though the stock market has made a great run the past several months, i started looking into some other vehicles for investment these past few weeks. after running some numbers and putting everything together, i arrived at looking into purchasing some investment (rental) properties.
there are a few different approaches to investment properties, and they have both short and long term strategies. one of the most obvious is flipping, in which you buy a place, put in some remodel/rehab work increasing it's value, and put it right back on the market and pocket the profits. to me, this is -- like many short term strategies -- high in risk and potentially high in reward. this is also not my strong suit. i'd have to be able to evaluate and see potential in properties and put in time, work, and money that i think would multiply in returns.
instead, i'm looking at buying for the long term and leasing the properties out. this comes with it's own headaches, of course. you have to deal with "customers" -- in this case tenants and the problems that customers always bring. by my math, by managing the property myself (collecting rent, taking customer calls, etc.), i can flow some cash out of the deal and build equity in the property. not accounting for the fluctuating value of the property, and making some assumptions about maintenance costs, and occupancy, i figured that i could make a decent return on this investment.
we've already looked at several properties with our realtor, based strictly on cash flow analysis. most of these have needed more work than i am willing to put in. am now looking at the next tier of properties, which would flow less cash, but after fix-ups to the first, may end up flowing similar cash.