I’ve just got an inheritence of $280,000 and i’m thinking of using it for deposits on multiplexes.
Later on using the rentmoney as deposits on more properties.
What do i need to do first before i can start investing (besides finding the properties)?
“DEPOSITS” on multiplexes or “DOWNPAYMENTS” on multiplexes?
Before you start invsting you need to read, read, read, study, study, study…
When you get done with that , you need to go and read and study and then study and read…
If you start running around with pockets of cash, you will certainly get them picked. And → I mean this literally and figuratively! There are folks just waiting for guys like you – some money and little knowledge/experience.
I recommend that you start slow and small and build up as you gain experience.
My 2 cents…
Did I mention that you should read and study?
Keith
Dris,
Please follow the advice just given. Then don’t tell anyone you have a pocket full of cash. Buy a reasonable place to live (with a small down payment). Then buy an inexpensive rental (with a small downpayment) which gives positive cash flow. Repeat as necessary and as is comfortable. When you learn a bunch about investment return, think about a multiplex.
You have the right idea, using the first properties as a support for future properties. Start slowly and learn. It will work.
Good luck,
Ray
Thanks for the advice guy’s, I will take it slow.
And by “Deposits” i ment “Downpayments”.
I always tell my investors that are crossing over from residential to commercial to look at mobile home parks. We specialize in this type of financing and acquistion…I personally don’t believe there is a better investment out there right now.
Dris,
Thanks for posting.
A real eye opener is to do some mathematical calculations on your $280,000.
For simplicity sake, let’s just round things off to $250,000 and assume a 10% growth factor, (a fairly common yardstick for ROR in the stock market in mutual funds…yet even that requires prudent research).
The $250,000, compounded at 5 years out, grows to 402,000.
The $250,000, compounded at 10 years out, grows to 648,000.
The $250,000, compounded at 15 years out, grows to 1,044,000.
The $250,000, compounded at 20 years out, grows to 1,681,000.
Notice how in the first 5 years your gain is approximately $150,000…while in the last 5 years, (20th year amount less 15th year amount), your gain is 637,000.
So would you first want to run to the stock market and start taking advantage of the 10% return while you figure out how you can do even better with real estate investing?
I wouldn’t. I wouldn’t trust my money anywhere until I was comfortable with where I was parking it.
A Certificate of Deposit is a nice vehicle to park it in…which will give you some breathing room while you do the following:
a) Go to your nearest Home Improvement store and purchase some track shelving for erecting book shelves.
b) Make your nearest public library your best friend. There’s no need to make purchases on books or CD’s that claim quick riches…there are plenty of valuable free sources of information.
I would give yourself at least 6 months to think some things through.
9 months or a year would probably be better.
Think of whom you inherited from. Do them good by being careful in your choices.
A good book that I read was Real Estate Riches, by Dolf DeRoos. It is available in both written and audio format.
In it, Dolf explains the many advantages that real estate has over the stock market or other investment vehicles.
But you have to keep in mind that nobody is going to hand over some perfect piece of income property. You have to hunt for it.
If the real estate books are getting a little boring…read about Sam Walton and how frugal he was. How he and his associates would bring sleeping bags to hotel rooms when they were camping out in New York City when meeting with suppliers.
You need to hone an attitude of buying things on the cheap.
Do you know how copper wire was invented?
Two guys were fighting over a penny… 
Best of luck to you.
-Mike
Good note Mike…
I would recommend that anyone with a windfall take a step back, take a deep breath, and then formulate a long-term plan for the investment vehicle – whether it be real estate or something else. The “due dilligence” is still a requirement no matter the chosen vehicle.
I got a fax from a guy that apparently has $10M of mine in Nigeria…I just need to put $10K in an account and give him the account and the PIN. Anyone want in?
Keith
hey what’s up with that 10m in nigeria :-\
I dunno…but it’s got to be legit – it was on letterhead and came in on the fax!
Keith
Keith, It seems that the “scammer” got you where they want you. Have you ever heard of “money landering”? Do you realize that the terrorists are still trying to raise funds so that they can bomb us again? It’s your money but, $10K will go farther with your RE business.
But “what if” this isn’t really a scam ??? What if they just really need help?
For a small investment I could get an extremely large return.
Oh, decisions, decisions.
Hello Mark, OK, you can spend your money also if you want.
the same type of scam was ran on me don’t believe it
IT WAS A JOKE!!!
Keith
Be careful what you post. It sure had me going…not :ibs:
That’s not the world’s famous “BS Flag” is it?
Keith
The one and only! 8)
I am a Real Estae investor. I live in Florence Alabama. I now live where the average home is 106,000! Two years ago I lived in Santa Barbara California where the average home now is 1.2 million. What I am getting at is this. If you have got that much money to work with, you could do very well with some wise investments. Also investing in a area where you can get a good return on a little investment! I know of properties that can be bought for as little as 8,000 down with the owner financing and give you 10-15% return on your investment. If the owner can get a little monthly interest and some cash down, that could be retirement for him! Everybody wins! Just be cautious. If it sounds to good to be true, look deep in to it!! I would be glad to talk to you. I do not know it all, but Real Estate has made me more money than anything I have done! Good Luck.