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Home » Resources » Blog » Triple Your Income in the Next 12 Months

Triple Your Income in the Next 12 Months

Oh sure, you’ve decided to either increase your income on a part-time basis or you’ve quit your job and taken the full-time plunge. So what! All that means is you’ve decided to take control of your own financial future and make things happen. I’m proud of you if you have made that choice.

But wait! Before you pat yourself on the back and your head swells up like a basketball, answer this question:
Are you running your business with blinders on?

I mean are you so narrowly focused on one little piece of the business that you’re letting the real money fly right on by? Most people get started in real estate and learn one or two ways to make money. Then they spend ten or twenty years doing the same stupid things over and over.

Oh sure, most make good money and others do exceptionally well. But what saddens me the most is, in all my years of training in this business, I’ve only seen a handful of sharp entrepreneurs really grasp the big picture. Most are so content making a good living that they miss the most profitable part of the business.

Let’s look at the big picture and what you can do to triple your income in the next twelve months.

Four ways to profit

There are four basic ways to profit as an investor. The way to make the most money the fastest is to use all four. Don’t get so narrowly focused on one that you miss out on the real money.

The BIG four:
1. Wholesaling
2. Retailing
3. Lease Options
4. Creating No-Qualifying Financing

Of course, these ways have several offspring and variations, but these are the big four (assuming you’re not holding for the long term). Even if you are, your exit strategy will fall into one of the big four unless you exchange or die.

Wholesaling

Wholesaling is finding bargains and quickly passing them on to bargain hunters. The house usually needs to be rehabbed and the buyer is willing to do the rehab. The buyer then retails to the consumer or lives in it.

The plan is to find the bargain, tie it up with a purchase contract, then quickly sell. The profit comes from doing a simultaneous closing with the buyer who brings to the closing a few thousand dollars more than you agreed to pay the seller. Many of my students make over $20,000 per month doing nothing but wholesaling.

Retailing

Retailing is getting these same houses fixed up and sold to owner/occupants through new financing. Most beginners look at investing through this window. Conventional wisdom says the way to make money is to either buy, fix, and resell or to keep and rent.

If you’ve ever heard me speak, you know how I feel about conventional wisdom. It’s almost always wrong. However, in this case I agree, there is real money in retailing and renting.

But you see, here is something you’ll never learn from conventional wisdom that can only come from a battle-scarred warrior who’s learned the hard way. This one lesson alone could make the difference between success and failure.

Do not do any repairs or become a long-term landlord your first year in business.

How does that stack up to conventional wisdom? You’ve been told by all your real estate courses and investor buddies that the best thing to do is rush out and buy a rental property or a fixer-upper. You know what? Even though that’s the last thing I want you to do, I’d still prefer it to doing nothing.

However, before you do, let me briefly make my case and see if you agree with me. First, let’s look at why you want to do either. Your reason for buying and selling a fixer-upper is to make some cash within the next few months. If that’s your objective, why on earth would you want to begin with the hardest way?

And believe me, it is. Retailing is a lot of work and takes time. A lot can go wrong, especially for a beginner. You have to buy the house, raise the money, hire a contractor, and then the hard part–find a qualified buyer. If you attempt this without the proper training, I assure you you’ll get those battle scars I mentioned earlier.
What’s my problem with rental property in the first year? The answer is simple: you’re not ready yet. The only real reason to own rental property is to build wealth. The real money is in the equity. But what’s your rush?

The first lesson I learned in my early days was:

Take care of today’s cash flow needs before worrying about getting rich.

Let’s get the bills paid and get out of debt before we start building an empire. “I’ll create a cash flow I can live on in my early days as a landlord.” If you think this is the case, take a current landlord to lunch and ask him/her where all the money goes from rentals. You won’t like the answer.

I suggest you wait. Learn the ropes before you take an ugly seminar. Give yourself a year to learn the which components make a good “keeper.” Find out how and where to buy properly. Get a feel for the business. If you don’t, your education will come from all those investors who bought incorrectly and are trying to sell you their stupid mistakes.

You’ll learn the ropes all right. Unfortunately, one might be tightening around your neck. This lesson holds true whether you retail a house or rent it. Both are good reasons for getting in the business, but neither is a good place to start.

Back to the big picture. I would like to see you in the business, not just the junker or rental side. You must expand your horizons; take off the blinders. There’s more to life than cheap, ugly houses.

Lease options

Lease options deal with pretty houses in lovely neighborhoods in all price ranges. They have nothing to do with contractors, raising money, and taking big risks. They’re fast, relatively easy, and produce just as much money, or more, as retailing houses. Most investors let these go by because junkers are all they can see.

No-qualifying financing

Another solution is creating no-qualifying financing. Between these two you can literally do many times the deals you’re currently doing and probably not need to generate any more leads.

Most of your income should come from pretty houses

The big money is in the art of creating Multiple Offer Strategies, not fixing houses. That’s why you’re shooting yourself in the foot every time you let a potential pretty house deal go by because you never learned how to capitalize on it.

Your job is to take information you get from the seller and create as many solutions as possible to solve his/her problems and create a profit center for you.

When you do this, you’ll be in the top 1/2% of those who qualify as “transaction engineers.” In the process you’ll eliminate your competition. In fact, you could easily make $250,000 per year from their leftovers.

So, get out of the box and see yourself as an entrepreneur who truly understands the business, not just a rehabber or a landlord. I don’t care how hard you work at the wholesale and retail business, you can never reach your full potential. You must expand your horizons to learn and practice the pretty side–the profitable side.

You won’t get rich with junkers

No matter how good you get with junkers, you’ll never make more than 30% of your potential. There are three reasons.

The junker business revolves around low-price properties, while the pretty house business has no upper price cap. In fact, I prefer the higher prices. It just stands to reason when you deal in bigger dollars, more of them will be left over for you.

When you get paid from wholesaling or retailing, you get one check and you’re out. Not true for lease options and no-qualifying financing deals. They create multiple streams of income that keep coming in, whether you’re still out there working or not. You do the job once and get paid over and over.

There are more pretty houses than ugly ones.

Obviously, the part of the market that provides the biggest supply of houses warrants the most attention. When you learn to capitalize on the big supply, not just the uglies, your income will skyrocket.

Yes, I know it sounds like I have something against the junker business. But that’s not true. I love to make something pretty from something ugly. I began and prospered in junkers and still work them to this day. But I grew up…

Taking off the blinders

Several years ago I discovered the rest of the story and took off my blinders. I’m only suggesting you do the same. It’s just a marginal shift from what you may be doing now.

If all you want is a good income and you’re happy in your comfort zone, then please don’t let me disturb you. I’ll allow you to settle with whatever failure rate you want. It’s your life, your family, and the income you’re willing to accept. At least you have the freedom of running your own business and you’re the boss, right?
What the heck, you’re making more than you did in your old job. When you get out of bed in the morning you’re already at the office. No traffic hassles, no time clocks and no lay-offs. Look, you can convince yourself you’re doing great. Maybe even your family and friends are fooled, but not this old war horse.
I have too many students making too much money to accept anything less. If you’re not growing, you’re dying. Is it time to get to the next level and start treating this as the extremely profitable business it is? If you’ve been dealing in junkers for a while, the answer is yes. Become a transaction engineer now. It will take a while to learn the business, but it’s worth it.

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9 Responses to Triple Your Income in the Next 12 Months

  1. Derrold Burnett says:

    I have not done a rehab but it is easy to see how people get swept into the flurry of fix n flip because TV gets er done in an hour. It doesn’t take much study of finance to understand the more times you flip a dollar, the more you make. The less time it takes to flip a dollar means the opportunity to make more. That is where lease options, options and ACTS come into play–little to no money tied up in these deals and especially a lot less time–time that can be used finding another one of these deals. I appreciate the wisdom you share with us. Thank you. Derrold Burnett

  2. Gary Proctor says:

    Great advice as always. Many of the deals that investors pass on could easily make me thousands. We all just need to keep our mind & eyes open for opportunities.

  3. Karri Lewis says:

    Thanks, for the great advice for the first year of business and what NOT to focus on!

  4. Samuel Sdigui says:

    Really good advice that I am going to Implement

  5. Brian Chilcote says:

    This is good sound advice, do not get stuck on a small section of investing. Always learn new things to grow your business and your knowledge.

  6. Tim Usher says:

    Awesome, solid information chocked full of money making ideas, Thanks!

  7. Thabata Dorce says:

    Thanks for that advice.

  8. Rose McLaughlin says:

    Thank You Ron again for all your insight, your experience speaks volumes!

  9. David Ball says:

    Excellent post. I am glad I’m reading this as a new student. I too thought that real estate was rehabbing and flipping. Like what you see on TV. It’s empowering to know that there’s another side to this business. And what could be better than working less to earn more!

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