Codie SanchezFounder @ Contrarian Thinking

A MUCH better investment than real estate

22 May 2026 · 1 min

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In this segment of her YouTube video, Codie Sanchez argues that buying a single‑family home to rent out is a poor way to generate wealth. She cites the U.S. average home price of $400,000 and notes that typical rental income translates to roughly $167 of profit per month, a very low return on a large capital outlay. She then contrasts this with purchasing a small business for the same price, financed partly through SBA or seller financing. According to her, the average small business yields a 10‑15% annual return, producing tens of thousands of dollars in cash flow—far superior to the modest rental income. The overall message is that small‑business acquisition is a far more lucrative investment than residential real‑estate ownership.

Chapters

Real estate is an awful way for you to actually make money. Option 1, you can go buy a single-family home for $400,000, the average price in the US, and then you rent it out to somebody. Well, the average rent nets you profit-wise about $167 a month. So you're taking a $400,000 risk for like a couple hundred bucks a month. Then you take the average small business you could buy, same way you could for buying a small piece of real estate. So $400,000 business, you put some money down and get the rest from the SBA or seller financing, and the average small business makes 10 to 15% per year. You're still cash flowing tens of thousands of dollars from a business instead of a real estate