So, you’ve got $8,000 to invest in real estate, you’ve got good credit. How should you use that eight grand to invest?

Well, first, let’s do some basic math. If you had to put down, let’s call it 20% on a property—you could buy a $40,000 property and put down a grand. But you’re also going to need some money for reserves and for closing costs.

With $8,000 to invest in real estate, you’re not going to find a multifamily and it will even be hard to find a single family for $40,000.

Here’s the bottom line. If you only have eight grand, you’re going to have to be looking at creative financing. Eight thousand dollars is not an inconsequential amount of money. It’s a good amount of money, but it’s just not enough to independently go put 20% down.

Now, a few options.

1. House Hack
The first thing I would look at is house hacking. If you’re willing to live in one unit and rent the others out, for $8,000, you could find a duplex.

I don’t know your market. So maybe this isn’t reasonable for your market. But if you’re in a market where you can find a duplex for—I don’t know—call it 150 grand. You could put 3.5% down, that’s about $8,000.

I’m not doing the math perfectly in my head, but it’s about $8,000. Right? So you can get an FHA, 3.5% down loan. You buy a duplex; you live in half of it. You rent the other half out. After a year, you can move out. And now it’s just a rental property. In the meantime, you’re living for free (hopefully) because you got a good deal.

So, that’s the first approach I would take. Let’s say, you don’t want a house hack, though.

How do you invest it now?

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