Using Cash efficiently - Outright buy with cash or use loans

1 Reply

Hello All, I currently have a good job with very little expenses. I’ve saved about 50k and ready to invest into real estate. Was thinking about taking the follow paths but unsure what to chose. 1. Use the whole 50k and outright buy a cheap property in upstate NY or NJ and rent it out to tenants. I will use a property manager to manage this since I live in the NYC. Continue to save the same amount (may take 1-2 years) and repeat. 2. Invest in more expensive properties by putting 20% down on 2 100-150k homes. This is my first real estate deal, not sure what any of the pro/cons are of each. Hoping to learn from people who took one or both of these routes Thanks, Mo

Well without question, your returns are higher when you leverage.

Also to consider...if you are buying $50k properties, please have your eyes wide open and expect to deal with the problems that come with those properties.  Tenant base for that price point is going to be a high risk tenant base.