Investment

Real Estate Investing – What Would You Do With a Lotto Win?

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A friend of mine recently contacted me as he had rather a strange “dilemma”, for want of a better word. Although form the UK, at Xmas he was visiting a family in Spain, and while there he and his brother-in-law bought several lottery tickets for “El Gordo” which translated means “the fat one”. Now, the fat one is considered the biggest lottery in the world, and is held every year a few days before Xmas. Although the prizes are not huge, a winning single ticket for the top prize will give you 400,000€ – there are 13 numbers drawn for large prizes, and almost two thousand smaller prizes, making the total prize payout more than 2 billion euros. Needless to say, every year millions of Spaniards sit glued to their TV screens on the 22nd of December at mid-day eagerly awaiting the lotto results.

Now to cut a long story short, Lady Luck was smiling on my friend (I’ll call him John) and his family that day, and my friend ended up with a payout of just over 200,000€ after the taxman took his cut. While of course, this is a fabulous windfall to receive, it is not quite a life-changing sum; maybe it is enough to first enjoy a Greek Isles charter holiday but it is not enough to quit your job and live off your winnings, anyway.

John is now back in the UK, and his dilemma is how he should he invest the money.  For those not familiar with the UK property market, it is worth telling you that in most UK towns for this sum you would not be able to buy a decent house. However, as John is looking for an investment project, it is certainly a consideration to buy a run down place that needs renovating and increase his windfall that way.

John is still thinking about it. He is not sure if he can manage such a project himself, and is afraid the expenses might prove to be more than he can realistically afford. He said he would let me know what he decides to do after optimistically waiting for the UK 49s teatime results – as another few hundred thousand are what he really needs to have a decent amount of money to go into the business of flipping houses.

Who knows? Maybe he is on a winning streak!