{"id":91823,"date":"2017-10-18T05:00:02","date_gmt":"2017-10-18T11:00:02","guid":{"rendered":"https:\/\/www.biggerpockets.com\/renewsblog\/?p=91823"},"modified":"2021-03-16T13:39:12","modified_gmt":"2021-03-16T19:39:12","slug":"thrifty-real-estate-deals","status":"publish","type":"post","link":"https:\/\/www.biggerpockets.com\/blog\/thrifty-real-estate-deals","title":{"rendered":"4 Sample Investment Properties You Can Purchase With Just $10k in Savings"},"content":{"rendered":"

I posted a story recently<\/a> about quick, affordable ways to get in the asset column when all the real estate just so happens to be too expensive.<\/a><\/span><\/p>\n

But even if you’re ballin’ on a budget, you can still play, even with just $10,000 in savings. You may not be in the league of a Billionaire\u2019s Row high rise, but there are still deals that will get you in the game\u2014and get you valuable experience. Here are four examples.<\/span><\/p>\n

(Note: These deals are for illustrative purposes only, chosen randomly, to show the economics behind an acquisition. They have not been vetted and may have gone off the market at press time.)\u00a0<\/span><\/p>\n

1. Multifamily in New York<\/h3>\n

\"\"
[Image source: Loopnet.com]<\/em><\/figcaption><\/figure>What:\u00a0<\/strong>Four units
\nWhere:\u00a0<\/strong>Rochester, NY
\nPrice: <\/strong>$49,900
\nDown Payment:\u00a0<\/strong>$7,485<\/p>\n

It’s obviously not New York City, but the truth is you could<\/em> pick up a multifamily property<\/a> in the third-most populous city in New York for under $50,000\u2014 in fact, for $49,900, to be exact. (Listing here<\/a>.)
\n
\nRelated:<\/strong> 5 Ways to Start Investing in Real Estate With Just $5,000<\/a><\/em><\/p>\n

With 15% down ($7,485; $10,000 at 20% down) and a conventional financing, you can get an income-producing asset making you money right away. (It goes without saying to make sure you run the numbers first to make sure the dollars make sense.)<\/p>\n

And a cool sidebar about Rochester? Yields are super high. Check out this 10-unit with a whopping 18.10% cap rate<\/a>.<\/p>\n

2. Quad by the Beach<\/h3>\n

\"\"
[Image Source: Loopnet.com]<\/em><\/figcaption><\/figure>What:\u00a0<\/strong>Quadplex
\nWhere:\u00a0<\/strong>Clearwater, FL
\nPrice: <\/strong>$250,000
\nDown Payment:\u00a0<\/strong>$8,750<\/p>\n

Just minutes from Clearwater beach and golf courses, an FHA loan could get you this four-unit property with just $8,750 down, assuming it’s delivered vacant and you can occupy one unit.<\/p>\n

According to the Loopnet listing<\/a>, the deal is on the market at a 9.60% cap rate, each unit generates $750 per month in rental income, and the total take (NOI) for the year is $24,000.<\/p>\n

Now, with to the mathematics of your mortgage, per this FHA mortgage calculator,<\/a>\u00a0your monthly payment (assuming a 4% interest rate, PMIs and amortized over 30 years) comes out to\u00a0$1,676.14 every month.<\/p>\n

At the very least you’ll be living that rent-free beach life\u2014or very close to it.<\/p>\n

3. Jacksonville Value-Add<\/h3>\n

\"\"
[Image Source: Loopnet.com]<\/em><\/figcaption><\/figure>What:\u00a0<\/strong>Four 1-bedroom\/1-bathroom units
\nWhere:\u00a0<\/strong>Jacksonville, FL
\nPrice: <\/strong>$79,000
\nDown Payment:\u00a0<\/strong>$7,900<\/p>\n

It’s not the prettiest thing in the world, but it’ll get you going if you’re starting out.
\n
\nRelated:<\/strong> 3 Feasible Ways to Start in Real Estate Wholesaling as a Complete Newbie<\/a><\/em><\/p>\n

Financed with a 10% down payment (which is doable; a young first-time buyer scored 10% for a duplex in New Jersey 15 minutes from Midtown Manhattan), you’re in for $7,900 (plus closing costs, of course) for 3,306 square feet in the most populous city of Florida.<\/p>\n

There’s even the option of seller financing. (Check out an epic Brandon Turner piece<\/a>\u00a0on that topic here.) Either way you go, the deal comes packaged with a huge 20% cap rate cushion, per the listing<\/a>, leaving you plenty room for rookie mistakes.<\/p>\n

That said, it’s a “distressed sale” (jargon for owner’s out of money), so expect some CapEx<\/a>\u00a0on something like this one.\u00a0In this case, however, that’s not a good thing; that’s a\u00a0great\u00a0<\/em>thing.<\/p>\n

You see, the cool thing about a value-add play is that you can drive the value right away, increase the equity, and give a nice boost to your net worth.<\/p>\n

4. Condo by Disney World<\/h3>\n

\"\"
[Image Source: Trulia.com]<\/em><\/figcaption><\/figure>What:\u00a0<\/strong>3 bedroom\/2 bathroom condo with pool, parks and gym
\nWhere:\u00a0<\/strong>Orlando, FL
\nPrice: <\/strong>$135,000
\nDown Payment:\u00a0<\/strong>$4,725 (FHA)<\/span><\/p>\n

As a rule of thumb, you always want to hedge against vacancy by having as many units as possible\u2014hence why income-producing assets always beat single-family rentals in that regard.\u00a0<\/span><\/p>\n

With SFRs, you can go from 0 to 100% occupancy quickly, which carries greater risk. With 10 units on one mortgage, the remaining nine tenants are there to service your debt.<\/p>\n

(Interesting aside: The multifamily vs. SFR<\/a> is a heated debate that rages on amongst investors.)<\/p>\n

All that said, this here is a nice little deal close to Disney World, for very little money up front, that could make you a few bucks as well when you’re not in town. (Note: This particular deal is “for sale by owner,” meaning he may prefer cash deals.)\u00a0<\/span><\/p>\n

This deal (see listing here<\/a>) comes with fancy amenities like a lake, swanky pool, a full YMCA-style basketball court, and a gym. Orlando is a tourist-heavy city and prime for Airbnb. Similar pads go for $60<\/a> a night, which opens up the door for extra income.<\/p>\n

For a first-time investor with $5k saved up paying rent, a lake and a pool are not be the worst places to start.<\/p>\n

\"\"<\/a><\/p>\n

Have you stumbled across deals with accessible price points in your market lately?<\/em><\/p>\n

Let me know your thoughts with a comment!<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Even if you’re ballin’ on a budget, you can still play, even with just $10,000 in savings. Check out these 4 real properties on the market as proof.<\/p>\n","protected":false},"author":105651,"featured_media":93188,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[5524],"tags":[],"class_list":["post-91823","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-real-estate-investing-for-beginners"],"acf":[],"comment_count":0,"_links":{"self":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/posts\/91823","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/users\/105651"}],"replies":[{"embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/comments?post=91823"}],"version-history":[{"count":0,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/posts\/91823\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/media\/93188"}],"wp:attachment":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/media?parent=91823"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/categories?post=91823"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/tags?post=91823"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}