“The Book on Rental Property Investing” by Brandon Turner is an exhaustive A-to-Z how-to guide, explaining in-depth almost every step and stage of the process of becoming a real estate investor. Written from the perspective of an insider, the book provides a great overview of the real estate market and includes numerous ideas, strategies, and concepts for achieving financial freedom through rental properties.
Who is it for?
Best suited for anyone who wants to start out in rental investing, but probably useful for experienced real estate investors as well.
In “The Book on Rental Property Investing” you’ll learn:
- Why rental property investing beats all other types of income.
- How and why real estate generates wealth.
- Four strategies to earn money as a real estate investor.
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The Book on Rental Property Investing by Brandon Turner | Audio Book Summary
Brandon Turner’s Biography
Brandon Turner is an entrepreneur, podcaster, and a longtime real estate investor, located in grays Harbor County, Washington. He specializes in rental property investing and owns more than 700 rental units and dozens of rehabs. He is the vice president of BiggerPockets and co-host of the BiggerPockets Podcast. He has authored four books, including “The Book on Rental Property Investing.”
The Book on Rental Property Investing Book Review
Real estate is the best investment because it is safe, fast, and easy to understand. You can start investing today and see results within weeks. If you invest in real estate, you will never need to worry about losing your money again.
Here are five reasons why you should consider renting out your property.
Rental properties are a great investment because you get to enjoy your money while it grows. You also get to avoid paying taxes on your profits. And if you’re smart about it, you can even turn your rental property into an ATM machine.
- Leverage is when you borrow money to invest in something. Leverage allows you to buy a larger amount of an asset at a lower cost than if you had bought the same amount of the asset yourself. For example, if you were to buy $100,000 worth of shares in a company, you would pay about $10,000. If you borrowed $100,000 from a bank, you could buy the same number of shares for just $9,000. So, you would save $1,000.
- You can’t leverage time and abilities to make stocks go up. No matter how much you might like to. But you can leverage them both in real estate. In other words, you can actually manage your investment. That’s what you can’t really do in other investments. So, in real estate, you can actually manage it. That means that you get to hustle for your future. Something you can’t necessarily do in other investment areas
- Rental property investing guarantees you perpetual demand. No matter how good the times might be, there will always be people who need somewhere to live. Furthermore, since modern culture increasingly appreciates mobility, the demand for rentals grows by the minute.
- Time Proof Strategy. Time proof is an investment strategy that allows investors to profit from the long term growth of real estate. Since the dawn of human civilization, people have always invested in real estate. Why not you?
- Stability is the key to success in real estate investing. There are always ups and downs, but the overall trend is upward. Real estate is simple because you don’t need to understand anything about the property itself. All you need to know is what the rent is, and that’s all you need to know. You don’t need a degree in finance or accounting to invest in real estate. You just need to be willing to put your money at risk.
The Book on Rental Property Investing Book Summary
Rental property investing is one of the best ways to generate wealth.
Rental properties offer investors the chance to capitalize on all four profit sources. Appreciation, cash flow, tax deductions, and loan pay down are just some of the ways that rental properties can provide returns.
- Appreciation is a powerful tool. If you buy a house for $100,000, and then spend $10,000 on renovations, your house will appreciate in value. That means that after a few years, you could sell it for $110,000. You could also rent out the house and get a higher return. Appreciation is not always a good thing though. If you buy a $100,000 house and then spend $20,000 on renovations, you won’t see any appreciation at all. You’ll end up paying more money for the same house.
- In the real estate rental business cash flow is “income left after paying out expenses”. Steady cash flow is “lifeblood of any rental property owner”. In other words, even if you appreciate your investment, don’t invest in anything that isn’t ready to generate revenue as soon as possible because you will never get back what you put in. Don’t buy properties just for a “what if” scenario, buy them for a “this is” reality.
- Real estate investors save money on taxes. Governments around the world love them because they provide stable housing for citizens. Real estate investors pay less in tax than the average citizen, because they earn more income than the average citizen.
- Loan payoff. Unlike most other investments properties can earn you money while you don’t actually own them. For example you can sublet a house as a tenant, or rent your house to other people while you’re paying the bank. Most important you can build wealth by getting a loan on your rental house and using the rental income to pay that loan down every month. Do the math correctly and you will have your renters paying your property mortgage and helping you retire a millionaire while barely working!
The five keys to renting out a property successfully are:
According to Turner, the following 5 keys are essential and nonnegotiable for finding long-lasting success when buying rental properties.
- Think the wrong thoughts. Begin with your mind. Instead of thinking ‘I want to do this,’ or ‘I can do this, think in terms of ‘I won’t do this’ and ‘I am not doing this.’ But don’t just think: write down your goals and make a habit of saying them out loud to yourself every day to get them etched into your subconscious. Also don’t forget about turning your problems into challenges: When ‘I can’t,’ become ‘How can I?’ your brain is stimulated to solve your problems.
- Nowadays, there are so much information out there that it’s hard to know what to focus on. You need to be focused from the beginning. Make a list of resources, read them and then get started. Don’t spend money on expensive coaching or training programs. There are so many free courses available that it’s smarter just to use your money for your investments.
- Pick the best plan. Turner is not referring to a business plan here. He means a “vision plan“, a document that outlines your “Why’s”, objectives, potential milestones and ultimate destination. Your plan doesn’t need to be comprehensive – just answer the following three questions:1) What kind of investment properties will you buy?2) How often will you purchase them?3) How will you finance those purchases?
- Acquire assets that will increase your net worth. If you want to become rich, then you need to acquire assets that will increase your wealth. You should not buy anything that will decrease your net worth. A good real estate agent can help you identify the best assets.
- Manage your rentals like a pro. You need to constantly monitor your properties to ensure they are running smoothly. You also need to keep an eye out for any potential problems before they become big issues. For example, if you notice that your tenants aren’t paying rent, you might want to check whether there’s something wrong with the property. Or, if you see that your tenant isn’t keeping up with repairs, you might want to consider getting them to pay for the repairs themselves.
Here are four sample real estate strategies.
There are several ways to earn money in real-estate. These four should help you find a path that works for you and assists you in building your own personal road map to rental-property success.
- Rental Properties. This is the simplest investment strategy and the one most people think of when they think about real estate investing. In essence, this is a three step process: 1) Buy incredible rental properties below market price, 2) Save the cash flow, and then 3) Invest that cash flow into more rental properties. Rather than guaranteed returns, this is an “if-then” plan that depends on a steady 3% yearly appreciation rate and your ability to find discount multifamily properties, whose values can be improved by 10%, in a single year through “forced appreciation”. Using these standards, you can expect to earn, every two year, enough money to buy another fourplex and, by year 7, you will have generated about $60,000 per year in passive income, which equals the average American household income!
- Single family homes are great investments. You can make a lot of money if you invest wisely. If you save 20% of your income each year, you can get a house worth $80,000 in just 7 years. That means you could make $3,600 per month in rental income. Combine that with your savings, and you could have $60,000 to put down on a 3 bedroom 2 bath house. Renting out houses is easy, and you can make a lot of extra money doing it.
- House hacking is a strategy by where you rent out your primary residence. You will need a multifamily property in order to do this. Only after that, you can live in any of the units of your house while renting out the others to earn enough money to pay your mortgage, plus buy the property for free.
- BRRRR is a strategy that involves buying, rehabbing, renting, refinancing, and repeating. It’s a powerful strategy because it allows you to acquire multiple properties without running out of capital. You can also use it to invest in real estate, even if you don’t have any experience.
My goal with this The Book on Rental Property Investing book summary is to create the single greatest rental property investing summary ever written.
We haven’t read any other books like this one yet, but we think that “The Book of Rental Properties” will be a great resource for those who want to invest in rental properties. It dives deep into the nitty gritty details of real estate investing, and can serve as a well-organized reference point for anyone who is interested in getting started. If that sounds like you, then this book is definitely worth reading!
Renting out your property is a great way to earn passive income. You can rent out your property to tenants, or you can sell it to them. Either way, you’ll always receive rental income, and you won’t need to spend any time managing the property.
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