70K cash to spend. What would you do? Go.

14 Replies

Simple question. If you had 70k sitting what real estate venture would you pursue and why?

SFR rental property. Depending on how I chose to pursue it I would get between 5-7 properties over the next 12-18 months. My reason being my current goal is to build cash flow to make myself "employment proof". It is also what I am currently focused on and have a positive track record with. Once I have more properties I will be switching to more notes and private lending, which I understand as well but have not yet done just due to my personal financial goals and situation.

Hey Patrick,

Lots of different directions you could go in, but this would be my thought process:

I would buy cash flowing investment properties and finance them using conventional 30 year fixed mortgages. So, if you have $70K and are putting 20% down, you can buy $350K worth of real estate. I would then buy cash flowing single family homes in middle class neighborhoods. I'd target properties in the range of $60K - $80K, would consider cities like Atlanta, Charlotte, St. Louis, Nashville, etc., and would try to find up and coming areas within those cities with low vacancy, low crime rates, and decent school districts. You should be able to afford at least 5 or so homes in that price range.

Plenty of other things you could do, but that's my 2 cents.

At the point I am with my investing I would be looking for a steal in the 50k range that needed less then 20k of work that I could sell for $99k+.

Medium 3Ian Hoover, Deacon Hoover Real Estate Advisors | [email protected] | 724‑492‑8312

Hi, @Patrick Yungck - I would confidently recommend the Atlanta market. It is steadily expanding. Depending on your area of interest within the perimeter, and with 70K at your disposal, there's no reason why you shouldn't see generous returns. Hope this helps.

Best,

Ryan Rutledge

Great to hear others thoughts and hopefully more to come Ryan Rutledge I really love the south and the growth potential, currently we are in the Greater St. Louis area and see a large upside in the works over the coming years. Areas such as Kirkwood, Mo and others are extremely hot right now and from our research will continue to grow. Our bread and butter is Commercial Properties (Retail and Multifamily), but in the near future would like to look outside of the Midwest for other investments.

Originally posted by @Matt Devincenzo :
SFR rental property. Depending on how I chose to pursue it I would get between 5-7 properties over the next 12-18 months. My reason being my current goal is to build cash flow to make myself "employment proof". It is also what I am currently focused on and have a positive track record with. Once I have more properties I will be switching to more notes and private lending, which I understand as well but have not yet done just due to my personal financial goals and situation.

Hi Matt,

I'm fairly new to the rental business. I've got 1 positive cash flow property, and $40k in cash. So, could you explain how you'd get 5-7 properties in the next 12-18 months in detail? I'd LOVE to be able to do that, but coming up with the 20% down payment seems to be my biggest issue. So, after I pick up 2-3 properties with my $40k (I found a nice rental market that would allow me to do that), what would be my next steps?

Thanks in advance!

For sure, @Patrick Yungck ! I would also advised being open minded to residential homes, specially single family homes. In my experience, the monopolization of these sorts of properties produce consistent and lucrative cash flow.

Ryan

@Patrick Yungck that's a loaded question man..... :-)

My favorite answer to most of life's pressing questions is, "It Depends".

What do you have the time or desire to do is the first thing you need to ask yourself before anyone else. If you want to park your money and get strong returns then buy a cash flow property in an area where you can get a great turnkey rental for that much or less. Get management in place and sit back and collect your checks. Done.

Do you want to be involved with shorter term investments? Start rehabbing, with that budget you may need additional funding from hard money or bank sources but you're probably not far off from where you need to be to get started on a project.

Are you an adrenaline junky? Start wholesaling with a fraction of that money but it will take a lot of effort to learn, implement and "do" that business. If you get with the right mentor you can be on your way to your first wholesale deal within 30-60 days easily.

You could scrap it all and just be a hard money lender too. Let someone else look high and low for the deals, bring them to you and you can fund their purchase and or rehab. Charge a hefty interest and points for the privilege of using your money and just make a living at that.

The list doesn't end there but it's enough to think about for one day isn't it?

I'll send you a private message with some more info about what we do but at the end of the day.... what is it YOU want to or have the time to do?

Have an amazing day!

Medium extremeMichael Kevorkian, Extreme Real Estate Investors | [email protected] | 847‑338‑6898 | http://extremerealestateinvestors.com

Patrick, I think this largely depends on your situation and your short and long term goals. Sure, can you buy some cash-flowing SFRs through conventional means and have a good return, yes. Depending on your liquid position, goals, and market. Ultimately, the long term goal for everyone it to be financially free. I'd speak with a good mortgage broker with investor experience about the amount of loans you can hold and your options. Speak with reputable sources in different markets about flipping and rental options.

With $70k available flipping SFRs with a good team you trust in whatever market you're in, with a solid funding source is a great idea, with the goal of adding a rental house to the portfolio in the midst of that to help mitigate capital gains. Talk to a CPA about this as I'm sure scenarios will differ.

Flipping houses via a hard money lender can find you anywhere from 50-120%+ ROI is very possible, and in the end ROI is ultimately what you're looking for, not necessarily a particular net gain monetarily. By keeping good PNLs and before/after photos you can take this experience to eventually find cheaper private lenders, or creating better relationships with the lender you started doing business with.

By flipping and mixing in rentals in good areas through more conventional lending (In better areas that aren't bogged down by foreclosures and short sales), I think you'd have a great starting point.

I'm absolutely sure there are members of BP that can help fill every aspect of the team you'd need to put together to be successful. The team helps relieve you of putting in too much of your own time, maximizing your return, and ultimately your success.

Good luck,

Medium newlogoManesh Hardeo, Networth Realty of Atlanta | [email protected] | 404‑987‑8644 | http://www.networthrealtyusa.com | GA Agent # 344112

I would suggest : buy-hold versus flip in Illinois

( sfr or duplex / tri-plex opportunities )

Jenkins Ramon, JMWPS Ventures, LLC | [email protected]

I think many of the answers above are great but would look at what Michael K wrote. Figure out what you want from your money.... short term gain or long term cash flow with buy and hold

Also, these are not necessarily mutually exclusive. I am currently ramping my long term buy and holds through rehabs. I.e. I buy from a motivated seller, fix up for appraisal, refit to conventional loan with little money in. I realize this didn't put any short term $ in my pocket but it did give me equity on my rental property that I can likely tap into one day.

Good luck!

Brian

CA Agent # 123456789

@Patrick Yungck

I suggest starting in your own back yard finding good deals/fixer uppers or already rehabbed and turning them into cashflow machines with great tenants for long term buy and holds. I started with $10k in Memphis to invest with, you should be just fine in Glen Carbon with $70k to invest with.

@Ben Durwood has the formula I used buy low fix up refinance and leverage the equity to buy and hold more cashflowing properties. I know Easy to say but Hard to do if you have never done it.

As Warren Buffet said "I will tell you how to become rich. Close the doors. Be fearful when others are greedy. Be greedy when others are fearful."

Good luck investing you will be just fine!!

Derrick

Medium new logo for bigger pockets..Derrick Craig, Memphis Buy and Hold | [email protected] | 901‑212‑4476 | http://www.memphisbuyandhold.com

Originally posted by @Patrick Yungck :
Simple question. If you had 70k sitting what real estate venture would you pursue and why?

Hi Patrick,

I would be purchasing run down distressed properties in the Midwest, rehabbing and flipping. The goal is to hold as many as possible.

I believe you could hold every 4th or 5th deal and still have enough cash to continue flipping.

You can find solid B class properties in the Midwest for around $25,000 - $30,000.

Thanks for reading and have a great day.

Medium list n sell logo designEngelo Rumora, List'n Sell Realty | [email protected] | 419 740 6999 | https://agentscomefirst.com/ | Podcast Guest on Show #89

@Patrick Yungck I would save the 70k and raise money to buy a large apt community with other people's money. Will have to use some of the 70k to put the deal together but then after I close on the property it will get all get paid back.

So, when the deal is done, I'll have the original 70k plus have ownership in a multimillion dollar multifamily property.

Medium logo1Joe Fairless, Best Real Estate Investing Advice Ever | http://www.apartmentsyndication.com | Podcast Guest on Show #227

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