$165K CASH saved up, what would you do with it?

Question

Hey all experts,

I live in upstate NY. I have saved up $165K in cash. What would you do if you were in my shoes?  Is that enough to start ground-up construction? Any suggestion would be highly appreciated.

Doug Smith · Answer

We've been doing ground-up for many years and we lend to small builders and investors doing ground up. My advice would be to increase your level of difficulty gradually. You work up to the major leagues as there is a lot to learn. If you've not flipped before, start with a simple, basic, cosmetic flip, then progressively get more complex with it before finally moving to basic ground up. You don't want to jump right into the fire. Build up to it. Ground up is a different animal.

Aaron Zimmerman · Answer

House hack first in the best property you can afford.

if there's any excess cash, see if you could buy another property such as a 2-4 unit. Otherwise, save that money and do another house hack a year later

Sasha Fukuda · Answer

You don't give many details, but I'll assume you don't have a family, don't have a house, want to stay in the area, and that there are small multi family apartments in the area. Given all these assumptions, I'd buy a triplex or a quad and live in one of the units. Maybe I'd even go small commercial instead (5 or 6 units). I'd also try to keep a pretty big emergency fund.

Henry Lazerow · Answer

I always recommend my first time clients do a house hack. Buy in an area you would live as these areas will have good tenants and growth, doing owner occupied can buy as little as 5 to 10% down which leaves some money to do cosmetic value adds. Avoid cheap out of state areas, these often are just on paper returns and turn into complete money pits.

Remington Lyman · Answer

My first deal was a house hack.

That is enought money for groud-up contruction if you get the right contruction loan but if you have never done that before then I would recommend doing something different until you have gained experience

Marc Rice · Answer

I would start researching different markets, speak with the local agents and decide on 2-3 markets, finally, which can provide you with great cash flow and appreciation

Alfath Ahmed · Answer

I would flip first and do like 30-40 homes. You can honestly make more money doing that. Why don't you look into buffalo NY since it is so close to you.

If you look OOS then look at my market. I think its better than all the others.

Denise Supplee · Answer

Hi @Liam Talukdar, If I were in your shoes, I’d first clarify my return goal and risk tolerance, then consider using that capital as a strong down payment for new construction with a construction loan, or deploy it into value-add or small multifamily deals where the risk is lower and cash flow is quicker. Ground-up can work, but it’s capital-intensive and very market-specific, especially in upstate NY.

Jules Aton · Answer

I'd buy a primary home in an area where you want to stay for a while with an eye on ease of resale or rental in the future which generally comes down to school district. My strategy would be 50% on the property and the other 50% low cost TSM index fund for diversification, liquidity and truly passive income.

$165K CASH saved up, what would you do with it?

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