$100k to invest- one or multiple homes

[Zack R.]

$100k to invest.

Purchase one rental for $100k, no mortgage.

Use the $100k as several down payments on several homes.

Two different paths and I’m sure there are plenty of pros and cons here. But I can’t think of them. No mortgage sounds easy and returns would be higher. But then again I have no clue what I’m doing. Thanks!

[Mike D'Arrigo]

@Zack R. actually I don't see any pro's to putting the entire $100K in to a single property. Think of real estate no differently than stock. It's unlikely that you would invest everything in one stock. You're typically going to differentiate in a mutual fund or something. The more properties you have in your portfolio the more diversified your risk. If one property isn't performing well, the others can compensate. With $100K to work with, you can buy 3 properties in an affordable market like Indianapolis and Kansas City which are both strong cash flow markets. By using leverage, your COC return is much higher. With interest rates so low, I see no advantage to paying cash.