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In This Video:

00:46 No such thing as a risk free investment
01:07 Main Advantage and Disadvantage of Flipping Property
01:43 The Buying and Holding Strategy

G’day guys. Nic Griffith, I’m back again. Now if you are interested in property investing, property investment, or property investment strategies or advice, you’ve come to the right place.

I was asked the other day, a good question. Advantages and disadvantages of flipping versus a buy and hold strategy.

Personally, I’m a buy and hold strategy kind of guy and my whole portfolio is built around by buying and holding property.

No such thing as a risk free investment

A lot of people would like to flip properties as well. There’s a number of reasons for this. Again though before I answer the pros and cons, I would say that there’s no such thing as a risk free investment though there’s a number of things that we can do to mitigate and minimise risk along the way.

So flipping can be risky strategy. Essentially flipping is when you acquire a property, make improvements to the property, and then sell the property at a profit. It’s manufacturing growth within the property.

Main Advantage and Disadvantage of Flipping Property

The main advantage with flipping is that you can make some serious cash in a short amount of time. So it’s more of a cash-injection strategy as opposed to a growth strategy. Short-term cash injection strategy.

The main disadvantage of flipping though is that it can also cause you a lot of money. Especially if you don’t know what you are doing, you are inexperienced, you’re not good with budgets, you haven’t worked with trainings before, and you have to sort of work on those angles, all those seems to go wrong for you, it can cause you a lot of money upfront and then defeat the purpose of having chosen to flip a property in the first place.

The Buying and Holding Strategy

The buy and hold strategy, and this is what I do, is all about acquiring as many properties, as many well-identified properties in growth areas as you can and let the market do the work. It’s all about growth over time. The more properties you have, the more growth you’re going to get. It does make sense, doesn’t it?

Essentially we’re using the growth in each property to leverage into more properties. Accessing the equity in each property. And you quickly see how one property can become two, two can become four, and four can become eight just by accessing the growth in each property. The buy and hold is my preferred strategy.

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