After forty years as a real estate lender, I believe that buying homes and renting them out is, over time, an excellent formula for wealth. I don’t care if it’s five homes or fifty, or a hundred, it is a great way to build wealth. What happens along the way is, first of all, the value of the home will generally increase (no guarantee there, but well researched properties will generally increase in value). Throughout the process that might go on for a few years or fifty years, offers to sell some of these properties will come along that are too good to resist. Go ahead and do it and take the profit. Others will stay on the books as rentals - nothing wrong with that. This business is very easy to get into and does not take a rocket scientist to understand. One thing I would caution - it is OK to use mortgages to gain leverage, but always be honest on your loan applications. If you are going to use it as a rental, be sure to disclose that on the loan application. The financing may cost just a little more than for an owner occupant, but avoiding fraud on mortgage applications is very important. If you just purchase one house a year and add it to your portfolio, in ten years you will have ten homes earning cash flow and appreciation. I believe it is a sound business model.