Dennis Henson

Creating Multiple Streams of Real Estate Income
by Dennis Henson

There are many great benefits from investing in real estate. Not the least of which is the opportunity to develop a number of streams of income from your real estate business. Having money coming to you from many different sources will not only give stability to your real estate business but is also a great way to generate cash flow which is the life blood of your business.

Other than the normal income from sales of homes and monthly rental income, there are many other streams of income that can be generated by owning and managing properties. Here is a list of just a few possibilities for income from real estate.

Additional Income Sources:
  1. Notes
    Notes are a great way to set up additional income streams. When you sell a property you can usually get a much higher price if you are willing to finance part of the sale. By simply taking a note secured by the property you have your first small stream. Well it may seem more like a drop but for now we can call it a stream. Adding interest to the note will increase the income and give you a fair return on the money you are owed. Each note you add is another small income source.

  2. Options
    Another great way to increase your income is by selling options to purchase your properties that include lease or rental payments. Option money is usually non-refundable and if you do lots of options you have another stream of money coming in.

  3. Late Fees
    It is unfortunate but when you manage renters-they are often late with their rent payments. Some landlords just let late fees slide and do not attempt to collect them. This is a big mistake! By being strong and charging what the contract spells out you win in many ways. The renter will either start paying on time or have to pay the late fees. Of course they just may decide to leave altogether and you also win because then you can get a better tenant. In any event if you stick to your guns and charge late fees like a real business you will find that you have created yet another stream of income.

  4. Rent Increases
    At the end of every lease period you have the opportunity to generate more income by simply making small increases in the amount of rent due each month. This may seem trivial but if you have just ten single-family homes and increase the rent on each of them by just fifteen dollars per month you have an additional $1,800.00 a year coming in each and every year! If you continue to do this for five years that $1,800.00 will have grown to a whopping $9,000.00 and that is a nice stream!

  5. Additional Rent
    At the end of every lease period you have the opportunity to generate more income by simply making small increases in the amount of rent due each month. This may seem trivial but if you have just ten single-family homes and increase the rent on each of them by just fifteen dollars per month you have an additional $1,800.00 a year coming in each and every year! If you continue to do this for five years that $1,800.00 will have grown to a whopping $9,000.00 and that is a nice stream!

  6. Loans Against Equity
    One of my favorite income streams comes from borrowing money from the equity from my existing properties. This income is tax free and can be a life saver at tax time or when your spouse wants that trip to Europe for your anniversary.

  7. Vacant Land Repurposing
    If you have a big lot or even two lots, many times there are opportunities to rent it out. Some of that space could be used for other things. An example might be parking or a storage building. Use your imagination and create another stream of income

  8. Deposits and Maintenance Fees
    Deposits on rented property belong to the renter but when a renter leaves a property in poor condition the money to bring the property back up to good condition must come from somewhere. I prefer to use the renter's money to do this fix up so I collect a substantial security deposit. Often renters will just leave the property without notice or without completing their lease agreement. When this happens, if your agreement is written well, you get to keep the deposit. It is not unusual for this scenario to take place several times a year and yet another stream is introduced.

  9. Mineral Rights Sales and Leases
    With the price of petroleum products at an all time high-the mineral rights you have in you property might be worth a great deal. These rights are very marketable and petroleum companies are becoming very aggressive. These companies have a lot of money and might be willing to pay you some of it to lease or purchase your mineral rights. Leasing your mineral rights can create a healthy stream of income for you especially if oil or gas is discovered on your property.

  10. Finder's Fees, Consignment Fees, Consultation Fees & Coaching Fees
    The real estate investing business offers quite a few possibilities for income streams by charging fees. These fees could be for consignment of a contract or for consultation on a real estate project. You could charge fees for coaching new investors in how to get started or even for helping them find their first deal.

  11. Tax Rebates and Certificates
    Finally, there are a great number of tax advantages for the real estate investor. If you play your cards right you could be able to have the government provide you with an additional stream or two of income! By purchasing tax certificates you should be able to realize some exceptional returns from your investments and if you are lucky you could end up owning one or more additional properties.



Dennis Henson
Dennis Henson is a full-time real estate investor, author and mentor in Arlington, Texas. He is president of Vanguard Marketing and Investments, Inc. and AREA real estate investor's group.

Dennis has a B.S. Degree in education from Jacksonville State University and a Master's Degree in Education from Mississippi State University. He purchased his first investment property in 1971 in Georgia and has taken numerous courses by real estate gurus including John Schaub, Robert Allen, Carleton Sheets, Wade Cook, Russ Whitney, Dolf de Roos, Mike Summey, Roger Dawson, Bill Barnett, and many others.

Dennis Henson enjoys investing in real estate, helping people find and purchase a new home, working with new and experienced investors and advanced teaching real estate investing techniques. Many years of experience, constant study, and love for teaching have made Dennis Henson an excellent author and mentor.


Copyright Notice
Copyright 2002-2018 All Rights Reserved. Published with Permission of Author. No part of this publication may be copied or reprinted
without the express written permission of the Author and/or REIClub.com.

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