Buy a Turnkey Rental Instead of a First Home: Here’s Why
Are you saving up money for a down payment on your first home? If you already have $17,000 or $20,000 saved up and sitting in an account, what’s the best way to make that money work for you? Buying a home actually isn’t the smartest decision, especially at this stage in life. Whether you’re still saving or you have enough money to put a down payment on something, you should buy a turnkey rental instead of a first home. Here’s why.
You’ll Be Saddled With Your Home
Homes come with a never-ending list of things that need to be done and things that need to be paid for. Make no mistake – a home takes money and work to maintain. Whenever anything goes wrong, it’s on your shoulders to fix it, whereas if you’re renting a place for yourself, you just call up the leasing agent and they send someone out.
A Turnkey Rental Gives You Freedom
On the other hand, a turnkey rental gives you more time and fewer responsibilities to do what you want. When you buy a turnkey rental with a tenant and a property manager in place, your only job is it deposit checks into your bank account. Actually, strike that. That’s the property manager’s job. All you have to do is receive the money. Turnkey rentals essentially take care of themselves, with the help of the property manager of course. And, with the added cash flow from just one turnkey rental, you can maybe even take an extra day off work once a week, or save up to buy another turnkey rental for even more freedom.
Home Ownership Isn’t the American Dream
You may have been sold on the idea that home ownership is the American Dream, but that’s a fallacy that the banks tell you in order to sell you a mortgage product. The American Dream is more like life, liberty and the pursuit of happiness. It’s not a huge house that ties you down to one spot for the rest of your life, forcing you to work 80 hours a week just to pay the mortgage and put food on the table. Home ownership can shorten your life through stress, take away your liberty to create future wealth and make you miserable and worried that you will lose it all in foreclosure. That sounds more like a nightmare than a dream.
Turnkey Rentals Offer a Chance at Financial Freedom
Financial freedom is something that everyone can strive for. Buying a turnkey rental is a step on the path toward financial freedom. Cash flowing turnkey rentals put money in your pocket every month. Yes, there will be months when you need to pay for something that needs replacing or fixing, but the bottom line will be positive cash flow. That’s extra income that will help you to ultimately achieve financial freedom. One turnkey rental may ‘only’ yield $200 in positive cash flow a month. But when you build upon that, you could have four or five turnkey rentals in your portfolio. Then you’d have $800 or $1000 in extra income every month. That’s income that doesn’t require your time, once you make your original purchase. That’s true financial freedom.
Home Ownership Isn’t That Great For the Economy
When people buy a home, they tend to live there for a long time. It’s only when they sell and buy a new home that the economy is stimulated. In fact, the economy in general only thrives when things are bought and sold; not when people hold, like they do with primary residence homes.
Turnkey Rentals Make Economic Sense
From a purely economical standpoint, turnkey rentals make better sense.
If everyone rents their house, and everyone owns turnkey rentals, then everyone gets a share of the housing market. The renters are also the landlords for rental properties. Renters tend to move more than homeowners, since they can move to where the jobs are, or where their new school is located.
There’s obviously a lot to be said for homeownership. Buying your own home lets you put down roots, become part of a community and customize your home and surrounding property the way you want to live. After a time, you’ll eventually likely want to buy your own home. But if you’re in the early stages in your life, and you have only your job and a little bit of savings, buying a turnkey rental is a better choice than buying a first home.
With a turnkey rental, you have the chance to build a better future for yourself that includes financial freedom. If you buy a house, it could be decades or never before you ever have the money again to invest in turnkey rentals.