$100,000 To Invest in DFW- 1 rental, or grow pile of money with Flips

[Curtis C.]

Hello Everyone,

I am contemplating between 2 strategies right now for $100,000 cash I have to invest. I do not want to leverage any property. I like to sleep easy at night and not rest on a house of cards. The 2 strategies I am contemplating between are:

1) Grow initial pile of money from several flips, allowing me to buy 2 or 3 rental properties free and clear with cash
2) Or take what I have now and Purchase a single rental with cash.

Here in North Texas the bread and butter properties are about $120,000 for rental units. A little more expensive for a retail type flip, but this is all accounting for the 70% minus repairs rule.

I am open to suggestions and comments from the more experienced folks here, thank you

[Ben Leybovich]

Curtis Cook Flipping is unequivocally more risky than long-term investments. Think about this – the entire process relies on 1 and only 1 exit strategy: Selling. If something happens and you can’t sell, then you are in big trouble. If you don’t estimate repairs correctly; if market conditions change; if your contractor walks out on you – happens all the time to newbies; ect. Flipping is how a lot of guys got caught a few years back!

95% of money in flipping is made by 5% of people – the pros…

Rentals provide you with wiggle room – as long as there is CF, you can sit on it and wait. Leverage is the single biggest advantage of REI over other investment vehicles. There is risk in all kinds of investing, but if you can not sleep at night with a 30-year fixed rate loan at 4% on a 4-plex, then RE may not be the best choice for you. Making other people's money and other people's talents work for us is how many before us have achieved riches…