All Forum Posts by: Blake Pieroni

Quote from @Andrea Diaz:

Quote from @Blake Pieroni:

@Andrea Diaz Congrats on your journey so far, 100k is a lot of money!

I think first off, IMO you need to decide two things for yourself.

1.) Why do you want to invest in real estate? 

2.) Do you want to be an active investor or passive investor?

Active: Finding the deals, underwriting them, putting everything together, executing the biz plan and managing the asset(s) afterwards. Passive: investing with another group and relying on them to all of this and be good stewards of your money.

I'd love to hear your specific goal for this 100k to better give my opinion. Nevertheless, I wish you the best in this new adventure!

Hey Blake! 

I´d probably want to start as a passive investor, work a buy-and-hold portfolio strategy for long-term investments. I am an aspiring multifamily investor. 

My why is clear, I am a single mom who wants to provide financial security and quality time to my son. Also, I have lived in 3 different countries and I have invested in 2 single family homes, successfully, in two of them. 

So obviously there is no "one single right way", but what would YOU do?

Thanks for the time!

Andrea, thank you for the reply.

Since you want to be a passive investor (as do I)
If it were me with the 100k, I would get a list of 4-7 sponsors and meet with them, in hopes of vetting them thoroughly.
Since I am young and want my money to grow a lot, I would place the 100k in the best growth position with my preferred sponsor. Likely doubling the 100k in 4-5 years and 4x over 10. Then I would repeat with the now 400k for another 10. Now its 1.6M with no additional capital investment.

I'm 26, so again this is what I would do, but thank you for asking!

@Andrea Diaz Congrats on your journey so far, 100k is a lot of money!

I think first off, IMO you need to decide two things for yourself.

1.) Why do you want to invest in real estate? 

2.) Do you want to be an active investor or passive investor?

Active: Finding the deals, underwriting them, putting everything together, executing the biz plan and managing the asset(s) afterwards. Passive: investing with another group and relying on them to all of this and be good stewards of your money.

I'd love to hear your specific goal for this 100k to better give my opinion. Nevertheless, I wish you the best in this new adventure!

@Nick DiFinzio

I'm sorry for the loss of your relative, good on them for being great with their finances. Do you have any consumer debt? (debt that doesn't result in more money? Cars, credit cards, boats, bills etc.)

If you do, I would pay that off, then take whatever is left and place in a high interest savings account until you find a property, I use Marcus by Goldman Sachs. 

Next decide if you want to be an active or passive investor in RE. Once you've decided that, if active, find a deal that makes sense and do it, IMO, multifamily is more scalable than SFH.

If passive, find sponsors and vet them.

I hope this helps!

Hi @Ryan A Shumaker thanks for the question

What market are you in?

I would say sunbelt markets are seeing lower COC than other markets. I'm in the Midwest we like our deals to at least have 6% COC year 1, and moving toward 9-10% by year 3-4.

However, I don't think return metrics are necessarily the most important part for an investor when deciding on a sponsor. 

I hope this helps!

@Ian Hogan 

My apologies, I feel like all of my responses on BP are "it depends" but unfortunately I have never heard of, or received financial advice that was broad spectrum useful across everyone. (Maybe live below your means ;)

It depends on what the person wants, and what the goal is. If the goal is just "to make as much money as possible" then go 100% into RE, crank up the leverage, and pray nothing goes wrong. What is your appetite for risk? I'm not saying RE is inherently more risky than stocks but anytime you borrow money, there needs to be some element of risk taken into consideration.

I'm sure everyone has heard the saying "concentration builds wealth, diversification preserves it" if this saying was a scale from 0-100 I think each person needs to decide for themselves where they fall at. Personally, I'd consider myself less of a risk taker than the average investor. 

@Steven Rosenfeld 

"The hands-off investor" book was recommended to me from a person on BP, and I thought it was great! I don't know anything about Goodegg, but while you're vetting sponsors, check out Gray Capital, I'm totally unbiased but I hear they are pretty good ;)

@Deborah Fung

I'm really sorry for your loss. 

I think there are a lot of options. IMO I think you should decide how much time you want to dedicate and or how many headaches you want to go through for your RE investing. Do you want to manage the Texas property and deal with the tenants when you're 800 miles away? It's fine if you do, just make sure that is what you want.

I would not get equity out of your house to buy a property, I think you should do whatever will bring you the most peace. Whatever you decide, my only advice would be to not rush into anything thinking that you need to do something super fast.

I hope this helps a little, again I'm sorry for you loss.

Hi @Kaitlyn Robinson

Great question, I think being on BP in the first place is the best first step you could take! I can only speak to multi-family investing, but I just finished Brian Burke's book "the hands off investor" I thought that was great! However, its more geared toward passive investors and syndications. (I listened to it on Audible) The other two books I could recommend that I have read are "what every real estate investor needs to know about Cash Flow" by Frank Gallinelli as well as "the definitive guide to underwriting Multifamily Acquisitions" by Robert Beardsley. I've also followed the YouTube channel Break into CRE for a long time.

I hope this helps!

@Julia Taylor I'm with @Taylor L.

If I had 1M cash and no income, I would invest with syndicators for cash flow. 

This would be my plan because this would provide great income (tax sheltered) and require next to no reoccurring time commitment for me.

@Mike Dymski

Thank you!