Home / Glossary / Buy and Hold
Buy and Hold
Purchasing rental properties and holding them long-term for cash flow, appreciation, and tax benefits.
Definition
Buy and hold is the most common real estate investment strategy, involving the purchase of rental properties with the intention of holding them for years or decades. Returns come from four sources: monthly cash flow, equity buildup through mortgage paydown, property appreciation, and tax benefits like depreciation. This strategy benefits from time — the longer you hold, the more rent grows, equity builds, and appreciation compounds. Buy-and-hold investors prioritize stable cash flow and strong fundamentals over quick profits. The strategy is particularly powerful when financed with long-term fixed-rate debt that gets cheaper in real terms as inflation raises rents.
How This Relates to DSCR Loans
DSCR loans are purpose-built for buy-and-hold investors. The 30-year fixed rate options provide the stable, long-term financing that this strategy requires.
Related Terms
Cash Flow
The net money remaining after all income is collected and all expenses and debt payments are made.
Appreciation
The increase in a property's value over time due to market conditions, improvements, or both.
Depreciation
A tax deduction that accounts for the wear and tear of a property over its useful life.
Equity
The difference between a property's market value and the outstanding mortgage balance.
Compare rates from hundreds of lenders instantly. No personal info required.