We have a question for you: What happens after you stop selling houses?
If you are interested in having a career in real estate, chances are that you’re interested in building wealth too. We believe at KW that you shouldn’t just be an agent, but also an investor. Why? Because while you may become rich by having a large income, the way to become wealthy is by owning income-producing assets like real estate.
We are amazed by many of our top agents in Keller Williams that are using their income from real estate sales to buy investment properties.
This is an opportunity for all and today we want to dive deeper into how you can not just build a great business at KW but also invest in real estate to create wealth.
So, let’s get started…
There are only 3 ways to build wealth:
Invest in Stocks
Invest in Real Estate
A career in real estate offers you the opportunity to create a business worth owning while also putting you in the captain's seat for investing in real estate.
Let’s say your plan is to slowly accumulate a mountain of rental homes during your career as a real estate agent (a great plan by the way!) Many people think the only way you make money in rental properties is through rent each month. That’s not the case.
There are actually FOUR ways you can build wealth through real estate:
The first is of course rental income that you have coming in every month.
The second is what’s known as debt paydown. Every month you are making mortgage payments on the property. This means the debt is decreasing and your equity in the home is going up. This is what people refer to as a “forced savings account.” This is a great thing because, even though you are making payments to the bank, you are reducing your loan. So it’s kind of like making payments to yourself.
The third way you make money by owning a rental property is through appreciation. Every year your house will most likely be increasing in value. The great thing is that this works in conjunction with your debt paydown. While your loan is going down, the home value is going up meaning your equity is increasing 2X faster!
The fourth way you make money in a home is through the tax advantages you receive. Rental properties provide great tax write-offs so you can actually KEEP more of what you make. You should have a great CPA that can consult you on both being a 1099 independent contractor and on real estate investing tax advantages.
Those are 4 ways you can make money through just ONE investment type. We haven’t even talked about doing flips, seller financing, or commercial…
As you can see, there are great advantages to selling real estate and buying real estate over the course of your real estate career. And for the sake of not turning this blog post into a book, we just went over one of the possible real estate investment strategies. But if you want to dive into this even more, or learn some other ways to invest in real estate, just know that at KW we have the resources to teach you about all of them.
So what does this have to do with becoming a real estate agent?
Remember, the key is to invest in what you know, and who knows real estate better than a real estate agent?
As an agent, you can have a first look at great deals. You will have better knowledge of the market than anyone else.
At Keller Williams, we not only teach you how to have a great income, but how to build wealth.
If you spend just part of your time building wealth during the years of building your real estate business, you may be amazed at the life you build for yourself and your family even after you receive your last commission check.