Got some $150k liquid cash. Thinking of buying rental property vs invest in stocks & mutual funds? As we live in California with $150k down buying a rental property in this market is a good financial decision? Already own a home. What about buying a franchise like UPS? As we have GC no immigration issues. Any other ideas? TC:200k
$OPEN
Lol
Judging from your question, I assess that you are not well versed in investing. So, for someone like you, I recommend a target date retirement fund for this lump sum. You should also maximize 401k, 529 and other tax advantaged account, as you live in a high tax area.
Everyone starts somewhere. Why can’t OP invest in real estate?
Sure. But they learn how to do real estate investing by reading serious books. His question tells me he has minimal knowledge. He can get lucky and make money from real estate but it is not likely. Investments are based on probabilities, not by playing casino.
How does buying a “rental” property really work.. How easy (given you have $150k-$200k) is it to actually find and buy a property and be cash flow positive with the current interest rate?
Getting a mortgage for a rental property with $150k as a 20% down payment with 6 to 7% interest does not work. No one is going to be renting it from you for anywhere near the 7 - 8k mortgage payment it will be and you will be underwater for several years in terms of cash flow. Do not do this.
Exactly. Even if you buy a $475k property in Sacramento and put $200k down.. the monthly mortgage is still ~2.4k! Who will rent it for that much in Sacramento?
Franchise sounds interesting. But dont you have to put a lot of work in it?
Yes. I was thinking something simple which is easy to manage. Like UPS store etc. hoping I could find a first job which is not so stressful and provide enough time.
How much is the roi on something like a ups store?
150k in cash can only get you a 500k$ rental property. Is there anything in California ( at least where you are) at that price?
What is your net worth and how's the rest of your portfolio invested?
Shiba
Just curious - how are rentals out of state managed by a property management company?
Get out of state rentals. Check out renttoretirement.com and REInation.com. They are perfect for someone like you. With 150k you could easily get four cash flowing rentals. Feel free to PM me
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You can become rich with that if you know how to invest it
You can become rich if you know how to invest any amount of money