Put it on Red 32 and hope for the best. Just kidding.
I'd put it in single family housing in Phoenix, but hey, what do I know? I'm just another (very successful) investor. But I don't have a clue what your goals are.
Personally, assuming all $300k is not needed right now, I'd put it all down on rental properties. That should get you about $1.5 million worth of properties (not including closing fees).
Having $1.5 million in rentals with a market appreciation averaging 4% annual gains means in 5 years, your $1.5 million in properties would be worth $1.825 million. Just like that, your net worth increased $325k + the renters paying down the mortgage increased your equity by another $150k or so.
If you can make 20% ROI, that's $60k/yr in cash flow for you x 5 years = $300k + $475k in equity gain = $775k
Essentially, this scenario means you'd turn $300k into $1,075,000 in 5 years.
@Timothy Hero It's that easy? All you have to do is find a dozen or so turnkey properties that will cash flow at 20% ROI and will appreciate 4% annually for five years? Sign me up! :-)
@Timothy Hero It's that easy? All you have to do is find a dozen or so turnkey properties that will cash flow at 20% ROI and will appreciate 4% annually for five years? Sign me up! :-)
Ahaha, oh I wish.
Did I leave out taxes, property maintenance and tenant issues?
I would find a market, build your core team, and buy a cash-flowing single family home for < $100K. You could BRRRR but it takes times more time and effort. The turnkey idea mentioned above is the easier route but the return will be less. I'd take $100K and give it to financial planner; think mutual funds, bonds, and lower risk stocks. I'd keep the remaining $100K for reserves/emergency fund, FUN MONEY, donations, and put the rest in a CD.
If $300,000 cash fell down from the heaven's and landed in my lap, I would buy up as many single family rental properties I could with at least 30% equity after I rehab them. I would then BRRRR these rental properties to pull back out the 300k and then....do it again! Using this method you should be able to continuously invest that same 300k into rentals over and over, building your portfolio and providing tons of affordable housing. Easier said than done. The only problem? Finding the deals! (And keeping your numbers accurate and your rehabs running smooth) Another route to utilizing this 300k would be to spend a weekend in Vegas playing blackjack and buying Mai Tais...but those days are behind me!
I agree with @Account Closed comment I know what I would do with it but if our goals are not the same it doesn't matter. In my opinion your #1 goal should be financial freedom. That means using passive income strategies. Turnkey Single Family rentals is the easiest to get into and these properties cashflow from day one. If you have interests, skills, resources in other areas such as commercial, storage, medical, senior homes, etc. That may be another good niche for you. Keep it simple and passive. Once you achieve financial freedom you will have more time to dedicate to your life and business.
Buy a multi-unit in South Los Angeles. Competition is fierce though... if a good one that cash flows appears in the market, it almost always goes above list price. I put in an offer for a duplex listed for 619K a few days ago. I felt good about my chances because my offer was well above list price. Then I find out that it went into escrow yesterday for $670K..seller didn't even bother with a multi-counter offer. We're talking South LA....you know, the area made famous by movies like Boyz in the Hood. The area is obviously changing rapidly.
I figured given not having a big portfolio of properties I wouldn’t qualify or get a larger apartment building deal. Maybe it’s possible after all? Right market, property, timing and connections are presumed.
First goal: financial freedom for my family via income properties replacing my wife and my incomes/250k within 10 years, but ok if of takes 20, I’m 34. But then the bigger and more important goal is to grow to much more than that over time so I can GIVE considerably to charities, start ups (especially social cause ones) and self fund my own creative ideas/imagination within healthy limits/hence having our incomes being replaced first. Then teaching my kids and nephews about the business so they have a solid foundation to begin their careers/to learn principles of finance and RE.
Thanks for sharing! Yea, I’m thinking of diversifying beyond RE, keeping solid emergency fund and keeping our own expenses low, then save as much as we can (leaving Los Angeles for Columbus, Ohio and looking forward to less chaos and stress so we can focus on our family and learning about RE and building wealth over time)
But then also keeping x amount for investment properties. I like the idea of paying cash for one or two properties in the 50k range and growing from there. Or put it all down on a larger multi family, maybe with some partners. Still exploring options and gleaning from other people’s wisdom :-)
A modification/addition to the BRRR method I'm considering are ADU's/Accessory Dwelling Units. States like Washington have had them for a while and california just since 2016, but basically all single family homes can become 2 unit properties. So same strategy but buy, then build/add ADU, rent/hold or sell after appreciation picks up. In LA now a certified tiny house can count as an ADU/legal rental. Those might cost 50k and rent for 1500-2000 depending on the neighborhood.