How would you invest $250k to Scale/Grow

18 Replies

Hey BP!

If you had access to 250k cash - How would you invest it. This 250k is cash no interest. What would you do to quickly grow and scale this money? Next, who would be silly enough to lend that money free and clear but what if?

Would you BRRRR? It seems like a great strategy. Lots of steps where the process could go wrong - But the juice could be worth the squeeze.

Would you look to invest in turn key single family homes? Condo's? Townhomes?

Would you look into Duplex/Triplex's?

Would you look into a higher price point, with potential for appreciation, and potential better tenants. Or be able to buy twice as many at a lower price point with similar cash flow?

How would you look to scale the business to be able to grow exponentially? I see 250k investments that would yield a 300-350/mo cashflow - But is a 45k down payment the right way? 

What does everyone think? I see lots of posts regarding these individually but collectively what is a good general concensus?

@Christopher Bell

Too many unknowns about your goals imo. To get a better response here, I'd secure the funds then repost the question so it's not a "what-if" scenario.

@Christopher Bell I'm a newb here but I've asked myself that question as well since if I were to sell my current home I'd net just over 200k after sales expenses.

Since I'm not ready to move yet I've been in contact with lenders about refinance/HELOC options to access the cash.

If I was to have that cash though I'd imagine myself doing a few BRRR's with some SFH's, maybe in a cheaper area. Then once I get that experience move to MF's.

@Luis Vaca

Thanks for the reply! That’s the direction I was initially leaning was work on renovating a few properties and building a portfolio that way. However, I thought is that the best way? Sure they would cash flow a bit but would be a if a 6-8 month seasoning. Or is it better to get the instant cash flow by buying a turnkey rental that would cash flow right away. Or, just dive into multi-family properties.

Some of my question is directed to some of the seasoned guys on here asking - if they went back to day 1....what would they do to scale quickly

@Christopher Bell

There's no "one size fits all" solution. A lot depends on your commitment, desire to succeed, education, personal "Why", etc... It will also not going to happen overnight. Lastly, anything where the work has been done by someone else, will shed some $$ off your return (you mentioned TK's above). 

Hence in order to get the highest ROI, you need to start from scratch and do all the work yourself (including building a team that will help you achieve your goals). As others mentioned, MFH investing is one of the better strategies out there that many have implemented when they wanted to scale (but again it's not overnight!)

The steps to take:

1) Determine if you have at least 15 hours a week or more

2) Educate yourself on MFH investing (or whatever other niche you chose)

3) While getting educated, build a team of professionals that will be assisting you (Ex, attorney, inspector, loan officer, etc...) 

4) Take action!

@Brandon Sturgill

You used MF. I am newbie to commercial real estate. When I was talking to a buyer side MF agent in my state Virgina, he was telling an example case that $250,000 buys tiny small apartment buildings and that too in war zones.

I am disappointed with his discussion.

Is that true nothing meaningful commercial MF property can be purchased for $250K? I know VA and DC are too hot now. I do not know how to start if this were true.

Thanks

J

Originally posted by @Alina Trigub :

@Christopher Bell

There's no "one size fits all" solution. A lot depends on your commitment, desire to succeed, education, personal "Why", etc... It will also not going to happen overnight. Lastly, anything where the work has been done by someone else, will shed some $$ off your return (you mentioned TK's above). 

Hence in order to get the highest ROI, you need to start from scratch and do all the work yourself (including building a team that will help you achieve your goals). As others mentioned, MFH investing is one of the better strategies out there that many have implemented when they wanted to scale (but again it's not overnight!)

The steps to take:

1) Determine if you have at least 15 hours a week or more

2) Educate yourself on MFH investing (or whatever other niche you chose)

3) While getting educated, build a team of professionals that will be assisting you (Ex, attorney, inspector, loan officer, etc...) 

4) Take action!

Alina, Thank you for the response! The commitment, desire, and dedication to succeed are great examples of how I would absolutely describe myself. This has been a dream/passion of mine to create a large enough portfolio that could create wealth 24 hours a day. To answer the "why" it's to become my own boss doing what I love and building a team to keep the freight train growing exponentially. I do have the 15 hours a week to spend dedicated to RE.

Do you have any suggestions on books/podcasts to learn about MFH investing?

Originally posted by @Jagan Reddy :

@Brandon Sturgill

You used MF. I am newbie to commercial real estate. When I was talking to a buyer side MF agent in my state Virgina, he was telling an example case that $250,000 buys tiny small apartment buildings and that too in war zones.

I am disappointed with his discussion.

Is that true nothing meaningful commercial MF property can be purchased for $250K? I know VA and DC are too hot now. I do not know how to start if this were true.

Thanks

J

Jagan, Thanks for the reply! I'm not far from Sterling. I'm there a lot for work. I know that NOVA/DC Metro market is extremely hot! I'd love to try and find something in that area! I agree with that person with a 250k place in a warzone not being a good investment. It appears that some here suggest a BRRRR type strategy to building the wealth. I'm not against that - and believe it could work. Just don't know if some who have started where I stand would have said I would buy more doors quicker. Or if some would say don't waste your time with smaller $ investments. Buy higher value investments

Christopher, 
Great to hear you're ready to take it to the next level.
In terms of the books and podcasts, I have tons of recommendations. Start with the two of David Lindahl's books and Steve Berges on buying and selling apartments. 
As for podcasts, look for the ones hosted by these folks:
1) Jake&Gino
2) Michael Blank
3) Rod Khleif
4) Joe Fearless 
5) John Casmon

There's plenty more, but these will give you a good head start. 

Originally posted by @Christopher Bell :
Originally posted by @Alina Trigub:

@Christopher Bell

There's no "one size fits all" solution. A lot depends on your commitment, desire to succeed, education, personal "Why", etc... It will also not going to happen overnight. Lastly, anything where the work has been done by someone else, will shed some $$ off your return (you mentioned TK's above). 

Hence in order to get the highest ROI, you need to start from scratch and do all the work yourself (including building a team that will help you achieve your goals). As others mentioned, MFH investing is one of the better strategies out there that many have implemented when they wanted to scale (but again it's not overnight!)

The steps to take:

1) Determine if you have at least 15 hours a week or more

2) Educate yourself on MFH investing (or whatever other niche you chose)

3) While getting educated, build a team of professionals that will be assisting you (Ex, attorney, inspector, loan officer, etc...) 

4) Take action!

Alina, Thank you for the response! The commitment, desire, and dedication to succeed are great examples of how I would absolutely describe myself. This has been a dream/passion of mine to create a large enough portfolio that could create wealth 24 hours a day. To answer the "why" it's to become my own boss doing what I love and building a team to keep the freight train growing exponentially. I do have the 15 hours a week to spend dedicated to RE.

Do you have any suggestions on books/podcasts to learn about MFH investing?

@Jagan Reddy

Id get a good easy analysis calculator and start plugging in properties from sfh to whatever apartment building you can purchase for that money.

Imo you can stretch that money out to maybe 4 quadplexes with fixed rated mortgages 25% down. Buying good deals with built in equity, raise rents. Its hard to tell you whats best way since I dont know your market but imo any 50k dead appreciation properties or sfh’s that rent for less than 1-1.2% of purchase price are immediate no go’s. Good luck.