If I had a million dollars...

8 Replies

If you had a million dollars, how would you invest in real estate for ongoing cashflow, diversified portfolio, low-risk, longterm play with minimal hassle? Would you ever consider buying 10 $100,000 SFH's outright? Finance 50 $100,000 homes? Buy an apartment building? Invest in REIT's and crowdsharing funds?

$1M gets me all cash in an 10 CAP NNN. That's $100k/year clear, no fuss, no babysitting. In 10 years I get all my money in back...or,

$1M gets me $4M in NNN at 9 CAP with 25% down. That would be clearing about $130k/year, no fuss, no babysitting. In 8 years I get all my cash back...or,

$1M gets lets me loan it out at 10% simple interest for 20 years with a balloon at the end. Result: In 20 years I triple my money, with $100k/year in cash flow over those 20 years, and at the end of every 2 years, I have a new $200k to invest as a DP on a new NNN property.

NNN leases are usually commercial properties that have 20-25 year guaranteed leases, that the tenant (franchise) pays for everything except you buying the building. No muss, no fuss.

Probably the lowest risk REI you can have. No management needed since the tenant is responsible for everything. Returns range from interestingly high to laughable low.

Like every other REI, you have to analyze it to pick out the good from the bad.

I'd buy 4 vacation rental.  Ez net of 1% a month.

The only genre that pencils out today. 

Good for those who wouldn't know what a 🔨 is used for. 

Last thing I would do is syndication. If the main dude is good he probably will offer low return. 

High return mean operator sucks. 

@Thomas L. I'd diversify into multiple investments. Consider and evaluate the strategies mentioned by @Caleb Heimsoth  and @Joe Villeneuve . While reviewing it keep in mind/discuss with your tax accountant as you'd probably want to keep your taxes to  minimum. Hence avoid earning ordinary income! 

In terms of the syndications, they are completely passive. You need to do your homework upfront and evaluate the syndicator, and their deal. After that you relax and let the investment work for you. You get the tax benefits through depreciation. You can get more details from your tax accountant on that. 

With notes, you can consider investing a notes fund which is also going to be very passive. 

If you'd like more details on syndications, feel free to PM me.

Best of luck!