Written by David Dodge 

I’m diving deep into the rental markets and why I love wholesaling properties to build my portfolio. Wholesaling is an essential skill that not only helps you generate profits but also allows you to cherry-pick the best deals to hold onto for long-term rental income. In my case, my rental properties generate over $20,000 a month in cash flow.

Why I Love Rental Properties

Rental properties are an amazing way to generate consistent, passive income. What’s even better is that I’m able to close fast and buy homes on my terms, without the need for extensive repairs. This efficiency makes the process straightforward, and I get to enjoy the best part—holding onto properties that generate strong cash flow.

Now, here’s the cool part: for the properties I don’t want to keep, I simply wholesale them. By cherry-picking the best deals for myself and wholesaling the rest, I can still close 4 to 10 deals every month. It’s a great way to create quick profits and reinvest them in properties that will provide long-term financial stability.

Wholesaling vs. Investing: What You Need to Know

I want to take a moment to clarify something important: wholesaling isn’t really investing. If you think it is, you're probably mistaken. Wholesaling is more of a marketing business that requires spending time, energy, and often money to make a profit. The key is that wholesaling provides us with the opportunity to learn valuable skills in the real estate business while still earning money.

While wholesaling can be lucrative, it’s not an investment strategy on its own. Instead, it’s a great stepping stone for people to build confidence and generate capital, which they can use for true investing—like buying rental properties.

If you'd like more explanation, watch the video below

How to Choose the Right Rental Markets in 2025

Let’s talk about rental markets. The ideal rental market is one where you can buy properties at a good price and generate a solid rental income. In my experience, it doesn’t make sense to purchase a $400,000 property that rents for only $2,000 a month. The return on investment is just too low.

A much better strategy is to focus on properties that have a strong rental yield. For example, if I can buy a property for $80,000 that rents for $1,200 a month, that’s a fantastic deal. The rule of thumb I use is the “one percent rule”—for every $100,000 spent on a property, it should generate at least $1,000 in rental income per month.

In some markets, you can even achieve the “two percent rule,” where you can buy a property for $50,000 and rent it out for $1,000 per month. This is an ideal scenario because it allows for much higher cash flow.

In my portfolio, I typically see a return between 1.2% and 1.3%, meaning some of my properties generate $200–$500 a month in cash flow after expenses.

Finding the Right Rental Markets for 2025

To identify great rental markets in 2025, it’s important to focus on areas where property values correlate closely with rental income potential. The key is to find markets where you can secure properties with high rents relative to their purchase price.

Another way to find these markets is to network with local real estate investors. Attend meetings at your local Real Estate Investment Associations (REIAs), join Facebook groups, and ask other investors where they’re having success with rental properties. Building these relationships is crucial for both learning and growth in your real estate business. In fact, around 30% of our deals come from other investors who we collaborate with.

Remember, there’s no need for a scarcity mindset in this business. There are plenty of deals out there for everyone. In fact, our team buys around 100 houses a year in our local market, and you can do this too!

Key Takeaways:

1. Focus on finding properties with rental prices that correlate well with their value.
2. Use wholesaling as a stepping stone to build capital and confidence.
3. Attend local REIA meetings to network with other investors and learn from their experiences.
4. Adopt an abundance mindset—there’s plenty of opportunity out there!

Get out there and start building your real estate portfolio!