I currently own a small 3 unit mf. However for about 2 years ive been stacking and reinvesting every dollar in lending money on 2 different deals for a builder. These deals provide me a return of 20% every 4-5 months. And 15% every quarter give or take a few days.

My startegies and goals are in buy in hold MF in the long run. I want to stack, multiply and grow; however the cash returns im making are tough to pass up on. Suggestions? Input? Should i wait for certain markets to drop more, and than go shopping???

Ps. Im new to creating posts here so i hope i picked the correct subject and categories here within the forum

@Fernando Lama so 15-20% annualized returns on the private lending? Are you thinking buy/hold small MF (2-4 units) or larger commercial MF buildings (5+)? Either way it definitely helps to have a stockpile of cash, as the saying goes "cash is king." From what I've gathered, it seems that most investors start small and build up to larger properties. One of the best options imo if one has plenty of capital is to invest with top level syndicators in large apartment buildings. I also spoke to an older gentleman recently who has owned lots of property. He told me (with a big smile and a twinkle in his eye) that his favorite investment type was NNN commercial property because he doesn't do anything except collect the check every month from the mailbox. I'm sure @Joel Owens can appreciate that. 😉

Greetings @Fernando Lama !

Am I reading this right? You get a 20% return every 4-5 months? So about a 60% annualized return?? I’d stick with that until that well runs dry!

And let me know if that builder needs anyone else to lend to him!!

Cheers!

Eric

@Brian Gerlach thanks for the feedback. Cash is King absolutely. i ll keep building my capital. the little that i know, NNN basically is where the commercial tenant laterally covers all expenses and the owner just collects? sounds fantastic. Haha

@Eric Chase thanks for the advice brother. Figured you would tell me that. Haha. i m going to focus entirely on building my capital up. I wont hesitate to let u know about investing future funds. Let me see what i hear. Thanks again Eric.

I wish I had your problem.... I'd definitely continue lending with an annualized return of ~50%... But I'd not put all my eggs in the same basket and put a portion of the profit as a down-payment on a multifamily. It's a long term investment that will still return for many more years and that will add to your experience and portfolio... Factoring cash on cash return, property appreciation, tax advantage from depreciation and the mortgage paid off by the tenants, makes it maybe not as profitable as 50% annualized but not too far off from it either.(depending on the property). The risk level is I would say comparable... Or is it? What happens if your builder files for bankruptcy? That could eat up all the profit you've made in one blow if the loan is unsecured...