"Should I build my rental houses?"

I’m a builder in TX and the idea of owning many rental properties excites me. Not wholesaling, L/O’s, or anything else. I’ve investigated them all and rentals seem most attractive to me.

I’m wondering if it would just be easier for me to build my own rental properties since I can build houses at wholesale. Instead of going out to try and find deals that would maybe get positive cash flow.

Selling my houses is fine but I have to keep building them in order to make money. I’m ready to start building my long term wealth.

The only challenge is the rising cost of building and finding land to build smaller houses that I can build in a good area. The tract builders have all the subdivisions in the price range I could build some rentals.

I usually build in the $200,000 - $500,000. I would need to build a house to rent for around $115,000. Which with today’s prices would be a stretch.

I would build them and carry 20% at closing so on a 200k house you could build for 160k or so then carry the note for 20% or 40k that would pay 312 per month and after two years they still owe just over $39,600 so you made over 7k on the note and sold the house way fast to a buyer that only quailfied for 80%,. And trust me those buyers are everywhere!

so if they do not refi after 2 years and you carry the note for the full 30 years you made $112,320.00 on your 40k.

so now if you carry 312 and build 25 houses you make $7,800.00 per month! and have $1,000,000.00 in notes.

It is better to be the bank then it is to be an investor!