. A 45 day window would be more realistic. What goal are you trying to accomplish? We are keeping the down payment at $7,500 as of right now, the LTV will still be 75%. If you want to move forward with our program please call Katie Yokose a State Mortgage to get pre qualified, her number is 480-648-220 or call me anytime if you need more info.
    Thanks Sean

  5. Lori 26. Mar, 2009 at 4:03 pm #

    Great blog BTW!!

    I’m more interested in multi family investing. Any suggestions on any great strategies?

  6. Sean Terry 26. Mar, 2009 at 5:55 pm #

    Hello Lori thanks for the comment, I’ll do a post just for you regarding multi-family properties. I’m finishing a series right now on how to go from $0 to $10K a month, once I’m done I’ll give you some tips and tricks on buying these types of deals. Are you looking for fourplexes and under or larger 20 units+? The financing is dramatically different which I’m sure you are aware of.

    Let me know,
    Sean

  7. Sean Terry 16. Apr, 2009 at 1:48 pm #

    Hello Lori, I just uploaded an article that I hope will answer your questions regarding multi family investing.
    Thanks!

  8. Rick Rector 24. Jul, 2009 at 12:35 pm #

    Looking for lender in Arizona with no seasoning rules. We have bought rehabbed and now want our money back to do it again. Any help?

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  10. Charlie Wilson 23. May, 2010 at 10:51 pm #

    Hi, is there some online seminars or webinars about Property Management on the internet?*..

  11. Ben Griffiths 27. Jul, 2010 at 6:03 pm #

    some insurance companies are very specific when quoting property damage, some won’t even pay a dime.*:,

  12. Gum Disease Symptoms 21. Dec, 2010 at 10:06 am #

    Duties of property management include accepting rent, responding to and addressing maintenance issues, and providing a buffer for those landlords desiring to distance themselves from their tenant constituency ;’,

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