New real estate business with 100k-where would you start?

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New real estate business with 100k-where would you start?

Mia Duncan
Rental Property Investor · Seattle, WA · Member since 2021 · 17 posts · 15 votes

Hi! I’m new-ish to real estate with two properties. I have 100k and want to start a “real” real estate business. What would you all start with? And in what city? Curious...

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Luke Trovinger
Realtor · Denver, CO · Member since 2020 · 259 posts · 153 votes
5y

Hi @Mia Duncan! What are the areas of real estate that interest you? Are you focused primarily on acquiring additional rentals? Flipping? Wholesaling? I think the terrible answer is that it depends on the area you're interested in the most and would be comfortable seeing that $100k investment through :)

Personally I'd be interested in acquiring rental units with that $100k. That won't get a lot out here in my area, but other markets throughout the U.S. would allow for several. Checkout the midwest, you won't get as much (or hardly any) appreciation, but the cashflow is solid.

Congrats on your previous two deals and best of luck!

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  • Luke Trovinger
    Realtor · Denver, CO · Member since 2020 · 259 posts · 153 votes
    5y

    Hi @Mia Duncan! What are the areas of real estate that interest you? Are you focused primarily on acquiring additional rentals? Flipping? Wholesaling? I think the terrible answer is that it depends on the area you're interested in the most and would be comfortable seeing that $100k investment through :)

    Personally I'd be interested in acquiring rental units with that $100k. That won't get a lot out here in my area, but other markets throughout the U.S. would allow for several. Checkout the midwest, you won't get as much (or hardly any) appreciation, but the cashflow is solid.

    Congrats on your previous two deals and best of luck!

    4Reply
  • Mia Duncan
    OP
    Rental Property Investor · Seattle, WA · Member since 2021 · 17 posts · 15 votes
    5y

    @Luke Trovinger thank you!! That is my initial plan (rentals) though I’m interested in other types of deals. What I was kind of driving at is..what cheaper market might people pick right now? I super appreciate your comments! :)

    0Reply
  • Marc RiceBusiness Member
    Real Estate Agent · Columbus Cleveland Dayton, OH · Member since 2018 · 2k+ posts · 1k+ votes
    5y

    @Mia Duncan

    I’d look in the Midwest for affordable rentals at $100k a piece. You could buy 4 of those at $25k down on each of those and get off to the races.

    Another option is to BRRRR by buying a value add property and renovating it with your cash and then going to a bank at the end for a refinance to pull it all back out and to start again.

    [email protected]614-363-2787
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  • Scott Brewster
    Member since 2020 · 30 posts · 16 votes
    5y

    @Mia Duncan I would first and foremost invest some of that hard earned money into buying some books about real estate investing! Wholesaling, BRRRR, flipping, note investing, development, residential/commercial, and buy and hold are all different ways to invest in real estate. No one person can decide for you where to put your money first! I'd pick up some of the books in the BP book store and go from there and find out which one of the areas I mentioned really interested you the most because those were just a few that I could rattle off at a moments notice, the list goes on!

    0Reply
  • Alexander Szikla
    Real Estate Agent · New York City · Member since 2020 · 819 posts · 641 votes
    5y

    Definitely house hack via FHA in NYC right now. If you can get a 4 unit and a basement, that would be ideal and create major cash flow and equity creation, plus you can not worry about a property manager and boost your yield.

    Personally, I am very bullish on New York and NYC itself. Sure it suffered due to COVID, but you want to buy when there is distress. I think all the folks who moved away are already getting bored and already coming back. Plus, the vaccine is getting rolled out which will curb the spread tremendously. Now is the time to buy.

    Cap rates came all the way down to 3% (or below!) during the "boom" times but COVID has loosened everything up and now 5% can be had in Manhattan, 6%-7% in Brooklyn and even 8% in the Bronx. Nationwide rates hit a low of 2.7% - so there has really never been a better time "spread" wise.

    Long term, I think NYC will come back as it always has time and time again. I am also a great believer in investing when there is distress and deploying capital when you can.

    If you are looking for yield in the short run, Manhattan may not be for you. However, it is certainly the most attractive it has been in years from a cash flow perspective. If you are seeking out asset accumulation and equity appreciation over the long term then there are certainly fortunes to be made. And there is still plenty of cash flow opportunities in the outer boroughs if you buy right!

    3Reply
  • Young Park
    Rental Property Investor · Dallas, TX · Member since 2018 · 64 posts · 43 votes
    5y

    Hi @Mia Duncan! Several people mentioned it already about what strategy you’d like to use, but if I were to assume that you’re going for rental properties, I agree with others that the Midwest may be the ideal place to invest in.

    I live in Hawaii and invest long distance using the brrrr strategy in the Kansas City market. Of course, there are a lot of great rental markets in the Midwest, so you should do your own research. Personally for me, it all comes down to WHO do you know in that specific market to leverage relationship to get started.

    If you have any questions, please let me know! Thanks.

    0Reply
  • Mia Duncan
    OP
    Rental Property Investor · Seattle, WA · Member since 2021 · 17 posts · 15 votes
    5y

    @Marc Rice I’m so glad you said that!! That is my current plan (looking at duplexes in central Ohio) but wondered if anyone else would echo that!!

    0Reply
  • Mia Duncan
    OP
    Rental Property Investor · Seattle, WA · Member since 2021 · 17 posts · 15 votes
    5y

    @Scott Brewster thank you!! At this time I do have two investments so not totally new. That said new ISH. I’m in wealth fit online classes and have read books on arv, brrrrr by Green and several others. Question: what book is your favorite and I’ll put it on my list? There are so many...it can be overwhelming. Also open to recommendations on other online classes!

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  • Mia Duncan
    OP
    Rental Property Investor · Seattle, WA · Member since 2021 · 17 posts · 15 votes
    5y

    @Alexander Szikla I never would’ve thought of NYC but I will absolutely look. I think you make great points. I’m “old” enough I already own a home and some investments (only 2, very new) but I wish so badly someone had told me about the house hack. Brilliant. Thank you again for

    The advice on nyc!!

    0Reply
  • Mia Duncan
    OP
    Rental Property Investor · Seattle, WA · Member since 2021 · 17 posts · 15 votes
    5y

    @Young Park thank you! I'm looking to move to Columbus and have looked there (but prices have gone a little crazy) as well as Dayton (almost too good to be true?) and Cincinnati. Those all seem to be places with good Rentometer and rental ROI with ability to buy with less cash. Any experience in these areas specifically? It helps to hear my Midwest plan isn't off the mark from those more experienced....

    1Reply
  • Brandon GoldsmithBusiness Member
    Real Estate Agent · Columbus, OH · Member since 2020 · 1k+ posts · 1k+ votes
    5y

    There are a lot of places where that money could go far. I would decide what you are trying to accomplish REI wise and narrow down a few markets from there. Building a team with be the most crucial part so at the end of the day if you have a good team you can have success anywhere. I would recommend taking a look at some ohio markets. @Mia Duncan

    [email protected]614-963-3340
    1Reply
  • Mia Duncan
    OP
    Rental Property Investor · Seattle, WA · Member since 2021 · 17 posts · 15 votes
    5y

    @Brandon Goldsmith I’m moving to Columbus so very much interested in developing a core four!

    1Reply
  • Jay Chopra
    JV Contractor Syndicate Piscataway, NJ · Member since 2015 · 283 posts · 24 votes
    5y

    @Mia Duncan

    I can you a portfolio to look at

    0Reply
  • Scott Brewster
    Member since 2020 · 30 posts · 16 votes
    5y
    Originally posted by @Mia Duncan:

    @Scott Brewster thank you!! At this time I do have two investments so not totally new. That said new ISH. I’m in wealth fit online classes and have read books on arv, brrrrr by Green and several others. Question: what book is your favorite and I’ll put it on my list? There are so many...it can be overwhelming. Also open to recommendations on other online classes!

    BRRRR is a great one for sure, Long Distance Real Estate Investing (this also goes pretty deep into house flipping) is a must if your market is too expensive to reasonably get cash flow out of. Investing with little or no money down was a great one to learn about all the options for financing real estate and is exactly what kicked off my company. If you really want to get into real estate, definitely pick up the Tax Strategies book! Those three were my favorites off of BP.

    Not on the BP book store I'd recommend The loopholes of real estate by Garret Sutton for a pretty in depth dive into important information. Beware that book feels like it never ends but it had great points lol. I would also recommend The ABCs of property management by Ken McElroy.

    I know that's a ton to read but they all cover quite a bit about real estate investing in the whole and you'll get a much bigger picture of what's out there. Note investing is a little foreign to me and it seems like a bit of an end game, and wholesaling is insanely profitable but it takes some serious hustle and commitment to get there so if you have a full time life outside of this it's probably not as feasible as most people claim it to be. 

     Other notable books just for negotiation and communicating with people I'd highly recommend Dale Carnegie's  How to win friends and influence people. That book should be on every person's shelf who has to or wants to deal with people throughout life!

    But on a serious note, don't get too wrapped up in analysis paralysis HOWEVER, make sure you're well educated before you jump into something huge. Only you will know when you're ready to commit to something and where your comfort zone is! And furthermore once you get into real estate investing you learn SO much that you can't get in a book and so many new doors will open for you! So get the basics, get some confidence in your ability, and get into a deal!

    Hope this lengthy reply helped a bit!

    2Reply
  • Mia Duncan
    OP
    Rental Property Investor · Seattle, WA · Member since 2021 · 17 posts · 15 votes
    5y

    @Jay Chopra sure that would be great!

    0Reply
  • Jay Chopra
    JV Contractor Syndicate Piscataway, NJ · Member since 2015 · 283 posts · 24 votes
    5y

    @Mia Duncan

    Either please send me your email ID or reply to mine to send you this by attachment  

    0Reply
  • Remington LymanBusiness Member
    Real Estate Agent · Columbus, OH · Member since 2017 · 6k+ posts · 7k+ votes
    5y
    Originally posted by @Mia Duncan:

    Hi! I’m new-ish to real estate with two properties. I have 100k and want to start a “real” real estate business. What would you all start with? And in what city? Curious...

     I started house hacking in Columbus, Ohio. I was living here and working at JPMorgan.

    [email protected]614-541-8475Podcast Guest on Show My Job Laid Me Off, So I Replaced My Salary with Rentals
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    2Reply
  • Garrett Crain
    Oklahoma City, OK · Member since 2015 · 15 posts · 5 votes
    5y

    @Mia Duncan

    Hi Mia. My partners and I started with $105,000 and closed on our first property on March 23, 2020. We are in the OKC market which allows our dollar to go very far. There has been some great advice so far and lots of options, maybe too many!

    We utilized the BRRRR method to build over $4,000/month in net cash flow and almost $200,000 in equity in that year. Although, the BRRR method might not be entirely feasible if you are remote. We work with the contractors and manage the rehabs in person.

    I know there are great opportunities to build cash flow for Out of State investors through making minimum down payments. I think as long as you go with either of those, you’ll be just fine and build a nice portfolio.

    1Reply
  • Mia Duncan
    OP
    Rental Property Investor · Seattle, WA · Member since 2021 · 17 posts · 15 votes
    5y

    @Scott Brewster this is awesome!! My book list just exploded but I can see a couple in here I could benefit from.

    1Reply
  • Mia Duncan
    OP
    Rental Property Investor · Seattle, WA · Member since 2021 · 17 posts · 15 votes
    5y

    @Garrett Crain this is very inspiring!!! Thank you for sharing this....I hope that can happen for us too!

    0Reply
  • Muhammad Ahmad
    San Jose · Member since 2021 · 2 posts · 0 votes
    5y

    @Young Park please if possible DM me I want some suggestions and advices

    0Reply
  • Young Park
    Rental Property Investor · Dallas, TX · Member since 2018 · 64 posts · 43 votes
    5y

    @Mia Duncan I unfortunately don't know these specific markets but there are SO many people investing in those areas that I'm sure can help you reach your goals :) And if you're physically moving to Columbus, OH, I'm sure you'll find good deals in your own backyard. Best of luck!

    2Reply
  • Brian G.
    Rental Property Investor · Los Angeles, CA · Member since 2013 · 1k+ posts · 1k+ votes
    5y

    @Mia Duncan if you are moving to Columbus, then hold on to your capital until you know whether or not that’s a market you want to invest in. My $.02

    1Reply
  • Remington LymanBusiness Member
    Real Estate Agent · Columbus, OH · Member since 2017 · 6k+ posts · 7k+ votes
    5y
    Originally posted by @Brian G.:

    @Mia Duncan if you are moving to Columbus, then hold on to your capital until you know whether or not that’s a market you want to invest in. My $.02

    Buy and hold in Columbus, Ohio. Diamonds hands to the moon.

    [email protected]614-541-8475Podcast Guest on Show My Job Laid Me Off, So I Replaced My Salary with Rentals
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  • James Hamling
    Real Estate Broker · Minneapolis, MN · Member since 2011 · 5k+ posts · 6k+ votes
    5y

    @Mia Duncan feeling overwhelmed yet.... 

    What you asked was a business question, and thus far all I have seen is strategy answers. I think I will lend a business answer. 

    The issue at hand is your without in depth specific experience, without certainty of niche, without certainty of area or market, without focus is the short version so in short your perfectly set to do the smart $ thing, none of the above and any/all of the above! 

    I suggest taking a touch of time and building a list of persons and places to connect with and market yourself as a "Shark Of REI" and present yourself as available for investors to pitch you on their deal/ strategy/ market and why you should fund their deal. Now, your in the control position, free of stress of sorting what to do, where, because your doing 1 thing, evaluating pitches. Let others fight for your involvement.

    In the end, you partner in a deal as the private $ BUT make sure to be involved in the entire operations in an oversight capacity. You will get to see the in's and out's of the strategy type, feel it out, all from the position of safety because you have cross collateralized your capital so even if it all falls a apart and fails, well, your safe. 

    Than it's simply a practice of rinse and repeat. You will have "the" superior position of no risk, all reward (if properly structure contract for such) and really double reward because your profiting in $ AND knowledge/experience. With time, you will find your draw too or from certain strategies, markets, styles. 

    As i said at beginning, you asked a business question and were fielding strategy answers, you don't need a strategy, you need a business plan, "Shark Of REI".

    2Reply
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