Welcome to passive real estate investing, the show where busy people like you learn how to build substantial passive income while creating wealth for the long term. And now here's your host Marco Santa [inaudible]. Hello and welcome to another or episode of Ask Marco where I answer your investing related questions. Today's question is a good one and it comes from Billy and Billy says, Hi Marco. Love the podcast. Great stuff for sure. Quick personal background. I'm 30 some years old and live in Vail, Colorado. I have an Undergrad degree in architecture and a master's in real estate and construction management. I have been working for a real estate developer here in the Vail Valley for eight years now. Ever since I finished Grad School, I've been very interested in developing a passive real estate portfolio or real estate values and rent to value ratios and Vail resembled the California coastal markets if not more expensive and in balance. Therefore investing locally is not an option. I feel your pain. I have been doing a lot of research about investing in other markets and agree that this is very possible with the right research analysis and working with the right team.





And you're absolutely correct about that. I understand that buying $100,000 properties is a great way to start, but I'm wondering what you would suggest if you have a lot more money to invest and would like to build a portfolio a little bit quicker. For conversation's sake. Let's say you had $1 million. Do you think buying $100,000 ish Holmes is the most efficient and viable way to go about creating passive income? And are there other strategies you like more in this scenario? Thanks for your time. I look forward to hearing back from you Billy. Well, Billy, I hope you don't mind me answering your question here on the show. Um, I think it's a great question and probably one that applies to a lot of people who are either equity rich, uh, or actually have a chunk, a large chunk of investible cash. So I'm going to give you an answer.

I'm probably going to give you four scenarios here. Um, and again, this is for conversation's sake because there's a lot of variables and here's the thing. It is a good problem to have when you have a lot of investible cash, but it's a great place to be because it gives you lots of options, so it's really a matter of evaluating your options, penciling out the numbers and making objective decisions as to what markets make the most sense and what you can get in those markets in terms of inventory, cash flow, rates of return. What is an overarching theme or question here is what is your overall objective or goal? Are you focused more on appreciation potential? In other words, you want large gains in terms of equity and that's what you're striving for without giving up positive cashflow. Of course, you're going to sacrifice some cash in order to do that in many markets just because they may be more expensive or heated or are you looking for just stable passive income or something in between.

The other thing too, I have to consider here is are we talking about like you said, $100,000 ish properties or our 125 $150,000 ish properties. And I say ish because you know it's plus or minus. I mean I've seen a range and we have a range from 80,000 to $150,000 single family homes plus and then there are the occasional duplexes which almost double that number. And then there are the fourplexes which come close to the 650 to $700,000 price range for a premium higher end neighborhood type of fourplex. So I ran some numbers for you and I'm just going to give you some general scenarios to give you an idea of what's possible really at the end of the day I suggest two things, consider different scenarios and pencil the numbers and look at, look at it like I'm doing here, making some basic assumptions and or a number to talk to one of our investment counselors who can run through these scenarios with you and give you some more color.