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How best to invest 300-400K???

REIGirl

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With all the wealth of knowledge and experience within this forum, I am wondering how best to invest 300-400K. My primary/initial focus has been on apartment buildings, I would also like something that cashflows well, however, I am open to suggestions.

Also, what would you say the anticipated cashflow per door for an apartment building in AB would be?

Thank you!
 

Cory Sperle

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With all the wealth of knowledge and experience within this forum, I am wondering how best to invest 300-400K. My primary/initial focus has been on apartment buildings, I would also like something that cashflows well, however, I am open to suggestions.

Also, what would you say the anticipated cashflow per door for an apartment building in AB would be?

Thank you!
400K is below the entry point to get into a decent apartment building, although I'm selling a 12 suiter right now that you can borrow 85% loan to value that is CMHC ready.

The residential real estate market and stock market are both HOT right now so buyer beware, and I expect corrections in both in the coming months. Solid MF projects that are CMHC ready and value adds at the right price are still a good bet, as are REITS, still some are 50% of what they were pre-pandemic.
 

REIGirl

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Hi Cory,

Thank you for your reply! Yes, we were thinking a building around that size would be a good entry point for us getting into multifamily. We were also thinking about something we can fix up to add value
 

Thomas Beyer

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Hi Cory,

Thank you for your reply! Yes, we were thinking a building around that size would be a good entry point for us getting into multifamily. We were also thinking about something we can fix up to add value

Consider buying any building with 15% down, for example Cory’s in SK.

That’s how I started: never paying more than 15% down. That is rare to impossible today but does exist occasionally.

So a 15 suiter at $120,000/door ie $1.8M could be acquired with 300,000!


Thomas Beyer, Asset Manager, Investor, Community Improver, Author, Father, Mentor www.prestprop.com
 

Cory Sperle

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Consider buying any building with 15% down, for example Cory’s in SK.

That’s how I started: never paying more than 15% down. That is rare to impossible today but does exist occasionally.

So a 15 suiter at $120,000/door ie $1.8M could be acquired with 300,000!


Thomas Beyer, Asset Manager, Investor, Community Improver, Author, Father, Mentor www.prestprop.com
Rare indeed! Yes it's not the early 2000's so tough to find CMHC ready product

My building meets the criteria, and I may just refinance myself. A full 300 bps spread between CMHC borrowing rate and actual CAP (2.00 to 5.00) so very appealing for an armchair investment!
 

Thomas Beyer

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Real estate comes in physical form ie real buildings or in more liquids and/or fractional forms ie REITs, stocks or LPs.

If you buy a REIT, for example that yields 6% with your $300,000 and borrow 50% in a margin account you can buy $600,000 worth of REITs yielding $36,000/yr - minus interest cost, say 3% ie $9000 on the $300,000 borrowed and your cash flow is still $27,000 per year ie 9%. https://apple.news/AB3HKIw-nR8e2_UTWhenJaA

Some REITs yield more say 8% then the math is $48,000-$9000 ie $37,000 ie over 12% cash on cashROI paid monthly. Tough to beat with real physical real estate ! Of course, more volatile but also more liquid !

Residential properties or REITs generally yield far less but may appreciate more than commercial REITs that own hotels, shopping centres, office buildings or industrial buildings.
 
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REIGirl

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Rare indeed! Yes it's not the early 2000's so tough to find CMHC ready product

My building meets the criteria, and I may just refinance myself. A full 300 bps spread between CMHC borrowing rate and actual CAP (2.00 to 5.00) so very appealing for an armchair investment!
Hi Corey,

Thank you for this information!
 

REIGirl

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Real estate comes in physical form ie real buildings or in more liquids and/or fractional forms ie REITs, stocks or LPs.

If you buy a REIT, for example that yields 6% with your $300,000 and borrow 50% in a margin account you can buy $600,000 with of REITs yielding $36,000/yr - minus interest cost, say 3% ie $9000 on the $300,000 borrowed and your cash flow is still $27,000 per year ie 9%. https://apple.news/AB3HKIw-nR8e2_UTWhenJaA

Residential properties or REITs generally yield far less but may appreciate more than commercial REITs that own hotels, shopping centres, office buildings or industrial buildings.
Wow! Great insight!
 

Vancouver.Investor

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You can always private lend the money as well. We always secure the money on a property with equity, maybe two depending on how much we're lending. We also charge a $1k lenders fee. We are currently in 3 deals right now. Here is what we lent and currently make monthly:

- $250k @ 20% interest, monthly interest payments $4,166
- $165k @ 14% interest, monthly interest payments $1,925
- $250k @ 15% interest, monthly interest payments $3,125

In total we make $9.2k per month, passively. The borrowers are also responsible for our lawyer fees. We usually do a 6 month or less term as well.

Hope this helps with giving you other options :)
 

Thomas Beyer

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You can always private lend the money as well. We always secure the money on a property with equity, maybe two depending on how much we're lending. We also charge a $1k lenders fee. We are currently in 3 deals right now. Here is what we lent and currently make monthly:

- $250k @ 20% interest, monthly interest payments $4,166
- $165k @ 14% interest, monthly interest payments $1,925
- $250k @ 15% interest, monthly interest payments $3,125

In total we make $9.2k per month, passively. The borrowers are also responsible for our lawyer fees. We usually do a 6 month or less term as well.

Hope this helps with giving you other options :)

Passively?

Don’t you have to deeply analyze the deal, then monitor it AND be prepared to foreclose on the asset and then manage it to retrieve your money ?


Thomas Beyer, Asset Manager & Improver, Hard Asset Investor & DeFi Asset Hodler, Author, Father, Mentor, Hiker, Kayaker www.prestprop.com
 

nisha0930

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In every stage of life, when someone asks how to invest 300-400k? I am always in deep thinking & my initial or main focus has been on affordable housing properties because I don't want to cashflow on other things. I want to use my hard-earned money very well.
Also, I am open to suggestions and discussions.
Thankyou!
 

Manny Treivish

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With all the wealth of knowledge and experience within this forum, I am wondering how best to invest 300-400K. My primary/initial focus has been on apartment buildings, I would also like something that cashflows well, however, I am open to suggestions.

Also, what would you say the anticipated cashflow per door for an apartment building in AB would be?

Thank you!
there is a flip I wanted to do but didn't have the money to do it. Could be a quick turnaround with about 100K in income potential. It is in BC. Feel free to call me and I am happy to share the details. https://linktr.ee/MannyTreivish
 

TheoCaper

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Feb 9, 2023
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Investing 300-400K is awesome! Apartment buildings are a popular option, but don't forget to explore other opportunities too. Stocks, bonds, or real estate investment trusts (REITs) can diversify your portfolio. As for cashflow per door in AB, it varies based on location, property condition, and rental market. It's a good idea to reach out to a Mortgage Broker in Wirral for personalized advice. Best of luck with your investment journey
 
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