What Are 1% Houses and Why Should Remote Indiana Real Estate Investors Know About Them?

Every real estate investor should know about 1% houses.  A 1% house is a any property that rents for 1% of its value.  Today we will talk about how to use this measure to make smarter decisions and create generational passive income with Indianapolis real estate from out of state.

First of all, THANK YOU again for making this channel the number one channel for Indiana real estate on YouTube according google analytics and SocialBlade info for BigReia.com. 

What Are 1% Houses?

Short answer: A 1% house is a house that rents for about 1% of the value.

For example a $150,000 that rents for $1,500 (1%) would be a 1%.

Sometimes it makes sense to go for houses that are LESS than 1%:
A Safehouse can be less than 1%.

You’ll see this as you go through our Deal Dissections and real life deal breakdowns.

Let’s say you have $400k to invest and you want to have slightly positive cash flow.

Or breakeven at the worst.

You can buy 10 houses in Indy for $150k each – 20% down plus closing costs is about $40k.

They will give you a bit better than breakeven cash flow and will appreciate about 100% over 10 years.

If you lease option them and get a bit more to apply toward principal, they will pay off in 9 to 15 years. At the end, they will be worth about twice what you paid ($1.5 million X 2 = $3 million) and have a between $10k and $20k per month of income.

So you turned $400k into $3 million in equity and 10k to 20k per month in 10 years.

OR

With the same $400k you buy one house worth $1.5 million ($350k down plus $50k closing costs).

So you have a new loan of $1.15 million that has a mortgage payment of approximately $9000 a month, but it only rents for $4500 a month, so you have a negative cash flow of $4500.  Eventually the rents will rise to cover the mortgage, but it will take 10 years just to breakeven.

So that costs $4,500 x 120 = $540k over 10 years.

Let’s say the values increase 20% instead of 10%, that gives you 200% over 10 years.

So now you are worth $4.5 million.

You still owe a million on the property. You also put almost a million of your own cash into it.  So your equity position is now $2.5 million. Not bad, and you are breaking even on your income for the next 10 or 20 years while you pay it off.

So in 10 years with $400k investment in Indy you turned $400k into $3 million in equity plus you now get to take home 10k to 20k per month. 

Again that would take about 10 years.

In a place like LA, where the values are ten times higher and the appreciation sometimes goes up to 20%, you end up with $1 million in cash out of your pocket. You now have $2.5 million in equity but you have 15-20 years left before you start to get income.

If you spent that full million in Indy and bought 20 houses, you’d have $6 million in equity and $20k to $40k per month after 10 years.

Same amount of money, just allocated differently.

Two very different outcomes…

Even though the higher priced home had twice the appreciation.

And it’s possible values could drop in a more volatile market – we saw 60% drops in 2008.

Those were Joe’s notes, here are Azam’s NOTES:

Financial discipline gets diluted with headlines about crypto, billions, RE, etc.

It is important to keep perspective, this isn’t just about 1% houses, it is about understanding the math to identify and collect Safehouses.  This is how you build a runway to ANY passive income target and know for sure how long it would take – all math based.

“If one oversteps the bounds of moderation, the greatest pleasures cease to please.”
~ Epictetus

Here’s an interesting quote from Admiral William H. McRaven:

“What do you need to know as an officer? What is the most important thing you should consider when developing a plan? What is the most fundamental aspect of war strategy, operations, or tactics?  No plan of operations reaches with any certainty beyond the first encounter with the enemy’s main force.  In other words, always have a Plan B.  A contingency plan.  A backup plan.  Because once you encounter the enemy, no plan survives first contact.”

You will “fail” in one way or the other, the secret is being able to absorb the shocks with expectation and a planned reaction.  Whaever your ideas are on a house, rental property, rehab, etc. those ideas will not survive the first wave of unseen challenges.

Like Mike Tyson said:

“Everyone has a plan until they get punched in the mouth.”

That is what 1% house are all about – being able to get punched in the mouth.

1% and Safehouses = ADAPTABLE

This is about creating a FOREVER FUND:
Generational passive income
Creating irreversible Income Ascension
To do that we use conservative projections to develop FLOORS

We can find 1%, 2% and even 3% houses
3% = under 30k
2% = Under 45k
1% = Under 150-200k
So why focus on the 1%
OUTCOMES = the goal is 1k/month FOREVER… then 2x every 10-15 years

Passive Income = Equity x Production
We CREATE equity from buying/building real estate and businesses
What skill does with business TIME does with real estate
With 1% Safehouse gives predictability and scalability

That being said remember the team and who should be on your team:
Realtors, lenders, PM, HML, appraisers, contractors and investors
Title companies, insurance, inspectors, accountants, eviction attorneys…

Make sure they got you connected and you can talk to them ahead of time too.

If you want a list of OUR contacts and every possible person that you will ever need to build your real estate business you can check out our People Page at BigReia.com/People.

The MOST important thing to look for are OUTCOMES.

Indy CAN be a great market for turnkey investing but you need to pick the right team.  Joe and Azam have an obsession of helping folks from around the world create 10-30k/month and far beyond so you can use that as a ruler to measure others against.

Here’s what to do next:

1.) Download a FREE copy of our book “The Book on Indiana Real Estate Investing from Out of State” and see how we help folks turn 200k into 100k/year passive income forever.

2.) Devour are FREE accompanying classes, videos and testimonials and make sure you are qualified and fully ready to apply for us to build you passive income and generational forever wealth.

3.) When you are SURE that the GRS program is for you, you can apply and after your interview (Joe or Azam will speak directly with you in your final interview) if your application is accepted we will begin immediately and start collecting Safehouse FOR you, you don’t have to do anything – you don’t even have to leave your house – everything is DONE FOR YOU.

So that’s how you create passive income with Indianapolis real estate from out of state.

As always remember that you can use our  People Page here for a full list of every contact you’ll ever need to build your real estate business.  Also we have a list of all the paperwork and contracts that we use and we add to this list regularly so you can download anything for free and feel free to send me feedback or requests.

Want us to build your real estate portfolio for you?

Apply for our Get Rich Slow (GRS) Program and have me and our team build passive income for you.

Apply here now.

In the meantime you can go through the previous Elevators, classes and other FREE training material and use it to grow your impact before you check out.  Use our stuff to both create passive income AND buy small businesses zero down, follow the steps, be kind, help others and you’ll…

Make the Universe Smile.

~ Indy Anna and Rachel and Eve
Love (at) BigReia.com
(YES that’s my actual Direct Line and I really do answer lol, so please text me first Thx!)

Want more (brilliantly) EPIC posts of real estate investing and bidness badasssery...?

There is a great post and class on the 38 Ways to Buy Apartment Buildings Zero Down with Pet Policies, and here are some other helpful and EPIC posts... for starters as a real estate investor if you ever want to build a business that makes you 30 grand a month then you MUST do this...

Wanna Create Generational Passive Income Buying Real Estate and Small Businesses?

Here's a class on exactly how to make $30,000 in passive income as an out of state Indy landlord.  Exactly how many Indiana rental properties do you need to make 30 grand a month.  Anna can you help me invest in Indianapolis turnkey real estate investment properties?

There's also a great class Azam did on how anybody can retire in the next 1-2 years with $30,000 a month in passive income by buying and selling businesses zero down.  What about Micro Flipping?  We have a great class on how to start micro-flipping real estate zero down from your house and make $500/day, speed wholesaling 101.

There’s also another great class on how to buy apartment buildings zero down that you can check out as well.  This relates directly to growing income on rental properties.  Speaking of which make sure to check out our epic page on 14 ways to avoid tenants from hell.  Also we have a great post on how to make build a "six figure a month" real estate wholesaling business.

Also here is a post on how I did this and I flipped a house off Zillow for 30.  Also you can check out the post on five steps to flip a house right off Zillow for 40 grand.  You can also check out our other epic post on 57 ways to make money with vacant land.

Here’s another post on how a Hero flipped a house off Zillow and made 40k in a few weeks while he was learning to read.  Also you want to check our post on the EPIC $25 million letter and the copy writing lessons for real estate investors, you'll love it.  Also you can see how ONE letter is making me $9,000 a month.  Also you can check out the post on 101 FREE places to advertise your houses.

Also check out the "SA" class and your REAL chances of create social mobility and income ascension with your real estate business.  Brilliant stuff.  Also there is a great post on the ONLY way you'll ever make 30 grand a month as a real estate investor and/or business builder.  Another brilliant class with a free downloadable Investor Guide is about 19 Ways to Make $10,000 a Month by Helping Tired Landlords.

Plus make sure you check out Azam's post on how to hire a realtor that makes you $10,000 a month... while you sit back with your shoes kicked up on your desk and fingers folded behind your head.  Also there is a great post on how to make five grand a week from putting out signs.

Also we have some great posts on 30 ways to buy real estate with no money down.  That is a two part series so make sure to watch the second part on the 30 ways to buy real estate zero down and with no loans or credit.  I also get questions about our "Epic Flipping" and how to turn $1 into over $25,000 by flipping ordinary items for exponentially high ROI.

And don’t forget our EPIC page on 100 FREE ways to find motivated sellers, we are making the number one page in the world on FREE ways of finding motivated sellers.  Also check out how I find motivated sellers from code violation properties, and also how I make over $1,500 a week giving investors access to that list

Speaking of lists, for a list of the "Good People" and My Indy Anna Homeys - this is a FREE list of EVERY possible contact that you'll ever need to build a real estate business in the Indianapolis or the Midwest.

You can also get a LONG list of every contract, piece of paperwork and legal document that you'll EVER need for your real estate business all FREE to download.

Also perhaps the most important class Azam has done is on the "Frequency of Thought" and how to use the laws of quantum physics to rewire your brain, attract brilliance like a lightning rod and be the best version of yourself.  Check out this epic 3-hour class on Quantum Real Estate.

When I first go started I thought wouldn't it be great if somebody put together ONE list of every possible contact that I would ever need to build a passive income with Indiana real estate - or any Midwest real estate?  Well that's exaclty what I did with our “People Page” here it is:

A totally FREE list of every possible real estate professional contact you’ll ever need to do unlimited deals, start and scale your real estate business and create generational passive income with real estate anywhere Indiana or the Midwest.

Stay here at BigReia.com and you’ll become allergic to being an LC and addicted to improving the world and creating Income Ascension and Social Mobility for you and yours… 

Thanks so much!  = )

Make the Universe Smile.

~ Indy Anna
Love (at) BigReia.com
(YES that's my actual Direct Line and I really do answer lol, so please text me first Thx!)

Free Comic Book Reveals:

100 FREE ways to find motivated sellers.

Free Comic Book Reveals:

100 FREE ways to find motivated sellers.