Only $70k to Invest. Creative Strategies:

[Kevin Forsell]

Hey everyone!

I have no experience, but I've been learning and researching REI for years. Several circumstances have left me without any capital to invest myself, however I have a friend who wants to passively invest $50-70k into real estate (Flips and/or STRs) and is trusting me to invest as a partner.

Of course, 70k is not a lot for a property in north Jersey. I've researched several ways to make the 70k stretch: Owner-occupant loans won't work because my partner doesn't want to "lend me" the down payment- we're creating an LLC for the most protection. I've looked into DSCR loans for a turnkey STR. I've contacted two DSCR underwriters who approved me for 7.12% interest and 20% down. This would give us a max purchase price of ~$300,000. Our STR market is Hudson Valley NY, which does have properties for 300k, but pickings are slim for a turnkey at that price, especially if we take into considerations furnishing and marketing costs etc.

Are we stuck with the out of state option (unless we find another investor, which we'd like to keep as a last resort)? We could make our 70k go much further in a cheaper market, but as my first flip, I'd prefer to keep it local. We're also looking into the Trenton and Newark markets which seem a bit easier, but still tight. 

Let me know what you all think!

Kevin