New to Real Estate · Melbourne, FL · Member since 2021 · 33 posts · 14 votes
Hey BP community!
I have a question regarding investing capital in one property vs in multiple and am interested in learning what the community's perspective is on the topic. What I would like to know is what things should be considered when investing the majority of your capital in the purchase of a single rental property vs in the purchase of multiple rental properties? For example, if you had $100,000 in capital at your disposal, would it be more wise to use that capital to purchase a single rental property for $100,000, or would it potentially be a smarter decision to take that $100k and use it as a down payment for multiple rental properties (e.g. 20% down payment for five rental properties that each cost $100k)?
Rental Property Investor · Des Moines, IA · Member since 2020 · 232 posts · 116 votes
5y
@Shawn S. This really depends on your end goal. Are you one and done, or is the goal a large units of units? If the goal is one unit, then buy one unit for $100k cash, and you're all done. Verse going the big route, and then what I would do, is buy for $60k, put in $10-15k for rehab, ARV is $100k, and refi for $70-75k and repeat. And just keep turning that money until you reach your big goal.
Good point -- I failed to mention that my goal is to eventually have enough rental income to pay my bills so that I no longer need to have a full-time job.
The 'big route' you describe sounds similar to the BRRRR strategy. Is that correct?