1) How do you find an apartment building that will throw off enough positive cashflow to provide you with a comfortable living?
2) Once you’ve found that property, how do you buy it using none of your own money?
Point 1) begs the question; what exactly is a comfortable living. The definition of a comfortable living is going to differ for just about everyone, but to get a general idea let’s look at some personal income statistics from Wikipedia.
If you look at these statistics you can see the income of people varies widely depending on, a) whether they are male or female, and b) how much education they have. Based on people who are over 25, high school graduates earn $26,000 a year, some college $31,000 a year, And the way the trend goes, the more education people have the higher their income is.
If you are a high school graduate your income is likely to be $26,506, or thereabouts. If you have a Bachelors degree your income is probably $49,300 or more. I don’t know what your situation is or where you fall in this range, but let’s say it’s somewhere between $26,000 and $49,000. So if your income is between $26,000 and $49,000 a year that means it’s on average about $35,000 per year.
So if you are going to create a “comfortable living” buying an apartment building, the first thing the property must accomplish for you is replace your current income. So let’s define “comfortable living” as replacing your current income, and then adding another 20% on top of that to provide the comfort factor. To keep with round numbers and something that is easily divisible by twelve, let’s say that comfortable living number is $48,000 a year, which is $4,000 per month.
Now, how do you find an apartment building, or buildings, that will produce $4,000 per month or more? Well, there are many, many ways to do that, as in all of real estate there are many different ways to get to that objective. But let’s stay within the realm of apartment buildings, and the easiest way, which is to buy turnarounds.