What is the best strategy for beginners when it comes to the game of real estate?
My name is Kris Krohn and today, I'm going to be talking about the big 3
which means we're going to be tackling 3 of the biggest most popular
strategies that there are in real estate and really get down to the gritty nitty
gritties of which one is going to be best for you. Is it going to be
multi-family real estate? Is it going to be single-family rentals or is it going
to be flipping property?
So, let's go check out my trusty whiteboard here. And what I want to do is
this basic comparison. Flips, multifamily, rentals. And as we talk about them, let me
make sure you first have some context on what all those are. First of all, for
those either new to the game real estate, flipping is this game of I'm going to buy a
property really low and I'm going to sell it really high. And it's really short.
Right? I'm going to do this for like like one month, 2 or 3 months. And I'm
going to see if I can make 10,000 or 20,000 or 50,000 dollars on a single deal. Then
you have multi-family. Multi-family is like think high-rises. Think many
families in one building, right? It could be a multi-family, it could be like a 12
unit, it could be a 20 unit. It could be a hundred and fifty unit. And the idea is
I'm going to do 1 property and it's going to have several different many apartments
that I can run out for money. And then lastly, you've got single-family rentals,
right? It's just reducing it down to, "I'm buying a home that I'm going to be
renting out. And I like that one because I'm going to be renting out. I can buy
something really small. it's not as big and scary."
There's no flipping this is and that. That's what we really get into the pro and con
of this. So now that you understand a little bit more about what these are,
let's talk about the differences. So, flips. If I'm going to buy a property, I'm
going to flip a property, one of the things that you need to understand is that one
of the big pros is that you have really big upfront money. I mean, if you
successfully do one of these deals, someone in my private real estate
community just completed a flip and he made $70,000. False, he made sixty nine
thousand eight hundred and something dollars, right? He made seventy thousand
dollars. And he did all that and I think like a 6 week time frame. The pro is
you got really big money but if you're new to the game, there's also a certain
level of risk that you need to be aware of. Because what if something goes wrong?
What if you intended to make a 20 thousand dollar, because 20 grand sounds
great. Riding a flip those deal, I'm going to make $20,000. But what if
something goes wrong and the foundation has a bigger problem or I miscalculated
and I can't sell it for as much as I thought. And all of a sudden to get it
off your hands. You're now, 10 thousand underwater. That happens to new investors.
So you can make really big money but you need to understand that there is some
risk and game. Let's talk multifamily, okay? Here's
the cool thing about multifamily. This money that you get here on a flip, this
is what I call upfront money. But here are multi-family, what you're going to get
is a really big cash flow. You're going to get a superior cash flow. And what I mean
by cash flow is it costs 10 thousand dollars a month to maintain my building.
But I collect 15 thousand dollars a month. Which means there's 5 thousand
in the gap. And that 5 thousand comes to me when it's all done and said. So
that can be a really big cash flow. But one of the negatives, especially if
you're brand new is that if you want to buy a really big building, guess what it
takes? Takes a lot of money. These are multi multi-million dollar deals. And you
might need $500,000 out of pocket. You might need a million
dollars. So if you're brand new, one of the cons is that it takes a lot of money.
Now, you might be watching this saying, "I got a lot of money." But if you're like
most people are like when I got started with nothing. That's like, "Dude, I don't
have 2 pennies to rub together." So that's not going to work for me. And then
lastly, we have rentals. Now, the game here on rentals is that rentals have the
ability if you hold single family homes long enough, they can really go up in
value. And what it can produce is what I call a long-term gain. Which means, "Hey, on
this property, I might not get a whole lot of cash flow compared to a
multi-family like a big apartment complex." But you know what? When I go to
sell that house, if I do it right, maybe I'll make 50 grand when it's time to
sell it. Maybe I'll make $100,000 when it's time to sell it. And that can be
exciting for some people. But you know what? One of the cons on rentals is that
if you buy a home at market value and you rent it out, it often has a very
small cash flow compared to multifamily. Look at these 3 strategies for just
a moment. Flipping offers you the big upfront money. Multifamily gives you that
every month big residual income money. And rentals gives you the long-term
gains. If you were to ask me, "Kris, of these 3 strategies, which one should
I put my time and effort in? If I'm brand-new, if I'm a beginner and I really
want to crush it in real estate, which is it Kris? Is it flips? Is it multifamily?
Is it rentals? None of them. They're all popular. They're
all good. You can make money with all of them. But I do a little bit of a
different strategy. Because I'm a little greedy. Meaning I want it all. I want to
have the upfront money, I want the cash flow. And I also want the long-term gains.
And by the way, is there a way to do that while eliminating my risk or at least
severely reducing it? Is there a way to do it that doesn't even necessarily even
require money as opposed to a lot of money? And is there a way to get an
awesome cash flow instead of a small cash flow? There is a perfect solution.
When I first got starting the game of real estate, I mathematically was
evaluating not just these 3 but the top 30 strategies. And I was asking
myself, which of all of these strategies is going to be best? And I would ask my
mentors and people that were really successful in real estate. None of them
could give me a clean answer. You see, every single one of them they would say
basically, "Well, this one's has merit for this reason and this one..." Like for
example, flips. This one's good because as good up for a money. I like rentals
because as long-term gains. And it's like wait a second, that's not a good answer.
There's got to be a best. I ended up writing a book about a special
mathematical equation that I wrote. An algorithm. I dumped in the top 30
strategies and one emerged. And what I'm going to do right now is I'm going to share
with you what I would do if I were you if you're a beginner. On how you can get
the upfront money of flips, you can get a really awesome cash flow and you can get
long-term gains. I call it compassionate financing. It's a lease option with the
twist. And here's what it basically means. What I'm doing instead with my special
lease option system. I am buying single-family homes
underneath the median that do offer me the long-term gains of a rental. But I'm
not just buying the home and renting it out. I'm using a special contract and I'm
basically saying, "I don't want a renter. I want a future homeowner." Did you get that?
I want someone that wants to make this their home. They want to maintain it. They
want to manage it. They want to take care of it and they want to buy it. TVhat
person is going to give you double the cash flow. So now, we picked up double the cash
flow than we would have gotten here while still keeping the long-term gains.
And finally, these individuals got to give you not just a refundable deposit
or first month's rent. They got to give you a bigger commitment than that. It's
almost like what you'd call it down payment when buying a house. Because
their intention is to make this home their own. So they're going to give you an
average $5,000 up front as a down payment. You get that upfront kicker. So
here's what it really means. It means that with my system that I that... By the
way, you can click the link below and I'll tell you all about it. And if it's
useful for you, get started with it. I actually mentor people. I have a private
community where I help people do this because when you're brand-new, you need
help. Right now, I'm buying hundreds of homes personally every single year. I've
got my wealth figured out. I was financially free at the age of 26. But I
take a little bit of my time and I basically help those that really want to
learn how to do this. I want $5,000 up front when I actually do this deal.
Because on average, that's what I collect. Cash flow, I don't want like a 1 or 2
hundred dollar a month risky cash flow. I want on average, it's
$500 a month. I mean just imagine for a moment having 500 extra dollars
every single month. And then this last 1. The long-term gains? When I go to
sell this house, I'm making tens of thousands of dollars at that point. So
5 grand upfront, 500 a month, tens of thousands of dollars. And here's
the best part. This strategy, it doesn't have the risk
of flips. It doesn't require a lot of money. In fact, I can show you how to do
it with very little or no money at all. Which is perfect for people like you and
I, if we're starting with nothing. And it has an amazing cash flow. So, we're
eliminating the cons, we're picking up all the benefits. And if I were a
beginner and if I were you, that's what I would do. Like I said. The information is
in the description. And the link below is what I want you to understand. I got
really insecure about society's game plan for me. Society basically said, "Kris,
go to college work for somebody else." And I started going down that path and then
it didn't work out. And I got discouraged because I was like, "Man, society's not
really going to help me. My parents told me that if I got a college degree that I'd
be set for life and that a company would help take care of me." That is not what my
experience was. It all hit me like a ton of bricks when I came home and I was
newly married and I found my wife in tears because
we couldn't pay the bills. For me, as a husband trying to be a good provider, it
was a really sucky moment. I could have said, "Well, I'm in college and I even
though I have this full-time telemarketing job which sucks. I'm doing
my best." But my best wasn't enough it. Wasn't it... Wasn't putting food on the
table literally. That's why she was crying. That's when I decided that I
needed to have a game plan for my life. And what I'm really sharing with you
right now is the game plan that I used on my first 25 properties in a 4-year
period of time that bought me back my independence. My emancipation. I created a
6-figure residual income and I quit my job just the same year I graduated from
college. And my life has never been the same since. So, I want to you understand that
I'm not just sharing with you logical ideas for your consideration. I'm
really sharing with you my life. I'm sharing with you what I did that created
my financial independence. Made a huge difference for me. And now, I've created
all this wealth and have made millions of dollars. And the way that I give back
these days is by finding serious action takers. People that are committed, people
that know they need a mentor. People that know they need help getting outside the
system. And that's what I do. Might be for you, it might not. If you like in the
video, I want to invite you to subscribe and watch more of these videos and let
it be useful for you. But for those of you that are saying, "Oh my gosh Kris, I
can identify with that, right?" I mean... Especially in today's world.
Dude, we have been cheated. Society's been telling us what to do and it's not
working. College is not producing what we wanted
to. And you fast forward 40 years and people aren't getting what they want. You
got to take financial control of your own life. You got to take bull by the
horns and you got to make that happen. But that doesn't mean you have to go it
alone. I had mentors helping me out. You know, I take some of my time and I help
other people out. And if you feel like that really resonates with you, I want to
invite you to click the link in the description below. And let me share with
you more about the details of exactly how this works. Talk to a member of my
team. Get the details and let me mentor you and show you how you can
in your life. Thanks for watching the video guys.
Make sure you are a subscriber. Click that link below and I look forward to seeing you on the
next video.