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The Secret to Financing Multiple Properties; Proven Strategies

Sep 16, 2008
Melbourne, Australia is a booming place for many businesses, not the least of which is real estate investing. No matter what branch of real estate you are in or want to get in, you should have the information that will bring you large profits? Profits that you will realise by financing multiple properties.

You can use these principles regardless of the number of properties you currently own. With as few as two houses, or as many as thirty, you can make a fortune as the country's real estate values continue to rise.

The top ways of affordably investing in multiple properties is to: a) buy fixer-upper properties that you can get cheaply, then turn into huge ROIs; and b) use the proceeds from one sale to finance your next purchase(s). With a little creativity, you can leverage the equity you have in your current real estate holdings to greatly expand your assets.

For the sake of argument, let us agree that you have five properties valued at $100,000 each. We will go one-step further and say they are all paid for. You could sell all or a few of them to free up capital to buy multiple properties but then you have the waiting game to play and in the mean time that great deal down the street just got away. Better to keep them and begin formulating your plans to buy a good flipper.

The better plan is to find the undervalued homes on the market. You may know these better as potential flips. Your current property may even be a flip that you have not turned yet. Of course if you have operated strictly as a landlord then this idea may be foreign to you.

For the sake, still, of simplicity, we'll assume that you have in fact entered into the real estate business in order to flip properties for income (sure beats flipping burgers). Don't flip your five yet. Go forth and find yourself, say, three fixer-upper properties. Once you have them in your sights and you have the deal you want with them (you'll probably not get your deals all at once) begin taking out home equity lines of credit from your already owned properties.

This money will allow you to purchase the property and then proceed with improvements. Be sure you have all your figures in hand before the deal is at this point of no return. Price of materials and contractors have destroyed more than one good potential flip. Check on the reliability of the contractor if you use one and be realistic about the properties potential selling price.

One caution here, though. You will need to be careful when making the deals. Do your homework on the properties to flip and research the people you are dealing with. You do not want to have your home equity sunk into a white elephant. Once the dust settles, you should have several great homes that you can either reap residual income from or sell one or more outright and receive a lump sum for the bank while paying off all the debt you incurred on the flips. An independent financial advisor can be a priceless assistant.
About the Author
Author: James L. Hardcastle is an expert at Loans Australia and they know everything about property investing and will give you advice with creative finance at Loans Australia.
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