What Would You Buy in Real Estate If You Had $1 MM in Cash Today?

[Corey Dutton]

This was an article I found online but it was a SPAM ARTICLE which means it was written by someone likely overseas who doesn't speak English. However, I thought the question being posed in the article was a good question so I decided to re-post it here for discussion.

If $1 MM was available to you right now for investing in real estate, what types of properties would you purchase? To some of you, this may seem like a trivial sum of money, but not to all of you.

Would having $1 MM change your point of view? Would you still focus on and buy the same types of properties? In the same areas? Or would you use the $1 MM to invest in something larger and earn bigger return on investment?

Or would you give up real estate investing altogether and become a private money lender? Being a landlord or flipper is tiring.

What would you do with $1 MM today?

[Mike H.]

First off, you have just listed my absolute dream scenario.
i.e. If only I had a million dollars to invest in real estate.

For me, I would take that to a bank and try to leverage it as best I could. I would try to get a bank to give me another million in credit to be secured by real estate at LTV's of 50% or better.

Then I would start buying SFH's with the same target criteria I'm buying now. I tend to be all-in at about 80k on my deals but could probably get in a little cheaper if I wasn't having to pay for the hard money loans to purchase and the refi fees to refi. I'd be looking to be all in at 75k.

That would technically allow me to buy 26 homes - which I'm sure I could do in about 18 mos working full time - or 12 if I quit my job. :-)

Since half of the 75k for each house would be paid out of the 1mil in cash, I'd only owe about 38k per house and the cash flow should be roughly $500 to $600 per month. Added to the 15 houses I have today at $300 a month or so and I'd be golden.

Then I'd live off half the profits and take the other half and continue buying more houses or save up and look to get into multifamily big enough that the management was built in to the costs.

How's that for some dreaming...... :-)

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