I recently did a video from the Bahamas. I was celebrating my 31st Birthday after securing a property deal in Miami. While I was there, I realised something; the rich people in the Bahamas, Mexico and the USA are all buying property in the exact same way. In fact, the rich all over the world are doing something that the middle and working class don’t have access to and don’t even know is an option.
When I got started out in business, I was unaware of all the ways the wealthy buy real estate. But now that I am rich myself, I have access to these strategies. It has always been my mission to open up the world of property investing to ordinary people, so I decided to explain what the rich are doing. You can see my full explanation in the video above. In this article, I am going to briefly outline what the rich are doing and how I am hoping to open this strategy up to you, even if you don’t have the money to invest.
The Rich’s Property Strategy
When I was in Miami, I was told the only way you are going to get a good deal in this booming market is to pay cash. The ability to buy properties for cash is the advantage that rich people have in negotiations. The middle and working class can’t afford to buy a property for cash and therefore cannot even compete in this market. This means the rich can get big discounts on property that are simply not available to the average investor.
Once the rich have bought the property for cash, they then get a mortgage on the property so their capital isn’t tied up in the investment. This may take 6 months to do, but they can end up with most of their capital back.
Let me explain how this works. Buy-to-let lenders will normally give you a mortgage for 75% of the value of the property. They will base this on the true market value of the property, not what you paid for it. This means that the mortgage will be for much more than 75% of what you paid because of the aforementioned discount for buying in cash. Therefore you can take your capital, returned in the form of a mortgage, and invest it into other cash deals.
Let’s Joint Venture
You are probably thinking that this is all well and good for the rich, but you can’t afford to buy properties for cash. If you had the cash right now, you would be out there making deals and growing your money. You might be wondering why I have even told you all this but, trust me, you will want to keep reading.
I am thinking about doing something this year that is a bit crazy. It is going to be my way of giving back, but also making money at the same time. I am looking to lend my money on other people’s deals.
Here’s how it could work. You will negotiate to buy a property for cash and get a good deal. I will lend you the money for the purchase. Six months later, we will refinance the property and I will take my money back. Then we will keep the property together and share the cashflow. If that sounds like something you would be interested in doing, drop a comment on the YouTube page here. Hopefully, we can be working together really soon!
