Contractor · Round Rock, TX · Member since 2013 · 767 posts · 389 votes
10y
I think the question is what is the cash? Is it yours in the bank? Is somebody going to lend it to you? What is the source of it? I'd pay off any debt you have. If you are planning on living in your area for the forseeable future. Buy a house to live in.
Investor · Fort Walton Beach, FL · Member since 2015 · 568 posts · 966 votes
10y
1. Constantly look for a house that has great re-sell potential or a multifamily where I can rent out the other units to use my owner occupied loan on. This way you can put a low downpayment and preserve most of your capital.
2. Constantly look for either rental property that meet my specified criteria (xx% cash on cash return) or a property that could be renovated and resold at a profit (flip).
3. Continue saving income, repeat #1 and #2 and increase net worth
4. Join your local REIA and network network network
Investor · Austin, TX · Member since 2013 · 933 posts · 1k+ votes
10y
Hi Chris
Education is key and understanding your strategy is important. Do you want cash flow? Most investors like buy n hold cash flow opportunities especially those nearing retirement. Being in your 20s, you may want more appreciation opportunities and shorter time horizons like fix n flips. If the 150k is burning a hole in your pocket and you need to put it to work, I have some ideas for you in new, multi family housing w property mgt in place. I'm from Scotsdale, went to Chaparral HS, now live in Austin, but finding still good value, cash flow and ROI in nearby San Antonio. PM me or call me to chat. With 140K and assume u have a W2 and can qualify for loan can get u into high demand, hands off 4plex that cash flows very well.
Lender · Knoxville, TN · Member since 2015 · 61 posts · 16 votes
10y
A family member has pledged me the money once I develop a plan and present it to him.
From my perspective the best course of action would be to leave my current apartment and invest in a 2-4 unit multiplex with an FHA loan. The problem is finding one in an area I want to live in (scottsdale). There are a few in south west Scottsdale at decent prices but they are sketchy IMO. I started contacting wholesalers today to get on their list and hopefully find something off market.
The opportunity cost of getting out of my current rent ($2100/month) is ENORMOUS! Also, it will allow me to get Landlord experience for two years so I can qualify for better loans on multifamily.
Once that's complete, I will have capital reserves to invest in SFR, Fix & Flip, or more multi. My long-term vision is a portfolio of income producing properties. I will need liquidity in the short-term = fix & flips.
That all sounds great in theory but the knowledge of the markets, where to find properties, estimating repairs, capex, etc... is just not there. That's what I feel I need and after doing some more research on this forum I feel my best course of action would find a badass in the Scottsdale market and be his/her b**** boy for a year and learn the process.
Contractor · Round Rock, TX · Member since 2013 · 767 posts · 389 votes
10y
What are the strings attached to the money? I'm guessing since you're unemployed to get you off your butt. How are you paying your $2100 a month rent with no job? You state in your first post no family, but now you have family to give you $150K? My honest suggestion would be to get a job and some discipline in your life. There is absolutely zero reason not to have a job in your mid 20s. Otherwise, this $150K will be pissed away and you'll be back to square one and owing your family some serious money.
Lender · Knoxville, TN · Member since 2015 · 61 posts · 16 votes
10y
No strings attached I graduated college three weeks ago with the plan to go into real estate. I'm not lazy and I don't "sit on my ***". I'm not on "daddy's bill" if that's what your implying.
Investor · Lebanon, OH · Member since 2015 · 80 posts · 26 votes
10y
Brian Mathews
Wow...I see a lot of ignorant things online, from people that seem to think they are better than others and/or think they know everything. But this one takes the cake.
Did you bother to read his profile? Clearly you didn't or you would have seen that he is getting ready to graduate college. Instead you assume he is lazy, sitting on his *** and doing nothing with his life? You question how he first said he had no family then said a family member would willing to give him the money to start investing? My guess is he was referring to not having a family of his own (aka wife, children). Not to say he doesn't have a mother, father, grandparents, aunt, uncle...
OP - can't even remember your name at this point because I am so annoyed - keep doing what you are doing - you will find success. Good luck!
Wow...I see a lot of ignorant things online, from people that seem to think they are better than others and/or think they know everything. But this one takes the cake.
Did you bother to read his profile? Clearly you didn't or you would have seen that he is getting ready to graduate college. Instead you assume he is lazy, sitting on his *** and doing nothing with his life? You question how he first said he had no family then said a family member would willing to give him the money to start investing? My guess is he was referring to not having a family of his own (aka wife, children). Not to say he doesn't have a mother, father, grandparents, aunt, uncle...
OP - can't even remember your name at this point because I am so annoyed - keep doing what you are doing - you will find success. Good luck!
Its not ignorant at all. He's out of college with no job and a $2100 rent? Why are you out of college for 3 months with out a job? Whose paying the rent? Obviously, he's not with no job. Why are you living in a $2100 a month place with no job? Why would you subject whoever is paying that to such a high rent? I know some places are high priced rent, but not sure Phoenix is one of those places.
Investor · Phoenix, AZ · Member since 2014 · 10 posts · 6 votes
10y
I do a lot of investing in the Scottsdale area, I just sold one property off of Hayden and Roosevelt and another property just went up for sale near the Hayden and Indian School area. You have a lot of options in Scottsdale, it just depends on what you are looking to do. Feel free to send me a message if you would like to discuss it further.
Real Estate Investor · Mobile, AL · Member since 2016 · 41 posts · 10 votes
10y
Ive learned over the past that you can never really ask someone what they would do. You're going to get so many answers and opportunities which leaves with even more regret if you don't choose one you feel comfortable with.
I've been in a similar situation. I turned 19 and received a large lump sum of money. Trusted a lot of people. Made a lot of mistakes. Lost a lot of money but I'm on my climb back up.
Write down your goal.
Write down every scenario or opportunity in detail.
For me, the best cash flow I've done and the least risky is section 8 housing. It is directly deposited into your account each month and you receive a W2 every year. More cash flow you have, the more borrowing power you can get from a bank.
I'll give you an example of a deal I did just a few months ago. I paid 23,800 for a 3/2 and I had to put $9,000 in the house. It's now worth over $69,000 and i received a voucher for $1700, but the voucher was for a 7-8 BR. I'm thinking I will get about $1200+ a month.
Be patient when looking for houses. Pay cash. Put them in an LLC. Once you have them all rented out, borrow against them to buy more on a cash out refinance with good terms and a good rate.
Right now I have a 20 yr term at 5% w a 7 year balloon. I'm good with the terms.
I've written a realistic scenario down of where I'll be in five years and I'm sticking to it. Month for month. I'm actually ahead of schedule.
Just be patient and don't blow through your money. It's easy to do. Becareful who you trust
San Antonio, TX · Member since 2013 · 65 posts · 13 votes
10y
Study your market, go inside open houses, especially those that have been rehabbed. Stay within a small area at first, This way you'll have a better idea of what houses sell for.
all I can Say is... do not go and invest blind folded. Start going to REA meetups, talk to wholesalers, talk to flippers. Once you think you have a good deal make sure you talk to an experienced realtor for a true CMA, not your or the wholesaler's best guess on the house value. Don't go by the wholesaler's estimated rehab cost, he might be well intentioned, but do your own numbers and double check the property for anything he might have "unintentionally" left out. Over estimate your rehab costs, and under estimate your ARV.
Investor · Phoenix, AZ · Member since 2013 · 37 posts · 10 votes
10y
Stick it in the stock market, S&P500 fund or ETF. Let it sit there all of 2016 and by the end of the year it will probably be closer to $180k. So ten you will have $180k to invest in RE. The market is nearing a bottom n a buying opportunity is getting close to presenting itself.
Specialist · San Antonio, TX · Member since 2015 · 909 posts · 297 votes
10y
educate yourself on all the possible strategies REI gives you, designate time to this, and your world will start to open to everything you can do here, believe me its a lot, look at notes, land, tax deeds, out of area turn key rentals with fannie mae loans,
Investor · Columbus, OH · Member since 2015 · 70 posts · 30 votes
10y
Originally posted by @Account Closed:
Stick it in the stock market, S&P500 fund or ETF. Let it sit there all of 2016 and by the end of the year it will probably be closer to $180k. So ten you will have $180k to invest in RE. The market is nearing a bottom n a buying opportunity is getting close to presenting itself.
Seth, that's dangerous advice. No one can predict the bottom in the stock market. And no one can predict it's performance over the next year. If you could with such certainty, you can invest in some call options and become a multimillionaire.
Stick it in the stock market, S&P500 fund or ETF. Let it sit there all of 2016 and by the end of the year it will probably be closer to $180k. So ten you will have $180k to invest in RE. The market is nearing a bottom n a buying opportunity is getting close to presenting itself.
Seth, that's dangerous advice. No one can predict the bottom in the stock market. And no one can predict it's performance over the next year. If you could with such certainty, you can invest in some call options and become a multimillionaire.
I couldn't agree more. Stock market investing is pure speculation...with a rationalization that it isn't, pure speculation.
Real Estate Investing can be, if you invest for appreciation, and other future events that you have no control over, but there are an incredible number of entrance and exit strategies you can use for REI...there are very few for the Stock Market, and the Stock Market is where your spend money to get in...you don't have to spend a dime to invest in RE.
Real Estate Coach · Venice Beach, CA · Member since 2012 · 6k+ posts · 3k+ votes
10y
Lol! I love the set up.
Well normally I'd give you ideas on how to maximize your returns on some killer rental properties with that $150k, but if you are unemployed I have to stick with the advice of--keep that money to live off of until you get another job! :)
Like the idea, but do you have a bit more specifics? Invest in SFH? If so, what price range? Multi-family? I'm looking in that area as we speak, and I see a ton of opportunity.
Like the idea, but do you have a bit more specifics? Invest in SFH? If so, what price range? Multi-family? I'm looking in that area as we speak, and I see a ton of opportunity.
I'm torn between two ways to answer your question on specifics. So I'll give you both.
A1: It's a combination of SF flips, wholesaling, lease options and buy & holds...all strategically executed, with the decision of which strategy to use, based on the needs as to how they fit in the specific point/timeline in the overall investment plan that was reverse engineered from where you need to end up financially, to where you are right now financially. Can I breath now?
Investor · Phoenix, AZ · Member since 2013 · 37 posts · 10 votes
10y
@Sergei D. I grew up in Bayville,NY.
It's not pure speculation. It's text book and history. The stock market over time does beat RE. I do both n realized RE's only advantage is the leverage that doesn't get called. Stock market leverage can get called. I made some good money on a few of my homes. I doubled my value on one home over the past 4 years. The RE bubble n bust was a once in 100 year event which we will probably never see again. Congrats to whomever picked up RE during that event.
In 12 months from now let's revisit this conversation on the stock market. Today it's below 1900 S&P500.
Investor · Phoenix, AZ · Member since 2013 · 37 posts · 10 votes
9y
Bammmmmm! Told you to stick it in the market last year near the bottom. That 150 would be over 200k today probably like 210 today 14 months later! Bammmmmmm!
That was a huge buying opportunity in February 2016. Loved it!