Options for investor: 100k

[Mike Freske]

Hello all,

Been lurking around the forums for a while and always love to see the advice and knowledge everyone is willing to share.

I have a "hypothetical" situation and want to get your thoughts. 

A person has 100k to work with. They can place that money in a 10% short-term 3 year note which would be secured by a SFH. Or they can look to obtain buy and hold rentals. The market in MN still seems to be fairly good. For example, a duplex built in the 1970s in a B-/C+ neighborhood, not needing much work, will sell for about 300-330k with each side renting for between $1200-1400. Obviously these aren't exact numbers, but just ballpark.

First question, and knowing the audience I think I know the answer but curious as to responses, would anyone here look to purchase the note and be satisfied with the 10% return?

Second question, more general, what type of cash on cash ROI should one be looking for if they use the 100k to buy some rentals? Knowing they can get the 10% on the note. I know lots of people talk about cash flow per door, which is good to know, but not sure it always tells the full story.

Or a third option?

Thoughts?  Thanks!