I am wondering what everyone thinks the most important things to concentrate on are when you are just starting out? Some examples would be creating working relationships with lenders, marketing, finding a good Realtor or property manager. I want to hear everyone's ideas and experiences on starting out and what the most important things ended up being.
I would say:
1) Learning - Read, read, read. If you are really just starting to find out about this topic, you need to get a good grounding in all aspects.
2) Figuring out what you want to do - Buying cash-flowing rentals? Fix-and-flip? Developing? Apartments? Mobile homes? You can't do everything, so you need to figure out what works where you're going to work, and what appeals to you.
3) Finances. Get your finances in order. Pay down debt and accumulate some cash. If that's difficult, figure out how to do deals that don't require cash (wholesaling, subject to, lease options.) But realize this will limit the details available to you, and will create more risk since any hiccup will be difficult to handle.
4) Meet people. Join your REIA, talk to lenders, mortgage brokers, realtors. Go to open houses.
Take you time. Don't just jump in and do a deal for the sake of getting something done. Not saying to wait and analyze for ever. But, learn the business, learn your markets, make some contacts, and start with a GOOD deal. A saying I like is "opportunities are easier made up than losses".
After Wheatie's excellent suggestions, understand your market. That is, is your area growing or contracting (I mean population + job market, as well as RE prices). If your area doesn't work for you, what areas would?
Thank you guys so much for your answers. I am a big fan of marketing - it's a lot of fun. What are some of the best local marketing tactics that you have had experience with. What works?
All of the above is important, but IMHO, if you do not understand the mechanics of how a building and it's infrastructure work, you are not in a very good position to determine the condition of a prospective property, nor can you really evaluate what others, including your contractors and other advisers are telling you. You have no way of determining how long a given task should take, or what is, or is not, a reasonable obstacle in the performance of the task. Not understanding what the possible root problem is when looking at a particular situation can be disastrous, and costly.
If you do not know, for example, how a typical toilet actually functions, and the actual cost of typical replacement parts (under $20) and what is involved in replacing them (less than five minutes work), you might not be making the best choices when repair is needed, or when renovation estimates are calculated. This will have a dramatic REAL WORLD effect on your investment.
The marketing forum on Bigger Pockets has alot of valuable ideas from experienced investors. I have noticed that not all systems are right for every individual. You should investigate all of the different ways to market for your area of interest, and match it with your finances and personality. Also, of course, it is important to do marketing that actually makes your phone ring!
focus on the long term.
be willing to walk away from a deal.
this is not get rich quick from your living room plan.
you have to go out look at deals, talk to people , read, trial and error.
start small.
Another thing to add to the excellent list above is making embarrassing offers. If your offer doesn't make everyone involved embarrassed then it's too high.