If you had $160k in cash, how would you enter the market?
Hey guys - my first post on BP, and absolutely thrilled to be here seeing how everyone seems pretty knowledgeable about building wealth. Was wondering your opinions...
Right now I have roughly $160,000 in expendable cash sitting in my bank account - all tax clear money I earned through my online businesses. I'm still pretty young at 25, so there's no reason not to take risk with my money since I have a lifetime ahead of me to recover.
My goal is ambitious. I want residual monthly income, and a ton of it. I want to be free of the matrix forever.
If you were in my position (I have absolutely no experience with real estate at all - I know what you guys are thinking right now haha!) how would you dive into the market given the available cash leverage I have?
My business still does a solid $250k a year in profit, so I have additional sources of income that might appeal to investors.
I think the problem will be credit history: I've never taken out a car loan or house mortgage, but have had credit cards since 18 and have been paying them on time with no outstanding debt.
Now guys, believe me, I know this is not just a cash and grab over-night riches thing. I realize like any business opportunity, you have to treat it as that: a business. I do all my due diligence before I enter into ANY business.
With that said, I think you can see here I don't want to move slow. I want to get into this market while prices are low now - and build enough leverage early on - without biting off more than I can chew.
From what I've learned so far, here's what I think might work well for me:
Start out in my local Baltimore market, tackling one market at a time to keep my business streamlined and organized.
1) Put down 30% on one complex priced at $300k.
2) Run that complex for a month or two on my own until I get a general idea of what the hell I'm getting myself into.
3) Hire property management company to take over my management responsibility of the property.
4) Replicate, rinse-repeat?
After you have say 3-4 properties, how does the overall workload of the business owner increase if it's all being handled through property management companies?
What do you guys think? I guess what I'm asking is how do you think I can take advantage of the advantage I have, without getting myself into too much too fast?
Thanks guys!
Dan