How Your Realtor Can Set You Up For PASSIVE Income

Who you partner with when you buy or sell your home can not only make a difference in that individual transaction, but the right real estate agent can be a connection that has a drastic influence on the trajectory of your life. I am sure you have heard this before, but real estate professionals are not a one-size-fits-all. Their services, their processes, and their expertise can greatly vary. That is why partnering with one that is in alignment with your long-term goals and has knowledge of the market and opportunities out there for you is crucial. 

Here at the Moore Maguire Real Estate Team, we believe in building life-long relationships and helping clients see real estate as a tool that can help them take back control of their lives and their day-to-day lives. Our agents are not only experts in the local Philadelphia suburbs but they are personally experienced and well-versed in leveraging real estate to create true freedom. There is a reason people say that buying a home is one of the largest investments people make, even when the property is bought with the intention of personal use. People often think of the immediate gratification buying a home offers, having a space to live (and hopefully love). The next step in this, that many people miss, is the opportunity to leverage that very home to help you get into your next one. And, I am not talking about just selling, because depending on the market that may not always be the most bang for your buck. 

Homeowners are able to leverage programs like HELOCS and 1031 Exchanges to get a hold of the money that is needed to finance their next purchase WITHOUT having to miss out on the opportunity to add an additional stream of income through renting out their current one. The cherry on top of it all is that by building an investment portfolio in this “Move-Up” Method style keeps MORE MONEY IN YOUR POCKETS. Most people say they would love more passive money coming in, but shy away because they believe that the initial cost of entry is going to be too high. But by using this kind of method, you are only using the money you would have spent anyways to upgrade your space, and essentially getting an investment property for cheaper. What do I mean by that? Well, when buying a property for the sole purpose of using it as an investment property you will have to put at least 20% down, whereas if you are buying it with the intention of living in it for at least a year you can get that property for as little as 3% down. 

You will want to be mindful of what your net profits will be. You should do a market analysis to see what your property can rent for in your current local market. You will want to do the math and subtract expenses, such as your mortgage payment and any cost of maintenance/management, to see what additional income you will be getting each month. That’s why having an expert who can run these numbers and explain your options to you is the key to your success in this method. 

Our agents not only have experience helping clients with their investment portfolios but have also personally leveraged real estate in this way. Our local Realtor, Kellen Rooker, is a shining example of this. She has used intentional buying and the move-up method to purchase 3 homes in the last three years, with her first two properties being cash-flowing properties immediately upon renting. Kickstarting her investment portfolio, adding another stream of monthly income, and each time elevating her personal living circumstances to accommodate her life milestones.