First time, non-tenant investments? REIT, new construction, etc

[JennH]

I've got some equity built up and would like to hear some ideas for real estate investments that do not involve being a landlord. I've been around people in real estate all my life, and lately heard two things: 1) that investing in Southern California is pointless right now, and 2) that I do not want to work with tenants or have a property management company taking a piece of my investment. I've read a little on here about investment trusts, been sent a lot of email on getting involved in new construction deals, and considered some other things. One thing I've ruled out is rehabbing properties, which I know I could do, but after looking into in my area, it seems that the time is wrong (prices are dropping). Any other ideas? I wouldn't mind taking about 10-20k out to play with.

-Jen

[sdhomes]

There are safer investments than real estate right now. The market cycle is downward, and not just in S. California.

[AgentBill]

Can't say much about REITs, but from what I have been learning lately, having tenants is frequently part of investing in new construction, as once you've made your money in appreciation, you may need to hold for awhile to avoid having profits obliterated by taxes. That means getting a mortgage after your property's been built, and you may need to have tenants for awhile to offset your negative cashflow.

Sincerely,

Bill Field
Century21 Results
Lakewood, CA

[NinaLO]

I have been doing a lot of loans for my investor clients in the Austin TX area. See them buying duplexes and new homes. The guy thats buying new homes is selling them with owner financing. Not sure exactly how it works but he says he doesnt have the same headaches as owning rentals. Hope that gives you something to go on. Nina

[AgentBill]

I'd say dealing with a new building would defaintely be a plus in that regard.

[JennH]

That means getting a mortgage after your property's been built, and you may need to have tenants for awhile to offset your negative cashflow.

I take it the idea is next to get rid of the tenants when you get ready to sell?

[AgentBill]

Yes, if you want it to show well and agents to have easy access. If it's multi-unit, then you would want to keep rent-paying tenants in there because that adds to the value of the investment that someone else is taking over.

[coastal]

I'm making money both re-habbing/flipping and renting but it certainly helps being a realtor and finding good deals before anyone else knows about them...

If you can find renters who cover your mortgage payments there is no reason not to rent. I include yard maintenance and service calls in the rent payment and have a third party take care of both.

I collect both rental income and appreciation. My first rental property made enough $$ to pay for my next six investment properties.

I realize you asked for methods other than flipping and renting but both work very well for me.

[JennH]

I realize you asked for methods other than flipping and renting but both work very well for me.

Actually the more I look into things and types of investments that can spin off what I already know, it sounds like I may end up dealing with tenants anyway. Necessary evil to hold long enough to make the most of things, it sounds like.