Let’s say you have a choice. Let’s say that you’re deciding between building a single $1 million dollar home to keep as a long term investment or to build 10 $100,000 homes for the same purpose. You have a target goal of perhaps $150,000 and you can choose to construct a luxury property or 10real estate investing entry level homes. What should you do and what should you consider?

The first thing you should do is make sure that both types are feasible. Is there a market to flip a $1 million dollar home? No? Maybe you can keep the property and rent it out? Luxury properties in the right market often find rental prospects as business executives move in and out of an area. It’s relatively easy to determine whether or not to flip or rent based upon current market data provided to you by your real estate agent. But if it’s not as clear, you can always rent first then watch the market and sell later on.

That said, what about the lower end? Again, is there a market for such properties? Lower end homes are usually reserved for first timers but can also be a wise purchase for retirees who need to downsize. More people can qualify for the lower end while just a very few can qualify for the luxury brand.

Building a single property should provide you with less project management stress compared to 10 projects but building 10 of a similar fashion should almost be turnkey once the first property has been completed.

Finally, what happens when you want to cash out? With one large property, it’s a single transaction and one bigger payout. With 10 smaller ones, you can pare off one or two properties at a time and perhaps use those profits to build or buy even more properties. The 10 property option provides you with more flexibility as long as there are ready buyers available in the market yet with one luxury property your plate won’t be as full when managing just one new build.