Rehabbing or Rentals? Is there a final VERDICT?

Rehabbing or Rentals? Is there a final VERDICT?

Los Angeles, CA · Member since 2009 · 717 posts · 50 votes

Hello all. I've read the previous posts on this topic, but still feel a bit confused. If my end goal was to get into Commercial deals, lets say within 5 years and by that time the market goes up; which strategy is better? So to make this simple. Is it better having 1mil in cash or 2-3mil in networth and tax benefits? I may be thinking is wrong, but since the market is the way it is, and Commercial is not at its bottom, isn't it better to hold onto properties for the tax benefits, appreciation then sell when the commercial market is at its bottom then convert them 1031? I remember Vikram saying that laser focusing is the key in business which I 100% agree, but it seems as with Real Estate it's a bit different because of the various factors involved. Please advise.

Edit: Basically, I would like to know how to get into the Commercial game faster, because once I am a player in the Commercial game, then I'm sure I would not deal with SFH's, but who knows.

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  • Specialist · Cleveland, OH · Member since 2011 · 1k+ posts · 852 votes
    15y

    Greg,

    Great question, I am in the commerical game, and I still do TONS with SFH. I like to sell contracts. It does not take any of my capital or my credit, and invest into free and clear. It is not a sexy plan, but it is stable and works. There are two types of people, those who pay interest, and those that earn it! LOL! :mrgreen:

  • Real Estate Investor · Apple Valley, MN · Member since 2009 · 35 posts · 2 votes
    14y

    Hi Greg,

    Most of the accomplished investors that I meet in the TC say that the main objective should be to transfer SFH and Small multi-units into large commercial properties asap. There is a lot of talk in regards to 1031's. I found recently that there is a local RE Exchangers club. That sounds like an excellent go-to source. I've learned the reason why commercial is so preferred is because you have a solid property management company handle all of the operations, and in the meantime, the property's value rises while increasing income and decreasing the expenses. I've also heard incredible "flip" scenarios in regards to commercial properties...

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