Starting Out in REI - Which Path to take?

[Daniel B.]

Hi Everyone - I am new to real estate investing and wondering what path is best to take. I currently make ~$250k/year in salary, and my ultimate goal is to replace this with passive income. I live in San Francisco where I own my home. Appreciation on my home has left me with about  $300k in untapped equity I could access.

Are turn key midwesten single family homes my best option? It appears I would need to look out of state for cash flowing rentals, and with my job/family commitments I can devout 1-2 hours per day to REI.

Any advice would be greatly appreciated!

[David Thompson]

Daniel,

If you are an accredited investor (earning over $200K for past 2 years with an expectation to continue so) then you have some other options besides turnkey. There is ample support for a variety of niches but having invested in both SFR and MF, I prefer MF syndications. You can get great returns and be truly passive, but also learn if you have intention. As a passive investor, you can diversify into MF, storage, mobile home parks, you name it. SFR is a way but most SFR investor migrate a portion of their portfolio to other REI asset classes over time and often to syndication after the hassles of owning several homes starts to take its toll. You could also put some money to work in both turnkey and syndication deals to see which works better for you. The ease of totally passive investing w/syndication is hard to beat though. Here's an article on why I like investing in large apartments and 25 FAQs on syndication to ponder.

https://www.biggerpockets.com/blogs/9145/53820-why...

https://www.biggerpockets.com/blogs/9145/65780-syn...