Strategies for Investing in Real Estate

General Real Estate Investing
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Strategies for Investing in Real Estate

Taylor Dasch
Real Estate Agent · Temple, TX · Member since 2022 · 1k+ posts · 700 votes

Hey guys, I just wanted to post this on here and see what yall thought. I have been thinking about my strategy for investing and realize I need to change it, so pretty much right now I do dollar cost averaging in real estate lol, so I am not concerned with timing of the market, when I get the funds to buy, I buy ( and sometimes I buy even when I dont have the funds). This is all good but I dont believe it is the fastest way to grow my portfolio. 

Some strategies that I am considering are: 

Flip with HML then buy at auction - build capital to around 100k, then buy at Pre-foreclosure/tax auctions and flip the house for a larger profit and less work. The risks are obviously placing a big bet on a PF home and then taking a loss on the money I had acquired to begin with but with the higher risk, the reward to me seems like it would be greater as well. The plan would be to do about 10-15 flips within the next 3 years with the end goal being to purchase a larger MFH for cash flow and leverage the $ that I saved from the flips with either the one MFH or multiple properties. Has anyone done this?


Hybrid: Flip two properties then buy and hold one - this one would be more rewarding in the short term in my opinion because at least I would see my portfolio build which is my end goal anyways, but I know that I would have at least 25% equity tied up in the property that could be going towards the big push in the other strategy. 

Continue to just buy and hold - Less risk and I am pretty sure I can reach my goals within 5 years, I just feel like that is not the most efficient way to do this. 

Do yall have any thoughts on this or is there anything I am not thinking about? 

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  • Caleb Brown
    Real Estate Agent · Kansas City · Member since 2018 · 4k+ posts · 3k+ votes
    2y

    Seems to be your current process is working so it'd be a gamble to switch it up. Flips are a whole different beast. You can do very well but make sure you have all the ducks in row. They aren't super easy. I'd start with a simple flip off the MLS or through a wholesaler to get a feel

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  • Taylor Dasch
    OP
    Real Estate Agent · Temple, TX · Member since 2022 · 1k+ posts · 700 votes
    2y

    Yeah that makes sense, I have dabbled in a few flips. 

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  • David M.
    Morris County, NJ · Member since 2020 · 5k+ posts · 2k+ votes
    2y

    @Taylor Dasch

    Sounds like "are you feeling lucky?"  Flipping certainly can be profitable, but there are risks.  Buying at auctions have increased risk.  Risk and reward, huh?  What about if, or when, a deal goes bad?  Then what?  Depending on how bad, can you recover?  "active investing" means being able to absorb the "hit."  Hey, its great if every deal you do go splendidly, but I don't know many investors who've had that experience.  I keep saying this now, but I've known many who have lost money doing these deals.  I've lost money --- I've just had more good deals than bad deals.

    Yeah, its tough to plan out the future.  Who knows what it will hold.  There can  always be that "itch" to go for a little more.  That's up to you, and up to you to accept whatever may happen.

    Maybe you have the right idea...  Keep looking at more strategies at growing your wealth.  There are other ways to invest in real estate.  There are other areas to invest...  If you don't think this one is working, maybe there is a better way for YOU.

    Hope this helps.  Happy to chat.  Good luck.

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  • Taylor Dasch
    OP
    Real Estate Agent · Temple, TX · Member since 2022 · 1k+ posts · 700 votes
    2y
    Quote from @David M.:

    @Taylor Dasch

    Sounds like "are you feeling lucky?"  Flipping certainly can be profitable, but there are risks.  Buying at auctions have increased risk.  Risk and reward, huh?  What about if, or when, a deal goes bad?  Then what?  Depending on how bad, can you recover?  "active investing" means being able to absorb the "hit."  Hey, its great if every deal you do go splendidly, but I don't know many investors who've had that experience.  I keep saying this now, but I've known many who have lost money doing these deals.  I've lost money --- I've just had more good deals than bad deals.

    Yeah, its tough to plan out the future.  Who knows what it will hold.  There can  always be that "itch" to go for a little more.  That's up to you, and up to you to accept whatever may happen.

    Maybe you have the right idea...  Keep looking at more strategies at growing your wealth.  There are other ways to invest in real estate.  There are other areas to invest...  If you don't think this one is working, maybe there is a better way for YOU.

    Hope this helps.  Happy to chat.  Good luck.


     This is a great way to look at it. I have had some deals go bad as well. I think the knowledge of the specific market reduces risk but also deal flow. Just trying to come up with some ways to build capital - one of the lessons I learned was doing way too much too fast and not having the reserves to support it. Which is the reason for even thinking about flips, but it is definitely more risk and could 100% end up in a loss with the wrong deals. 

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