Originally posted by @Cody David:
TLDR: Student & Employee looking to passively invest 25K by June 2021 for long term (appreciation focused, cashflow unimportant). Currently heavily considering Turnkey investing. A) Should I consider anything else in Real Estate Investing for passive long term? B) Which Turnkey companies should I go with? (Personally I like Doorvest's model) Thank you so much for your help and time!!
Who am I: Hello All, My name is Cody David, I am 20 years old currently going to SDSU (living in San Diego, CA) and employed as a marketing specialist. I would like to better establish my career (keep the main hustle the main hustle). I have been saving up for a long time and investing what I can into the stock market through ETFs, REITs, and REIT ETFs. After listening to Brandon & David, I see that Real Estate is a powerful way to set up a safe future for me and my family. We have never been wealthy and I am doing all that I can to change that. This is my first step (my truck vacuuming I guess) to real estate investing. I just created my account and thought that I would reach out to this wise community for advice.
Numbers: I currently have 25K saved up that is ready to go into Real Estate and my goal is to be invested by June 2021. As a full time student by day, and full time employee by night, I have very limited time to manage a rental property, but I would like to put these savings to good use. I already have an emergency fund and losing this money will not hurt me as my W-2 job will keep me afloat.
Goal: After listening to the podcasts, it seems like turnkey investing would be the best fit for me. However my plan is long term appreciation and I understand that plenty of turnkeys do not give you that appreciation as their main focus (typically) is cashflow. I am open to start the process of looking for a partner who needs funding as that seems passive as well.
Questions:
A) Should I consider anything else in Real Estate Investing for passive long term? (Syndication, Real Estate Fund, More REITs, Funding a partner)
B) Which Turnkey companies should I go with? (If you believe that this is a good fit)
For each and everyone of you, thank you for your time in even reading this post. I understand that your time is important, especially if you are on this website, and I truly appreciate even a simple comment that will contribute towards a better life for my family. Please reach out at anytime.
Your post doesn't make sense since you state you want to invest by June 2021 when this is already August 15th.
There are many different types of investments you can do with real estate and I have a few suggestions. You can purchase a property that does not require a lot of your time to manage, have 100% control of your money, have 100% control over every decision made and 100% of the profits belong to you, or...
you can give 100% control of your money to someone else, have that person have 100% control of your money, have that person have 100% control over making decisions, pay that person a handsome fee to have 100% control over everything and you will get only a fraction of the profits.
I say; never ever give someone control of your money. I invested $1 million two times and lost $2 million by investing in two K-Mart shopping centers and one other real estate partnership back in about 1980 to 1985 and both investments were a nightmare with lawsuits where my attorney fees were more than $50,000 for each deal.
The problem when you give your money to someone for something like a turnkey deal is most people taking your money are very friendly before you give it to them and not so friendly or willing to answer questions after they have your money. I always like to think the reason is because they are on too busy on the phone taking money from other people.
It is virtually impossible to know whether the person (or company) you are giving your money to will do a good job. Go to a real estate club called FIBI (For Investors By Investors) if there is one in your area, or watch their videos on youtube. This is the only honest real estate club I have ever seen and all the REIA clubs bring in dishonest snake oil salesman who screw their own members out of thousands of dollars with the crap they sell. I get so mad I yell at the presidents of the meetings and write them letters.
If you go to a FIBI meeting, or watch their videos you will see that even the most-experienced real estate investors admit that they make majorly bad decisions when doing turnkey deals, syndicated deals and flipping houses. It is impossible to have someone else invest your money in real estate and $25,000 is a lot to lose, regardless of whether or not you say you don't care and making that statements says a lot since every dollar counts and if you lose that money and save another $25,000 then $50,000 can get you into some type of property you can own and have 100% control of.
Don't be pumped up and anxious to jump in, have to cross your fingers and pray that the person you gave your money too will do a good job. I will bet that more deals fail than produce the results promised.
The highest profits you can earn with the least amount of time you spend to manage is 4-plexes, or more units. You can often get into a 4-plex for the cost of a house. Your earnings are almost exponential and the investment is bulletproof during market corrections since during market corrections multi-unit properties actually increase in value while single family homes depreciate.
Don't burn the candle at both ends and someone like yourself reminds me of the same scenario I see over and over. You are going to college, working at night and you are like many people working your butt off wanting to invest your money and you think you don't have time to manage your own money. So, you give your money to someone you think you can trust and you lose your money. I hear this story over and over and over.
Save your money until you have enough to get into a 4-plex or more units and control your own money.
It is my belief that most people will not and cannot save large amounts of money. With that being said starting on a single-family house today and then buying another one in the future could make a better move for most people in my opinion.
