Is it a good problem to have?
For many Bay Area people looking for a single family home in top school district, 200K is barely the down payment you need to buy your own home. But assuming you have your primary residency or you are worried about the bay area market as a whole, here are some suggestions from the forum:
One investor from IL says
One investor from FL says
1. 30% or $60k in REITs. They have a rate of return much higher than a savings account, percentage depends on the trust, less risk than stocks, and no flipping or management involved.
2. 30% or $60k – Purchase a SFR or CONDO in Broward Cty FL to LEASE-OPTION to a tenant that wants to purchase YOUR property, not just rent it. They will pay you monthly cash flow. The option terms negotiable, a portion of the rent will go toward your tenants future down payment to purchase the property 3 – 8 years later. Tenant maintenance CAN be part of the deal.
3. 40% or $80k – Vacant Land Investment. It is a buy, hold, and WAIT strategy, but VERY lucrative. Investors scoop up & sell the land early, pre-development. The big developers might take a few years to several years to come back and purchase, but when they do . . . this is when you cash your check.
Investor from Texas
I can answer you question with what I DID with 200+k.
Bought a small apartment from a mom & pop RE, in a great location.
Spent another 90k out of pocket for the rehab.
Filled with qualified tenants and cut expenses almost in 1/2.
Now it cash flow +/-15% and is worth almost double what I paid.
In a another year, refinance some cash out and repeat the possess.
Investor from Alabama
I would buy 8 $25,000 houses and have them rented out through section 8 for at least $800.00 each bringing in over $6400 a month. I would be patient and look for 3/2 or 4/2 houses that need a little work in a decent neighborhood but can be purchased and fixed up for under $25,000.00.