BiggerPockets Real Estate Podcast
Business:Investing
Could building houses make you more money than buying existing ones? When should someone use the 1% rule in real estate, and when does this metric point to a cash flow disaster? What’s the best way to get more capital or funding for future real estate deals: get a HELOC on your primary residence or look for investor-only DSCR loans? We’re pulling some of the top questions from the BiggerPockets Forums and giving our answers on today’s show!
Expert investors Dave Meyer, James Dainard, and Kathy Fettke from the BiggerPockets On the Market podcast are on today to answer YOUR real estate investing questions. First, we return to the age-old debate, “Does the 1% rule exist anymore?” With high home prices and lagging rent growth, this once foolproof metric could be an outdated calculation inexperienced real estate investors should avoid. Next, can you make more money building houses than flipping houses?
Are turnkey rentals the best “low headache” real estate investment? We’ll answer that and give our thoughts on when to use a HELOC (home equity line of credit) vs. a DSCR loan (debt service coverage ratio). Finally, for our out-of-state investors, we share the top metrics to look at BEFORE you invest in a new market.
Want to ask a real estate investing question? Post yours in the BiggerPockets Forums, and we might select it for our next show!
In This Episode We Cover
The 1% rule explained and when you should (and definitely shouldn’t) use it to decide on deals
Building new construction vs. flipping houses, plus which could make you more in 2024
Turnkey real estate investing and whether the lost value-add potential is worth the passive income
HELOCs (home equity lines of credit) vs. DSCR (debt service coverage ratio) loans
Best tools to use and metrics to track when looking into out-of-state investing markets
And So Much More!
(00:00) Intro
(00:46) Is the 1% Rule Dead?
(08:24) Building vs. Flipping Houses
(14:30) Are Turnkey Rentals Worth It?
(20:56) HELOCs vs. DSCR Loans
(25:07) Local Market Metrics to Track
(30:46) Ask Us Your Question!
Check out more resources from this show on BiggerPockets.com and https://www.biggerpockets.com/blog/real-estate-953
Interested in learning more about today’s sponsors or becoming a BiggerPockets partner yourself? Email advertise@biggerpockets.com.
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How to Use the BRRRR Method to “Invest on Repeat”
962: How to Buy a Home (or Entire Neighborhood) With Your Friends and Family w/Phil Levin
961: Seeing Greene: How to Avoid High Down Payments and When to BRRRR vs. Buy New
960: No Cash Flow in Your Market? How to Invest Out-of-State Like a Pro w/Jessica and Shyd Coloma and Michael Gallagher
959: BiggerNews: 2024 Housing Market Update and Why Prices Are Still Rising
958: Hiring a Property Manager 101: Make More (in Less Time) from Your Rentals w/Luke Rzepiennik and Michael Vialpando
957: Seeing Greene: Flood Zones, New Builds, & Does Mexico's Cash Flow Beat the US?
956: How a 3% Interest Rate Cost Me Over $180,000 (Avoid My Mistake) w/Tanner Litchfield
955: BiggerNews: Real Estate vs. Stocks, the Ultimate Wealth-Building Debate w/The Motley Fool!
954: Cheap Old Houses: Buying Fixer-Uppers for Just $100K w/Ethan and Elizabeth Finkelstein
952: From Broke College Graduate to Financial Freedom While Living Abroad w/Dave Meyer
951: BiggerNews: Why Low Mortgage Rates Can't Solve Our Affordability Crisis w/Andy Walden
950: The Easiest Way to Invest in Real Estate in 2024 w/Terrence Terrell
949: Seeing Greene: Is Losing $800/Month in Cash Flow Worth $200K+ Equity?
948: 10 Rentals in 5 Years by Buying in Overlooked Short-Term Rental Markets w/Jarrod Tucker and Yiwei Cheng
947: 2024 Deals We’re Doing with High Cash Flow and Rock-Bottom Rates (4.75%!)
946: How to Supplement Your Income with Real Estate (So You Can Do What You Love) w/Juliet Lalouel
945: Seeing Greene: Stolen Properties and Why Your Rate Doesn't (Really) Matter
944: 3 Ways We Find Real Estate Deals Even During the Harshest Housing Markets
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