Three Cash Flow properties, looking for next deal
Hi guys! This is my first post after years of learning from this website. I currently have three cashflow properties in Socal and am looking for my next deal. Which of the three would you vote for and which would be the most viable? Assuming I have $180k cash at my disposal and the rest would have to be financed.
1. Build a 4 plex
2. Look for an Airbnb single family house
3. Buy an existing duplex
THANK YOU!
David
Most Popular Reply
@David Suzuki Congrats on the properties you have, great price entry point with great cash flow. Palm Springs has a really wide range of property types/values, are you thinking SFR's or condo's again? I am going to suggest that you look at PS very closely. It sounds like you want to shift your business strategy away from straight buy and hold to (BH + ABnB), if that is the case then I suggest you create a separate business plan specific to the short term rental market in PS. Are you going to self manage the PS property? You are probably close enough that you could on your first few units. But building a business plan, specific to this market and strategy is important. You are basically adding an additional layer of complexity to your existing business model. Take a look to see if that layer will be worth the potential added revenue. You might be surprised that the added upside might not be worth the added headache. Look at the potential net profits in both of your strategies and compare them on a percentage basis. If the PS + ABnB is netting higher profits but at lower percentage vs your straight B+H strategy, you might want to adjust and run the numbers on a B+H strategy in PS. Remember if you do an ABnB strategy, you have to furnish the unit. That furniture is only depreciating and you have to set aside funds for replacement. Just a thought... good luck to you.