Blog | Real Estate

Your Home is Not an Asset…Could it Be?

These home buying hacks can make you money from day one.

Summary

• Before "investing" in a house, make sure you know the difference between an asset and a liability

• Your house is actually a liability...until you follow these hacks

• You can use your home to build wealth- here's how

---

Buying a home often feels like the ultimate milestone—something to celebrate with a big smile and that heartfelt moment of unlocking your new front door. It’s natural to believe it will be a great investment, too. After all, many so-called financial experts keep insisting, “Your house is your biggest asset!” That’s why Robert Kiyosaki’s Rich Dad Poor Dad caused such a stir. He argued that your home is not necessarily an asset if it keeps pulling money out of your pocket every month without putting any intoyour pocket.

Why your house might be a liability (and how to fix it)

Now, just because your house isn’t necessarily an asset, doesn’t mean you should never buy a home. It simply means you need to be realistic: if a house costs you more than it makes you, then it’s a liability.

However, there’s a twist. If you manage to buy your home at a price below fair market value, you could end up with instant equity. That equity could then be borrowed against to invest in real assets—like rental properties—that generate income. Think of it as transforming your home from a typical liability into a personal “bank” that can help fund your journey toward financial freedom.

Let’s explore how it all works, why this strategy is different from common advice, and what steps you can take to find a below-market home in the area where you actually want to live.

What’s the difference between an asset and a liability

In the Rich Dad world, the difference is incredibly simple: an asset puts money into your pocket, while a liability takes money out of your pocket. Traditional wisdom teaches that a personal home is an investment, but consider the ongoing costs: mortgage interest, property taxes, maintenance fees, renovations, and even the potential stress of a downturn in property values.

Imagine paying your mortgage month after month, along with insurance, repairs, and yard upkeep. Do you see any money returning directly to you? Probably not. Many people justify this by talking about tax deductions and building “equity.” But you’re still the one forking out cash every month. The bank is making money from your mortgage, especially in the early years when interest payments dominate. By this definition, your home acts more like a liability than an asset—unless you use it strategically. That’s where buying below market value and creating a chunk of instant equity can change everything.

Turning your house into an ATM: this is how you build equity

A home can become an asset if you create value at the time of purchase. The simplest path to achieving this is to buy your property at a discount. Let’s say you find a house listed at $300,000, but after negotiation, you manage to secure it for $270,000. If the home’s true market value is indeed around $300,000, then you’ve got $30,000 in “instant equity” the day you close.

How does this equity help you? You can tap into it through a home equity loan or line of credit (HELOC). That borrowed money can then go toward a real investment property—like a multifamily rental that puts monthly cash flow in your pocket. If done properly, this arrangement means you’re putting money in your pocket, effectively offsetting or even surpassing the monthly costs tied to your house. By converting the equity in your home into an investment in income-producing assets, you’re turning something that used to feel like a financial drain into a springboard for growing your wealth. The key is ensuring you truly get a discount at the outset, rather than gambling that the market will keep going up indefinitely.

Then the opportunity becomes greater. What if the new investment property was also purchased with equity in it? Maybe that could be used to buy another investment property. And what if that property was bought with equity in it?

Keep reading to learn how to find your home and your investment properties.

Caveat: you still need a place to live

All these ideas may sound great, but you can’t forget the practical aspect: you still need a home that suits your lifestyle. Location matters for your job, schools, commute, and overall quality of life. Naturally, this narrows your search to a specific neighborhood or city. That’s okay. Just remember that finding a property below market value often involves patience and some flexibility. Maybe you look for a house that needs minor updates. Maybe you’re ready to bargain with a motivated seller. While the search may be more limited, scoring a better purchase price in your preferred area is still possible.

How to: 7 tips to help you find homes with “automatic equity”

Buy your home and start building wealth now

By now, you can see how a standard home—something many people wrongly call an “asset” from day one—can shift into a genuine wealth-building tool if purchased at a discount. You’ll still live there, pay a mortgage, and shoulder the usual homeowner costs, but the goal is to acquire that house at a low enough price that you gain immediate equity. You can then pull out some of that equity for real investments that put money directly into your pocket each month.

Remember: you want to live in this property, so don’t compromise on what you truly need. Focus on the steps that matter—searching for foreclosures, networking with local experts, or running targeted ads. Each method helps you uncover a home with built-in equity. Once you secure that advantage, you’re free to transform your personal residence into the funding source that powers your investing ambitions.

1. Leverage public records for foreclosures and liens

   Local courthouses and government websites often list foreclosure notices, tax liens, and other legal filings. These records can reveal homeowners under urgent financial pressure. For example, someone facing foreclosure may accept a lower sale price just to avoid further credit damage. By spending time looking through these filings (or using online search tools that aggregate them), you may uncover hidden gems. A distressed seller might prefer a quick, certain sale over a lengthy wait at full price—an ideal scenario for buying below market value.

2. Use online real estate platforms and databases

   Websites like Zillow and Redfin allow you to filter for “fixer-upper,” “foreclosure,” or “motivated seller.” Some sites also track pre-foreclosure properties, helping you reach owners before they’re overwhelmed by lenders. Keep an eye on new listings and drastic price drops. Consistent monitoring can help you pounce on deals that others might miss or overlook initially.

3. Drive for dollars

   Sometimes the old-school approach is best. Cruise around neighborhoods you like, watching for signs of neglect: overgrown lawns, boarded-up windows, or piled-up mail. Such visuals can indicate that owners are struggling or absent. Note the addresses, then research the property to find contact details. A friendly inquiry could lead to an off-market opportunity well below market price.

4. Target probate and inherited properties

   Heirs often inherit homes they don’t want to manage or maintain. They might be more interested in a quick, hassle-free sale than in waiting for top dollar. By checking probate court records or reaching out to estate attorneys, you can learn about recently inherited properties. Approach sensitively—this is often a delicate time for sellers. Highlighting your willingness to purchase the home “as is” can be a big draw, since it spares them from the costs and headaches of repairs or updates.

5. Tap into local real estate networks

   Real estate agents, mortgage brokers, and property managers frequently learn about homes going on the market before they’re publicly listed. Attend meetups or local investor clubs to build relationships and hear about off-market leads. Many industry professionals appreciate having a direct buyer ready for their distressed or time-sensitive sellers.

6. Direct mail campaigns

   A well-targeted postcard or letter can grab the attention of a homeowner who is on the fence about selling. Personalize your message. Emphasize that you can purchase quickly and simplify the process.

7. Social media ads and online marketing

   Platforms like Facebook or Google Ads allow you to focus on specific neighborhoods. Use simple headlines—“Need to sell fast?” or “We buy as-is”—to attract interest from owners who might otherwise wait. This modern tactic often complements your traditional efforts in uncovering below-market properties.