I wanted to know how you would invest 100k, 200k, or 300k, cash depending on your market. It does not have to be real estate but I am assuming most of you would choose real estate. It may be a house or some other type of business but I have chosen condos since they need almost no maintenance. Assuming one of these numbers match what you need to purchase a home, condo, or other business in your area, what type of monthly return would you expect from your cash only invest?
This is assuming you do NOT take loans. I see a lot of numbers on here on ROI's all with loan interest rates considered but let's assume you have not, can not, and will not get a loan, even if you could.
I would expect a minimum return on my cash of 10% plus a monthly positive cash flow from the property.
On a property purchased for 100K, after all expenses I need $833/month return on my cash plus a bare minimum $100/door per month from the property. In the real world these numbers are virtually impossible which is why buying all cash is not a realistic investment plan. If you want to make money you must leverage with OPM.
Cash buyers, except those forced to pay cash for under 50K properties, are the most conservative of investors and therefor realise the lowest ROI in the industry.
You would be farther ahead to invest in moderately aggressive/agressive income funds than to buy real estate with all cash.
So basically you'd want your original investment back in 10 years.
It isn't really an investing strategy, but a place to park your money safely with a decent return. I mentioned condos because you can park your cash in it and your biggest headache would be a broken appliance every few years at worst.
@Account Closed I can get a property off the MLS for $50K (after repairs) and rent it out for $800 pretty easily in a C area. 19% on the gross 13% on the net.
Without taking out a loan I couldn't enough ROI to make a RE ourchase worthwhile.
In my professional opinion, I would never purchase assets in all cash unless there is a strong reason why. If the rich do not use this method, why would you? Your portfolio would be exponentially larger if you leveraged. Why pay cash for 2 buildings when you can spread your funds across 5 or 6? It's all a numbers game and wealth is built around having the ability to maximize your dollars.
Again just my two cents.
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