Currently my partner and I have combined about 200k in liquid funds. I also have excellent credit.
Based on today’s market, what is the best strategy now? I am thinking about making cash purchases of distress homes, rehab them and rent them out… Hopefully purchases can be made with deep discounts with our available funds.
I am looking for the ‘path of least resistence’… I am quite busy at work and family commitments, and therefore am not interested in spending all my time looking for deals. I am looking for the easiest money out there, leveraging my good credit and cash positions. There are other biz ventures I can persue if there are no easy bucks in RE today.
Real estate investing takes time and effort. The money earned from real estate investing can be rewarding but is rarely “easy bucks”. The return is more often directly proportional to the time and effort you invest in the business. If you need an investment that requires no time or effort and “no risk”, buy bank CDs or treasuries.
Real estate is not a quick and effortless road to riches.
Not knowing what your investment strategy is makes it tough to give you anything specific. Based on what you’ve shared, you may be well served employing the service of a real estate agent that specializes in analyzing and buying distressed and bank owned properties. Doing so will save you a ton of time. I personally think it will improve your odds for success. In my backyard smaller commercial banks are willing to lend to very solid borrowers. In fact, I think they would prefer you to show a strong personal financial with solid cash reserves. Leveraging your good credit and employment is smart. I would encourage you to think in terms of millions. Creating just modest cash flows with real estate means leveraging big numbers. Another source of easy money is the good ole conventional mortgage (ie- FNMA/FHLMC). You could use this source to get started. Another often asked question is whether to buy individually or as a biz. Initially, the individual approach will gain you access to more financing options. This might change later especially if you want to work with a commercial lender.
From what you posted it sounds as if REI is definitely not for you. If you are busy with work and family then managing rental properties will most likely eat into your other obligations and cause you much resentment. If you are liquid 200k you might look into doing some Equity Based Lending to make a nice easy profit. If you could churn that 200K twice a year as an HML you could make a nice return on your money.