What are the differences between investing in rental property and flipping houses?
With rental properties, the strategy is buy and hold. The typical holding period should be 5 years or longer. Ideally, the rental properties will cash flow, which means that the rental income covers the mortgage, property tax, and insurance payments. This allows the investor to maintain the property with very little out-of-pocket expense. Over time, the properties should increase in value. This is where true real estate wealth lies: property value appreciation.
