I have a friend at the gym who says he's interested in investing up to 60k. He got excited after a close friend sold some land to a big softdrink company for of course a ton of money. Sounds like he just wants to speculate on a lot and hope for later. I'm reading alot about investing in quads or commercial rental and was wondering what investing ideas I could give someone like this. he doesnt want to have alot of hands on involvement, but I was thinking I might ask him if he'd be interested in a quad or something similar, and have a managment company run it. Seems a better deal to me but what do you guys think?

A handful of comments comes to my mind:

Generally land has little or no management to own, but unless he is buying the entire piece for his $60k, he will be paying a mortgage on it every month with $0 income to offset it (where as a rental property has tenants that offset some or all of the mortgage).

A rental property is always going to be more work, even with a management company. Many new investors think they can just turn it over to the management company and never think about it again. I have found that you need to manage the management company. How do you know that they are really working to keep your building fully rented, how do you know they are actively collecting rent, are they maintaning the building (or conversely are they finding work at your building to increase their monthly fee)? Then keep in mind that most management companies will consume 10% of the monthly rent plus 1 entire month's rent per year to re-lease the apartment (plus any repair expense). I always advise my clients to manage each building themselves for at least 1 year so they know what to expect and can keep a tight reign on the management company.

Back to your question.....It depends if he wants to learn about real estate (then buy a rental) or he wants something close to investing in stock (then buy land).

Another alternative is for him to buy a Tenant in Common in a larger real estate property (typically commercial such as shopping centers). He gets the stronger appreciation opportunity, but is a silent partner so he has no management headaches. Otherwise, how about finding a partner for him that will manage it, but also puts in some money.

Lots of options.....

You need to find out what his goals are.

We call what you are describing in the business as land banking.

You buy something and change it's use to increase value and revenue or you can buy land that is slated for progress and hold out for big money.

In other words right now in my area there is a proposal for a 1,000 acre development.It hasn't approved yet but has plans for a shopping mall,office space etc.

I know they don't have all of the land locked up because of the size of it.You can buy around it or buy one of the pieces and have them buy you out.

It's really disgusting how much money I have seen these people make.There is one corner that had an auto center on it that was purchased for 1.2 million in 2003 and the owner was renting out.They recently sold in 2006 for 2.9 million as a developer went in for a 120 million dollar renovation project and bought the corner.They were able to pay the high price because of offset tad money given by the city that is repaid with bonds over time to encourage development of blighted area that have passed there time use and need to be redeveloped.

Land is like anything else,you go in a lowball until you get a good deal.Most people don't know how to shop there land around to developers and businesses.Buyers can pay alot more for the property if they can get the new use approved.

I constantly know ongoing projects for different counties and what's going in,you have to really get a puls on everything so you can explain to sellers if the growth is there of if it's still 1 to 2 years away.

Big companies perform there feasability studies and wait until the area hits a certain revatilization point abd demographics change before going in.

super realtor:

If's so very true that land banking can make you a lot of money.
But the down side is you have dead money there, waiting for the developer to call you. That time could be a year, or could be 20 years. I bought 5 acres of land near lancaster california (one mile from city limit) hoping the same thing.

Which part of georgia do you live? Here in california, I recently went to an investment seminar, some georgia broker is pushing for homes is suwanee and fulton that positive cash flows.
But I don't know the appreciation potential so I did not make the move.

If he's willing to get a mortgage as well as put the $60k in, then you could look for a nice middle of the road home in a nice family neighborhood that he can buy a bit below market value and sell on a lease option.

Those have been the most passive investments I've done. Typically I get at least 2 or 3 years of hassle-free cash flow and then either have to refill the property (because the tenant/buyer moves out) or they cash me out.

Another area that I haven't done much of is holding 2nd mortgages. You have to be careful with these in the current declining market environment, but once things stablize again they should be nice investments.

I live in Cherokee County,Fulton Is about 45 minutes from me.

You really have to know what is going on in the area before purchasing.Depending on where you are you can offset the intial costs before selling by letting farmers use the land,having a timber operation,christmas trees,pumpkins etc.These are more done in the country.If it is close to the city and developed cleared out you could rent it for year round venues.

If you ar euncertain about an area do more research or you could lock up the property on an option contract,during the feasibility and inspection study period you could shop the deal around to developers and investors.You could then assign the contract to them for a fee.

If you want to invest in Ga pm me I have lived here all my life.

find out what his risk tolerance is
also
their are two times not to speculate
1. when you can aford to
2. when you can not