How would you invest 50k?

Question

I have 50k in savings and i want to buy my first investment property. I don't own a house yet but i have a very good rental deal. I am located in Naples, FL and the market is really expensive here. How would you invest that money ?

Joe Hammel · Answer

I'd buy 1 cash flowing investment for a purchase price around $100k

$20k Down

$15k closing costs and some repairs

$35k total

Still sitting on $15k savings.

Here is a picture of my portfolio in Metro Detroit...has multiple properties that fit this description and cash flow well.

Julien J. · Answer

@Hrysa Zirou

Househack.

Start talking to lender to figure out your budget.

Wyatt Wolff · Answer

First qualifying question: what are your living expenses?

Second: Is it just you or is it a family (spouse, kids, etc).

If a house hack is possible, do it. It is THE best bang for your buck that you will get. I cannot think of another way that you can both cut your own expenses, and start generating revenue in one move.

That's where I would start. Good Luck!

Christian Ehlers · Answer

I'd househack first if you can qualify for a loan and just get started that way with a 3.5-5% down loan. This will give you the training wheels to see if you really want to be a landlord long term without getting stuck with a rental in another state that you no longer want. Also it's less risky as you will be on site, your area will likely appreciate in price & rental rates better than the very inexpensive markets too.

Josh Stout · Answer

Going to jump in with the others suggesting a house hack if feasible. Obviously family situation can influence that decision but it's still worth heavy consideration. Something else to take note of is that Fannie just dropped the down payment requirement for owner occupied 2-4 units to 5%. This can be a huge win if played correctly and something I wish was around when I got started. Here's a link that talks about it in more detail...https://thisismortgage.com/fannie-mae-5-percent-down-multifamily-2-4-unit-mortgage/#:~:text=It's%20official%3A%20As%20of%20November,triplexes%2C%20and%20four%2Dplexes.

Mel F. · Answer

I would do what @Randa Dehaan said and use the $50k as a down payment towards a property in a cheaper area. However, it all depends on how much time you have. Having money to deploy is great, but how far it stretches depends on how much time in the day you can dedicate to real estate investing. Can you wholesale a few deals to add to the $50k and then invest in a rental in an expensive area like Naples?

Randa Dehaan · Answer

You could invest that money as a 20% down payment in a less expensive market. You could utilize a DSCR loan that doesn't qualify your income, but rather the property's ability to produce income. As long as it's a 1:1 ratio between the rental income and mortgage - it qualifies!

Michael Smythe · Answer

@Hrysa Zirou find a good OOS area to invest in and then find a good PMC & agent to work with.

Make sure you understand the Class of properties you intend to invest in, with the corresponding challenges.

Brian Lewis · Answer

As others have stated, I believe house-hacking would be your best bang for your buck. I started this way, as I'm sure a lot of others on here did. It was one of the best financial decisions I've made.

How would you invest 50k?

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