How should I invest my $200,000

Question

Hello everyone!

I'm a 25 year old kid currently going to school for engineering. Base in the Niagara region.

current have 150,000-200,000 to start investing with.

Im very interested in rental properties, or possibly flipping if a good deal arises.

im wondering how I should go about investing this money. Should I split it up into down payments and take out mortgages on multiple properties (if my credit will even allow it) or should I search for 1 property buy it up front and see where the road takes me from there?

And at the very least if there's any information about starting in real estate with money in your pocket and working it out from there that would be great!'

Terry Nguyen · Answer

@David Lewis-Laurent Hey David, it all depends on your goals of REI. Is it cashflow to supplement or replace your income? To build equity over time? To make interest through your money via lending?

My partner and I are investing in value add and conversion projects in Hamilton. Example: Single Family to Duplex.

Message me and we can connect and talk

Cheers

Terry

David Lewis-Laurent · Answer

Hey thanks for all this tip guys!

Looking at my skills and everything I think I might start with a fix and flip. I mean sounds insane but I've seen some deals that have slipped out of my grasp (mostly cause I want to learn the market as best I can) that couldn't have made me up to 100,000 in one flip... I mean I've watch some properties go from 160,000-280,000 once they hit the market again in st Catherine's.

i've been emailing Realtors about these House's and alot makes sense to me but some things I get kind of confused with..

like on occation the house will state that 'Offers must be submitted by such and such a date' is this kind of like a bidding war for the house where the highest bidder takes it at the end? And is there any ways to know what offers are being placed on the house?

also from my research, I'll use one real life example but I know how much these can vary...

there was a house almost right next store to me for going for 130,000$ with the same stipulation where offers must be submitted by a date. The place is very old, stucco exterior, I mean it even have a wood fire stove, a small but nice one. It's almost completely gutted, and what looks like wooden walls in the living room and paneling everywhere else. Although is says 3 bedrooms there only 1 what looks like small bedroom on the first floor. And then only to rooms upstairs (it's like an attic but looks roomy) one of those rooms includes the stairs coming up.

houses in the area, that very much resemble something that was just flipped are going for 280,000 and are the same size or smaller. With my math...

if it's bought at 130,000 and another 30,000 is put into Reno that's 160,000. An insanely high price for the Reno (if done by myself, and maybe a plumber and electrician come by) and it if I cover the place in siding or something... I mean all and all even if I dump a whole 170,000 into the project I see myself still making 60,000 (if I could sell for 230,000) and I'm still trying to figure out the taxes and everything to find out how much I'll really make.... I assume half that... Which I mean damn after maybe 6-8 months even a year 30,000 is more money then I have EVER banked in a year and that's before taxes!

after all that I guess I'm asking do I sound insane? Are my estimates completely ridiculous? (I am trying to over estimate the cost and under estimate the return). Am I on the right track here and am I missing alot of much more Vidal info... I'm asking all of this because pretty much every cheap slightly 'run down' but fixable place I've found that's kinda got my heart racing when I run the numbers like... Even after a gross over estimation I could be making a very healthy amount of cash.

Thanks again guys

Shawn Coverdell · Answer

Learn to BRRRR houses and buy as many as you want or can handle with the same money over and over and over. It's a lot of work, but was less work than 9 to 5 till 65.

Roy Cleeves · Answer

@terry Nguyen

I would recommend you invest in a fix and flip like what Terry is recommending or Joint Venture with someone that can go on the title and go for appreciation or the Brrrr method where you get your money back and can invest again, while building long term wealth.

Good luck!

David Lewis-Laurent · Answer

I probably won't be able to get a mortgage with my income but I do have a co-singer

Patrick Archer · Answer

Do you have an income?  Will be tough to get a mortgage without it (or you’ll need someone to co-sign).  Projected rental income won’t necessarily be counted at face value during the application process.

How should I invest my $200,000

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