If you had $50k cash and lived in LA, what would you do?

[Julian L.]

Heres my situation: 

I'm house hacking my condo in Santa Monica, owe $346k and its worth about $460k. 

I have about $50k in cash outside of retirement to use toward another property. The ultimate goal is to create some passive income. The problem I'm having is LA is so incredibly expensive, $50K won't do much out here. 

I've thought about:

a) Continuing to save another $50k and use $100k total as a 20% downpayment toward a $500k property in the next 2 years

b) Buying a rental long distance in my college town back in the midwest

c) Trying to pick the next "hot neighborhood" in LA, buying a house here in LA that barely cashflows and pray it goes up in value. (Sounds dumb as I'm typing it out)

d) Another option

Thoughts?

[Jim Keller]

Originally posted by @Mike J.:

@Julian L. LOL on what you wrote for Option C. Hello from another LA investor. You're certainly not alone in asking this. I've been leaning towards looking out-of-state. Additionally, I've been learning more about the world of note investing which may be something you might be interested in. Check out BP Podcast #28 with Dave Van Horn for an introduction. Hope this helps.

 Hi guys

Come on out to the Inland Empire every deal I have done this year I have done with 1/2 the amount your talking about.  We made 10 separate investments all way under $50,000 and used private "hard money" for the rest and profited handsomely.  Flipping is alive and well in Riverside, and San Bernardino County I can recommend the MEET UP at the Mission Inn the 3rd Wednesday of the month,  I'm there and 75 others talking about flipping homes in the area.

Good Luck

Jim