How to Buy and Hold Real Estate For the Long Term

In this article I’ll discuss three strategies you can use to buy and hold real estate for the long term. I will discuss the Cash flow metric, Leverage, and Single-family homes versus multifamily residences. I will also explain the benefits of buying single-family homes vs. multifamily residences. In addition, I’ll discuss how to determine the market’s demand for real estate, as well as other aspects of the investment.

Cash flow metric

One of the most important monetary metrics for buying and holding real estate is cash flow.

Investors who focus solely on appreciation will enjoy a higher return, but also carry higher risks. Most investors utilize both metric for a safe and profitable investment. However, investors should know the pros and cons of cash flow and appreciation when determining whether a property is right for them. Listed below are the two most important types of real estate.


Using other people’s money to purchase real estate is a common way to increase your returns on your investments. Using a hard money loan to finance your investment, you will put up only 10% of the purchase price and put down another 20% for repairs. This will leave you with a net cash flow of $350,000. In this case, your ROI is 9%, but you have paid interest on the loan of 5%.

Single-family homes

When it comes to cash flow investments, single-family homes are the best choice. Not only do they tend to be less expensive to buy, but they also offer more privacy. Single-family homes also tend to have lower vacancy rates than multi-family units. Many single-family homes also have desirable amenities such as extra square footage and yard space. Moreover, single-family properties in good neighborhoods tend to rent for longer than multi-family units, which means less hassle and fewer headaches for investors.

Multifamily residences

Buying multifamily residences is similar to purchasing a single-family principle residence. The buyer hires a real estate broker who collects a commission from the seller. However, there are some differences between the two approaches. First, buying multifamily homes requires a bit of due diligence and understanding of how the multifamily market works. While negotiating with a seller’s agent, there is a risk of being counteroffered. In such cases, a buyer should consider purchasing insurance and arranging an inspection. Finally, it’s vital to prepare the property for the arrival of tenants. A renovation may be needed to make the property more appealing to potential tenants, and a management plan must be created.


A REIT is a corporation that buys and holds real estate. The company’s income is distributed to shareholders in the form of dividends. The investment requires the company to earn a minimum dividend rate and invest at least 75% of its total assets in real estate. These properties generate a high level of income and are generally difficult to sell. The dividend rate of a REIT is a major draw for investors.