How much capital do you aim for when embarking anew?

[Austin Soros]

When starting a new real estate project, how much seed capital do you prefer to save prior to carrying out concept, and why? Regarding the down payment, do you have a specific percentage you prefer for an unusual reason? I am seeking to broaden my perspective towards down payments and initial capital, having paid the 15-20% standard in most past deals. 

[Kyle McCorkel]

Austin Soros
Hm. Depends on your strategy. If you are doing BRRRRs or flips then you need a lot more capital to purchase and rehab in cash. Although I would count hard money, private money and lines of credit as well as cash for these projects.

For turnkey properties, 20% DP with conventional loans is standard and required.

At a minimum you should have capital to cover the initial acquisition and rehab (if applicable), plus closing costs, plus $10k in cold hard cash extra for reserves.

At this point I try to have double that in total working capital. That way if I get into one deal I still have “dry powder” ready to take on another deal if one just pops up. I’m trying not to tie up everything all at once.