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Hello everyone and Welcome to another
episode of Selling Greenville your
favorite real estate podcast here in the
lovely City of Greenville South Carolina
I'm your host as always Stan McCune realtor
here in the upstate you can find all of
my contact information in the show notes
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all right today we're going to do a
short little episodekind of thinking
outside the box about real estate
investing because I hear people
frequently come to me and they say hey
Stan I've got you know 20 30
$40,000and and I want to to invest
in real estate how do I do that well
it's really challenging to invest in
real estate with 20 30
$40,000 even if you are able to get
pre-approved for financing for for a
rental property for instancebecause
right now there's like nothing on the
market for 2030 $40,000 so even if you
are able to purchasea rental
property with financing you have to put
20% down almost alwaysand then you
also have closing costs which as I'm
recording this
sellers still are not willing to pay
buyer closing costsnow we know that
that could very well change as the
market shifts but that's the current
state of the marketso you have to
consider okay that would mean that you
could not P if you've only got let's say
$20,000 the the most expensive rental
property you could purchase would be
less than $100,000 because you'd have to
do the 20,000 plus whatever down payment
plus whatever closing costs so the
20% down payment plus closing costs
so you'd be looking at properties that
are probably $80 to $90,000 and there's
not a whole lot of rental properties
available for $80 to
$90,000so we need to think a little
bit more creatively when it comes to
quote unquote real estate investing when
you've only got a little bit of money to
invest and so I'm going to again think
outside the box here on what are some
things you can do that are kind of
indirectly investing in real estate now
this is not Financial advice because I
am not a financial adviser I'm not
licensed to do that I am a realtor
and so I do not give anyone Financial
advice and do not take this as Financial
advice pleaseenlist a financial
adviser to help you make good financial
decisions that will be the way to go for
you but these are some
informationalthe these are things
that we're putting out there for
informational purposes only and then you
can discuss them with your financial
adviser as you
want but these are all things that I
have considered and or have done over
the years myselfso the number one
thing on my list of how to invest in
real estate without actually purchasing
any
propertythe number one thing thing
is to make value add improvements to
your rental properties this is something
that shockingly not very many people
think about because you H if you have
rental properties and they already have
tenants in them or maybe the tenants
leavea lot of times I see landlords
and landladies have this mindset that is
it's such a scarcity
mindset they just want to do the bare
minimto their rental properties but
guess guess what investing in those
properties making those properties nicer
that is a real estate investment that is
adding value to that property for when
you sell it and also adding value to
your current or future tenants that is
potentially addingadditional rental
income and so it is a sneaky way that
it's it's one of my favorite things to
do there's also some again you should
talk to your account about this if you
need more information but I understand
from my accountant based on my financial
situation that there are some tax
benefits to doing this as welland so
that is somethingto really consider
if I have just kind of some extra cash
sitting around and it's like I don't
want tome personallyif if I'm
not in a position where I want to you
know invest in other things outside of
real estate but I also don't you know
have enough cash or maybe there's just
not enough opportunities out there
for me to be able to purchase something
the that that's those are situations
where I love to just look at my rental
properties and be like okay what can I
do to my rental properties what needs to
be done to these properties what have I
kind of been setting aside and so I I've
got properties right now that in the the
past year I've replaced siding on them
they they didn't need the siding to be
replaced but they looked they looked
really bad you know so I replaced siding
I replaced flooring even the floor some
of the flooring didn't necessarily need
to be replaced I did all sorts of of
different things like that because it
was like this is a long-term investment
and I will get my money back for what
I'm doing here like this will help me in
the long run with these properties so
make value ad and that that's a key word
value add improvementsobviously if
you're just over improving your rental
properties that's not a good thing you
do not do that you know don't go into
your super you know low-end rental as it
wereI'm being factious but don't
don't go into a property that you're
trying to to rent out for $300 a month
and put in quartzcountertops or
granite countertops or whatever the case
may be don't go in and and do that just
do what needs to be done improve the
value to the extent that it actually or
or improve the property to the extent
that it actually adds value but make
sure that you don't over improve so that
you're just paying more money than you
need
to the second thing on this list is very
similar to the first and it's one that a
lot of people don't really I feel like
think about when they think about real
estate investingbut I considered
making it the first thing on the list
because it has some very tangible
benefits as well and that's make value
add improvements to your own home like
if you're improving your home you are
essentially investing in the future of
your home so you can make improvements
and and again not all improvements are
going to add value and most improvements
don't add dollar Ford dooll value but if
you're strategic with your improvements
you can make improvements that add value
to your home that are an actual
investment
but remember your home is where you
live and there's more to it than just
the investment side of it like adding
taking that excess money that you have
and improving your home helps your hes
value but it also just improves your
everyday life and so it's worth doing in
in on multiple levelsand so that is
an underrated way of of thinking about
don't think about okay I'm just throwing
money awayyou know doing this
renovation or doing that you might be
it's very possible that you are just
throwing money away if you make bad
decisions bad design decisions or if you
over improve like I've already said
but if you improve strategically let's
say that well here's a good example my
first home that I lived in had a very
choppy floor plan and so my wife and I
we just we completely opened up the
entire main levelgutted the kitchen
put a nice Island in there and it
completely changed the entire feel of
the
home and made the home dramatically more
valuable to bootthose are the types
of things that I'm talking about here
now replacing one Granite with another
form of granite that's just a little bit
nicer no that you're not going to get
dollar for dollar anywhere near near
what you're putting into the granite to
replace itbut maybe that's not an
investment or a good investment but
maybe that's something that you want to
do that's still better than just
throwing the money away right going to
Vegas and playing crapsso I feel
like real estate wise if you can't
invest there are a lot of good look
around your house there are a lot of
good opportunities to make investments
in your house there might also be and
and I hadn't even really thought about
this When I Was preparing for this
podcast but now it'syou know my mind
is going there remember as well that
there are a lot of homes that we live in
have appliances that are 15 20 years old
and these appliances are extremely
inefficient in comparison to more modern
appliances you may consider upgrading
your appliances and upgrading your
appliances will
also in the in the short run make your
home more valuable it makes your
everyday life more enjoyable if you get
nicer appliances and they're more
efficient so you're paying less per
month on the energy costs potentially so
that's something to consider as well
number three on my list and this might
be implied with the other two but I
guess perhaps I'm cheating here to to
have five on my listbut finish
unfinished areas and this could apply to
either your personal home or your rental
propertiesbut if you have any
unfinished areas finish them if you have
an unfinished basement you can add a lot
of value to your home by just finishing
the basement that is a real estate
investment if you have an attic that can
potentially be accessed from down below
and it's high enough to potentially
finish it and have like a bonus room
that's a great way to add value to to
your propertynow again it might not
be dollar for dollar and it might not be
square foot for square foot from the
standpoint of of square foot value in
your neighborhood a lot of appraisers
around here don't like basements they're
not going to give full value for a
finished basement so you need to keep
that in mindbut finishing unfinished
areas isjust a fantastic way the
only reason why this isn't higher on the
list is just because it's probably only
a handful of my listeners that even have
that opportunity to finish unfinished
areasbut actually this is one of my
favorite things to look at when I'm
looking at potential investment
properties do do they have unfinished
areas those are massive value ad uh
opportunities for properties and if and
if you can finish them and you you
finish them well that's going to end up
being a great real estate investment you
can you know finish a a room for
depending on various factors it might be
20 $30,000 so if you've got that kind of
money sitting around you're not going to
be able to buy property but you can add
value to the property that you already
havefourth on my list is lend some
of your money to a reputable investor a
reputable real estate investorI know
several of themand I've had several
people lend me money over the years
because they know that I'm reputable in
terms ofmy own real estate
Investments but that's a great way to
kind of passively be involved in real
estateyou're giving money to a real
estate investor who's paying you a
certain percent back maybe it's 10% per
year 12% per year something like that
and then instead of just having your
money losing value as it's sitting in
the bank you have it with someone that
can will actually do something with it I
think that that is aa fantastic
optionand and that's the kind of
thing where if you're looking to do that
type of thing I can connect you
potentially with some people that could
that could use some money I I can't
warrant that they will
be 100% reputable I can only warrant
myself in that regardbut I can
connect you with some peoplethat I
know that are frequently in investing
that I think that I would trust and then
you need to do your own due diligence
and your own homework with them
number five on my list and I I said this
would be this would be a short episode
and and it is going to be shorter than
normal number five and last on my list
spelled re e t and it stands for a real
estate investment trust now what is a
Reit and have I personally ever invested
in them all right I guess I'll ask that
I'll answer that second question first I
have never personally invested in a real
estate investment trust why because I
invest in actual real estate that I can
tangibly hold on to but if
I only had 10 20 $30,000 and wanted to
do something real estate related this is
an opportunity that you might want to
consider that you might want to look
into it essentially treats portfolios of
real estate like stocks and soand
and I'm no expert in this it's best that
that like I said that you do your own
research talk to your financial adviser
about itbut it it's a way to trade
real estate without ever owning any
property and so that could be an
interesting option for some of you that
maybe you've never heard of it maybe
you're not familiar with itbut there
are several of those out there and there
might be some good opportunities like
that just as a way for you to be able to
put your money towards Something Real
Estate related but without actually
purchasing any property
yourself that's number five now I have a
freebie on here that is something that I
want you to not do and this is also not
Financial advice this is just St saying
please don't do this do not get a time
share do not get a time share don't do
it they are they are Ripp offsI I
know some people that are very happy
with their time shares and and if you
have a time share and you're happy
listen I am happy for you and I am right
there with you you know go to Cancun uh
you know one week every year and enjoy
your time share go to Orlando one week
every year and enjoy your time share
whatever whatever the case may be but
man there are so many better things that
you can put your money towards
thanthan a time share they they
claim that your ownership stake in a
time share is something that's valuable
I personally have never seen that be
true I have never seen someone be able
to go sell their their time share stake
and make moneyI'm not super
knowledgeable about that world but what
I am knowledgeable about I'm pretty
knowledgeable about traveling I travel
not a ton but I I've done enough of it
over the years I know a little bit about
itand I just the numbers do not make
sense to me so if you've got 10 20
$30,000 I'm just asking you think do
something from from my list before you
go and and try to do the time share idea
pleasetalk to your financial adviser
about that I'm fairly confident your
financial advisor is going to agree with
me on that so there you go that's it if
you have some money sitting around you
want to invest in real estate not enough
money to be able to purchaseproperty
here are some ideas here are some things
that you can do and hopefully that was
helpful for some of you guys I
appreciate you guys
listening we have a lot more content
coming this summer I'm going to still
produce content for you guys every
single week even as I'm traveling a
decent bit this month so stay tuned I'm
looking forward to it I hope you guys
have a great rest of the week and we
will we'll talk again next time
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