I am in the fortunate position of having $100,000 in a money market account that I am contemplating using for a real estate investment (or several).
Briefly on me so you know where I’m coming from: I’ve recently moved overseas (to Germany) where I’ll be for the next couple of years. Because I sold my house in the US and get a decent expat package I’ve got a good amount of cash to invest. Most I have put in the market (index funds mainly), but I’ve left myself $100K to invest in real estate. Initially I was thinking rental properties, but that’s difficult with me being overseas. So now I’m thinking land.
Question is: where to buy that will still appreciate? I’m thinking SE, in part becasue I will be there in September (Hilton Head) and would like to buy while I’m there. Florida continues to be an appreciating market and is one area I’m thinking about - any ideas where to buy there? Any other suggestions in the SE?
Any advice to somebody like me who is a novice - things to stay away from, etc?
If anybody has thoughts on the above I would truly welcome the advice. If you’d rather PM me that would be great as well.
It seems like this 100K is “burning a whole in your pocket”. I would invest it and use as little as possible to begin your trek into real estate investing.
IReal Estate investing is based on the premise of using other peoples money to make money.
Do some research, deep research, before you drop a large amount of money on any investment.
Thanks Mark - my wife is telling me the same thing!
I’m not in a hurry so I will definately do my research - that’s why I’m so glad I found this site - I’m learning a lot but the more I learn the more questions I have!!!
hilton Head is a bit pricey to start with for 100K in my opinion. Secondly even if you are only buying the land for appreciation purposes why would you pick that area? I believe it will rise BUT not at an alarming rate nor woudl it seem feasible to INVEST and wait as it appreciates at say best 10%…Wouldnt you like better than 10% a year??? I know I try to aim at 30% minimum per transaction for my investors. I try to have 3 a year done for them. This is only small purchases though usually running 30-50 per buy and sell outs at 60-70K. They pay me and all expenses and usually walk away with 20-25K each time. I live in SC so I know the area. If you would like to invest in SC around this area and are looking for rentals I would be willing to hunt for you some deals and manage them to be rehabbed and flipped or I could manage the properties for you with an agreement in place and have funds put into escrow so we both know our paydays will be set.
I really think Texas is another market you should look at since it is steady not a boom like FL NY or CA but a steady climb and many guys here are from there which would be of your benefit too. If you have that kind of cash available find a birddog, property manager or one who is willing to work with you and you can get along with the same style of comfort levels and investment strategies with a plan inplace before jumping the gun.[/b]Have your exit plan in stone BEFORE BUYING[b] I am sure there is many here who can help lead you in a better direction as check the forum for birddogs in areas you see a growing rate and check population status of last decade or so for a positive growth rate better than 4% minimum or above the state average at least. Then check schooling systems comparable to federal and state levels, crime for your area. Buying land not necessarily means buy today and it will go up in 5 years at a good rate.In that same time period you could be ghetto or worse declining or worse kicking yourself for not trying a few fix and flips and squeaking out a couple marginal deals and a few gold ones to average out well above the growth of land appreciation. Dollar cost averaging works very similiar in the principle basics of compound nterest whether land real estate or money market funds or IPO’s what have ya.
Taxes is another concern… check into an LLC or “s” corp or “c” corp which wuolld be ebetter as well as foreign investment strategies. Having them at a corporation it would be held and taxed at corporate rate and you could write off some of the investment since your in Germany and investment being in USA if you are not the main owner of the corporation. Have your corporation put shares of the majority into a trust account or living will to your heirs and you hold minority position and controlling voting rights by voting those shares in trust. That would allow a write off on your investment and let you invest at a profit and the corporation pay the tax at its rate for the profit gains but since you have management and expenses for corporate it will be a lower amount because of expenses(write offs) daily business expenses.
I am no expert just a few thoughts which I am sure more experienced guys could with better advice and suggestions than I have.
I am NO ATTORNEY NOR TAX CONSULTANT and this should be deemed as suggestions and not legal advice nor will I be liable if incorrect in any form in all or part thereof.
In fact If you are looking for a better return do owner financing of a property for someone who you can get to sign and agree with a 12% note and balloon it at 1 yr…
Mike - thanks for your note. One clarification - I’ll be in the Hilton Head area only because I’ve got family there and will be visiting in Sept. I wasn’t planning to buy there as I think you’re right about the slow appreciation. I’m definately looking for better than 10% per year. I’ve got a chunk in the market that brings me those returns. This is my attempt to do even better…
With regard to your other ideas - I’ve sent you a PM.
Corey,
My partner and I live in the Upstate of South Carolina. We purchase and rehab single family homes and then let realtors find us a buyer. We are currently working off of hard money until at such time we can become our own bank. This would only be done through a legal contract with an attorney to ensure the safety of everyone involved.
Steve
