Hello all, I am currently deciding what to invest in next. I would like to increase my cashflow by about $5000 extra a month. However, I am unsure what to move into next. Have been looking into Commercial Retail shops, laundry mats, etc. but I am a bit unsure how much I could "purchase" with my current cashflow/down payment. I don't have much experience with anything outside of rental properties but i am very willing and open to go into a whole new direction.
What I own so far:
One Multi Family Building (4 Units)
Six Single Family Homes
The Multi Family Building and one of the SFR are owned free and clear (Estimated value of $2.3 Million combined). The rest have a combined worth of about 1.5 million but aren't owned free and clear yet.
All Properties are collecting rent and generate about $16,500 (profit) a month in Cash flow after mortgages/expenses. Currently have about $250,000 in cash for down payments.
Sounds like you have multiple options. Lower costs to generate more profit or continue to acquire properties. Interest Rates are going down and that will also help with any new investment or cash out refi and keep growing the number of doors. Buying another multifamily would complement the 6 SFH and round out your portfolio. Buying in the same market could help lower cost too. Seems like you have many options and making moves to get you closer to your goal is where you put your time and resources.
Congrats on a terrific portfolio. You could look into syndication, raising capital for the next deal.
You can also refi some of the equity out when rates drop.
You can also sell an asset to create equity to repurpose into the next asset. It comes down to your goals, what you like to invest in, and what assets you could see yourself owning for the future.
@Ronald M Padilla I’m seeing so many syndications that are in trouble right now that I wouldn’t recommend that platform.
Recently I saw some decent sized laundromats that were priced in the $600-$850,000 range. They had decent cash flow even with debt service. With $250,000 to put down you would be able to get into one of these quite easily.
The ones I was seeing were about 2 hours away from me and I became leery about trying to run a primarily cash business from that far away. I was concerned about the quarters becoming over loaded in between dates that I was able to visit the facility.
I’ve also thought about self storage and in many places in the country you can get into a facility for $250K. Or a little higher. These tend to have higher profit margins as compared to other real estate options and the land comes with the purchase unlike the laundromats I was looking at whose facilities were leased.
Congrats on the portfolio. it sounds like you are in a healthy position.
Most of the investors I work with like to keep some leverage on their properties. That way your tenant pays your mortgage. The vast majority are using their equity to increase their portfolio with small multi family. We are seeing great rates, Low 4% on the New Construction Quads that some of our builders are completing.
Either way your thoughts are solid buy for cashflow, but het in the way of obious appreciation.