Buy and Hold
Definition:
Buy and Hold is a long-term real estate investment strategy where investors purchase properties and hold them for an extended period, typically to generate rental income and benefit from property appreciation. The buy and hold strategy is considered low-risk compared to shorter-term strategies like fix-and-flip, and it’s popular among investors looking to build long-term wealth and passive income.
🔍 Did You Know?
Buy and hold investors often use leverage (mortgages) to acquire multiple properties, allowing them to scale their portfolio over time.
Examples:
Example 1:
An investor buys a single-family rental property for $200,000, rents it out for $1,800 per month, and holds the property for 10 years, benefiting from both rental income and property appreciation.
Example 2:
A real estate investor purchases a multi-family apartment building, holds it for 15 years, and enjoys steady cash flow while the property appreciates in value, eventually selling it for a significant profit.
Why It’s Important:
Buy and hold is a popular strategy for investors looking to generate consistent cash flow while building equity in properties over time. It’s a relatively passive investment approach that offers long-term financial security and the potential for substantial returns through appreciation.
Who Should Care:
- Real estate investors focused on long-term wealth generation.
- Property managers overseeing the day-to-day operations of buy-and-hold properties.
- Lenders providing long-term financing for investment properties.
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