I'm Scared to Invest in Real Estate in a College Town Right Now
Anthony is in Kansas City High Anthony. Welcome to the Dave. Ramsey show. Hi doing great. How can I help? I have about a half million dollars in my checking account and I have had it in there for a couple of years I'm trying to figure out exactly what to do with it. My plan was to use it for real estate. But the real estate market got me a little spooked right now while or. we live in a college shirt close to a college town and. the market there they've built so many brand new complexes in the last. Ten Years Nobody's going to college. Okay. I'm with you exactly the enrollment rates are going down you know so I'm a little bit Leery of that. So what town are you at all? I'm Manhattan. Kansas Yeah, okay All right yes. You're far enough away from Kansas City that you're probably not investing in. Kansas City. Correct okay, Anthony holder you. I'm forty five. Okay. You've done a great job. Yeah. Are you planning to stay Manhattan. That depends don't necessarily need to have a hobby farm. I'm I'm an electrical contractor by trade. But my my real estate holdings I have a couple of rental properties to, but I have about a million and a half in real estate that's all paid for. about one, hundred, thousand in cash five, hundred, thousand in my checking. about four, hundred, thousand other assets like. Crack loaders tractors. You're. A. Stud. Done. So proud of you. It's got to feel great man really did it and I'm assuming you did all this start assuming you to all the starting from nothing. For nothing inherited nothing way to go well, here's what I would do if I, woke up in your shoes and I find myself in similar situations from time to time. I'm between real estate deals and I need access to the cash when I get ready to do the next real estate deal. That's where I find myself. It's where you find yourself because you're not going to drop that half million in Manhattan you've made that decision. I'm not going to recommend if you've listened to me for more twenty minutes, you know this to be a long distance landlord. and. So what I'm GonNa end up doing is just parking this probably in like an S. and P. Five hundred. you know a no load fund there's no commissions and just ride the market with it a little bit while I'm waiting to decide what I'm GONNA do. and. One of two things will happen. One of three things will happen. You decide to stay in Manhattan and the market get soft as you predict. So you will not pull that money out in buying Manhattan. So you're probably going to turn and invest in some other vehicle for probably some mutual fund or something number. Two thing that could happen as you move and you're living in whatever Kansas City and you got a great market to invest in. Then, you pull the money out and you invest it then what was the third thing that could happen. The third thing could happen would be Manhattan back the college market firms back up and you feel good about investing in Manhattan again, pull the money out there s and P and invest go so your parking it until something else moves another variable moves in the situation. But checking accounts not okay. Yeah. I realize that it's been but you know how it is Kinda fly. And I'm sure your bank is reaching out blowing up your phone with all their ideas and thoughts. Real helpful now. Drysdale's on the line. There's a saw ball mister guides deals on the line. There's a fourth option you may begin to look at something that gets to be on sale where you've got someone that has to sell or is looking to sell, and now you've put yourself in a situation to start to have some conversations about potentially buying that that could happen as the market. In Manhattan that's right. that somebody couldn't quite survived the turn and it's making an upward turn and you're comfortable with it that could result in a really good for a great deal. Yeah. That's that's a very, very good point. Dr. John Loney is. One of three, thirty, two degrees he's got he's got more degrees than a thermometer is in higher. Ed. And he's talked about with you and I and a bunch of US behind the scenes and even some what on the air The to the extent that. Because of the student loan debacle and because covert scenario by home, they realized These colleges are trying to charge just as much sitting at home I'm not getting like the college experience. I don't see any ivy on the walls here at my house. So to those two things hitting together are accelerating p the demand for college degrees. On campus living college degrees, they're accelerating that demand dropping right been dropping. Student loan the covert thing is pushed it over the edge. So, we are seeing some things like he's describing a college town like Manhattan, which is what Kansas State. Of Kansas, state and So you know we're seeing so many smaller towns where the economy's driven by resoluteness. Affecting their economies it really is a lot of those around America.