What to do with so much cash?

[RandyDalton]

Hi All,

If you had around 200-300K of cash/LOC to spend where would you spend it?

Purchasing many townhomes with small positive cash flow and low downpayments? A few 2/4plexes with slightly better cash flow? Or one multi with better cashflow but the biggest downpayment requirements? I hear the stock market is expected to rise!

As an engineer with some reno experience and a wife who is an Interior Decorator with considerable Kitchen and Bath Design experience we are also considering turnkey versus reno and rent strategies.

All comments are appreciated in advance as I am hoping to learn and redirect my purchasing efforts.

Regards...Randy D.

 

[markl]

Randy,

I kind of like lease to owns you get positive cash flow and less work. Plus you are helping people become home owners. You can mitigate some of the risks by using a tenant first strategy which means having a tenant before you ever look for a property. We have a client who has purchased 10 LTO homes and is making $6,000.00 per month positive cash flow. Just thought I would throw another idea at you.

Regards,

 

[Thomas Beyer]

Ask yourself HOW MUCH TIME you wish to spend at it .. initially and ongoing ...



Also ask how liquid it has to be ? do you need access to all this cash in a year ? in 5 years ? in 10 ? apportion it according to your needs which depend on your life's situation (kids in university, opening your own consulting practice, risk of someone losing their job, taking 6 months off for a vacation ...)



1h/week ? 5h/week ? 12h/week ? 60h/week ?



usually you get better cash-flow with an apartment building or larger commercial property, with less hours, than with townhouses or single-family but it is not as liquid as perhaps 8 townhouses where you can sell one quickly.



read this for starters: http://myreinspace.com/public_forums1/General_Discussion/61-4391-How_to_get_started_.html



You should certainly spread your $s around, say 80-100K per: some in REITs or stocks, some with private syndicators or JVs, and some money in your own properties !

 

[housingrental]

Randy - Come to Waterloo and buy and self renovate an apartment building.

 

[Thomas Beyer]

QUOTE (housingrental @ Jun 18 2009, 04:38 PM) ...and buy and self renovate an apartment building.

perhaps IF this is his desire .. not everyone likes to do that themselves ..

think: return on money .. and think: return on time !!

 

[housingrental]

Good point.
I should have wrote - or hire me to do get it done for you.

QUOTE (thomasbeyer2000 @ Jun 18 2009, 07:11 PM) perhaps IF this is his desire .. not everyone likes to do that themselves ..

think: return on money .. and think: return on time !!

 

[Nir]

no doubt a ~$1M apartment building - do it right and you`re... free!

 

[BrianPersaud]

QUOTE (RandyDalton @ Jun 18 2009, 10:27 AM) Hi All,

If you had around 200-300K of cash/LOC to spend where would you spend it?

Purchasing many townhomes with small positive cash flow and low downpayments? A few 2/4plexes with slightly better cash flow? Or one multi with better cashflow but the biggest downpayment requirements? I hear the stock market is expected to rise!

As an engineer with some reno experience and a wife who is an Interior Decorator with considerable Kitchen and Bath Design experience we are also considering turnkey versus reno and rent strategies.

All comments are appreciated in advance as I am hoping to learn and redirect my purchasing efforts.

Regards...Randy D.


Have you thought of assigning deals or doing JV`s..that is huge deposit money. I would tie up deals under market value for cashflow, look for JV partners...and if I couldn`t find a JV partner I would close it myself or assign it.

Imagine you contracted an apartment building with 50 doors for $40k a door, the comps are coming in at $45k a door and you sell it for $42/door.

Vendors would appreciate the large deposit because it shows you are serious and would be open to giving it to you under market. Work with a lawyer to structure your offers, understand the offers inside out so your capital is not at too much risk.

It takes time to get these deals, lots of relationship building...if you want to discuss more email me [email protected]