I don’t want to get old.
I’m not looking forward to hip problems, my eyes getting worse, or needing to take my pills just to use the bathroom correctly. I don’t want the “old person” smell, the frequent heartburn, or the desire to drive fifteen miles under the speed limit. The thought of that life terrifies me.
Perhaps, though, the thing I’m looking forward to least is no longer being the “whiz kid.” Because I started investing so young, I’ve always been the one in my social circles who “is going somewhere.” It’s a good feeling, but it’s not that I’ve done anything remarkable, really. It’s that I’ve done something remarkable for my age. There is a significant distinction there, but an important one. It means, when I get old, I’m not longer doing remarkable things. I’m just doing my job.
If you are bored, (well, hopefully not bored reading this…) and not sitting anywhere near your children (because the language is definitely not family friendly) check out this clip by stand-up comedian Louis CK about growing old. He’s come to the same conclusion as I have:
Why Investing at a Young Age Rocks … and is Hard
At 27, I still have a few good years left to be “remarkable” – but “old” is creeping up; but it’s not just me either, because here is a dark secret: you are getting old too. So, I’ve dedicated the last year of my life to teaching other young folks (and young at heart) how to get into real estate investing, despite some of the disadvantages we have. In fact, let’s talk about those disadvantages real quick:
- Very little money – Let’s face it – most young people are pretty broke. Maybe you’ve got a good job and have so much disposable income you don’t know what to do with it, but chances are – you’re living pretty close to paycheck-to-paycheck.
- Very little life experience – I know, when I was twenty-one I thought I knew quite a bit. I didn’t. I didn’t know anything. Now today, at 27, I think I know everything. I don’t.
- Video games are so appealing – Let’s face it – sometimes all we want to do is play some video games, hang out on facebook, and watch TV.
- Chasing girls (or guys) or chasing kids – From the moment puberty hits, boys and girls of the young persuasion have a strong need to find that “special someone” and spend all their time together. After that, comes the kids that require every waking minute. That doesn’t leave a lot of time for investing.
- Poor credit – College and the years that follow can be rough for a lot of young people, as the schools do a terrible time teaching about financial intelligence. Or perhaps we just didn’t listen. Either way, most of us have needed to wade through the credit card years and will spend many years recovering.
- No like-minded social group – I don’t have many friends who read my writing. It’s not that they don’t like me, or care about me, it’s that they simply don’t care about real estate – and that’s perfectly fine. I’m not bitter. You will probably find a similar situation. It makes it tough, however, to find motivation to get into real estate when you don’t have a community that fosters financial education and growth. (**Special note: if you are an old friend or a family member of mine, leave me a comment below… let’s see who’s reading my stuff! )
So what’s a person to do, faced with all these disadvantages? I’m hoping to help offer some insight on that, being one who has been through it. The following is a collection of the lessons I have learned.
To Start Investing In Real Estate, Harness What You’ve Got
Now that I’ve made you feel bad about all the things that are not going so well in your life, let’s talk about the things that you do have.
Motivation- You’ve already read 600 words of this blog post about real estate investing, so you are clearly motivated. Use that. The older you get, it seems, the less motivated you are. As people get older, they seem to get more complacent in their situation, and no longer shoot for the stars.
Today I had a conversation with a man about how to buy an airplane. Am I anywhere near ready to buy an airplane? Heck no. But I’ve got goals, and I’ve got ambition – and I’m going to buy an airplane, even if it takes me the next ten years of working that plan. This is the power of motivation when you are young. (Be sure to check up with me in ten years and I’ll take you for a ride on my plane…)
Technology- You’ve got a firm grasp on how the internet works, how to handle social media, how to use a smart phone, and how to make a spreadsheet. Even if you can’t do everything – chances are you’ve got a friend (probably on Facebook) who can get it done for you. Use this.
You’ve also got resources like BiggerPockets. Our parent’s generation didn’t have this wealth of knowledge and community – but we do. Use it. Jump into the Forums and ask question. Get into a conversation with a blogger on the BiggerPockets Blog. Technology can be a force for terrible time-wasting, or for terrific growth. Which will you use it for?
Time- Finally, you’ve got the most powerful force in the universe: time. You aren’t looking at forced retirement in five years. You’ve got the next twenty or thirty years to crush it. If you create a solid plan now, and simply follow that plan, you are going to have to work hard not to retire a millionaire. For more on my specific plan, check out my article, “How to Make A Million Dollars in Real Estate.”
Your First Investment
Obviously, your first investment is going to depend on your situation. However, I believe for most people your first investment (besides investing in yourself through reading a TON of books, blogs, and forums) should be your primary residence. As I see it, there are two great options you have. When starting out, I did both of these:
- Live-In Flip:My very first home was an ugly, single level house I bought before I knew what real estate investing was. All I knew was that it was the cheapest house around, and I could get into it with almost nothing down (just a few thousand, that I spent a few months scraping up.) I then spent the next several months painting, adding new flooring, and doing many more improvements on it – finally selling the property for a nice profit, which paid for my wedding and the down payment on my next property (which I’ll discuss next.)
The beauty of the “live in flip” is that since you have to pay to live somewhere anyways, there are effectively no “holding costs” on the flip. You could take three months or three years to sell it – but in the end, you’ll profit. Additionally, if you buy with a fixed rate mortgage (which you should) your payment will stay fixed for as long as it takes.
- Buy a Small Multifamily: As most of the BiggerPockets community probably knows by now, I’m a HUGE fan of multifamily properties. The second property I bought was an ugly little duplex (well, two houses on one lot) that my wife and I lived in for a year, while renting the other half out. This enabled us to live rent-free, and enabled me to quit my job and get into investing full-time. You can read more about this property in my article, “How I Accidentally Bought Two of Kurt Cobain’s Former Homes and Why That’s Not Even The Best Part.”
By living in a small multifamily property – you are able to decrease your expenses, while locking in the super-low rates that are available to owner-occupants today. When you move out – that low fixed payment stays the same and that property will become the first in your collection of real estate investments. Additionally, the experience in landlording you’ll gain living in a small multifamily property will help you for the rest of your real estate investing career. It truly is a great first step.
What About Money?
Yes, real estate costs money. However, the benefit of the two options above are the ability to use low-down payment methods to get started. In the US, there is a program insured by the FHA that allows homeowners to buy a property with just 3.5% down payment. On a $100,000 home – this equates to just $3500 plus closing costs. Can you come up with $5000 to get started on your financial future? That’s one more benefit of being young: the ability to get out there and hustle. How can you make $5000 over the next five months?
Even better, the FHA has another program called the 203K loan – which allows you to incorporate the needed repairs of a property into the loan itself, and still only pay 3.5% of the total loan amount. This takes care of the repairs needed to fix up the properties, and limits the amount you need to get started. To top all this – you can use the 203K loan on small multifamily properties as well – which means you can combine all the benefits of the live-in flip and the small multifamily strategy into one, feasible plan.
To read a great article on using FHA loans for small multifamily properties, check out “New Investor Strategy: How to Buy Your First Multi-Family Investment Property & Live Rent Free”
Start Building Relationships
I’m going to tell you a secret: Old people like ambitious young people.
It’s true – just ask any of the old people on BiggerPockets (just don’t tell them I called them “old”) There is something truly rewarding about helping an ambitious young person achieve their goals. I think a lot of it has to do with “I see myself in their shoes” or “if only I had started back then!”
Whatever the reason, it is a fascinating and powerful phenomenon. Use this to your advantage! Begin to build relationships with the older investors who have come before you and graduated from the school of hard knocks. Let their failures teach you to avoid (or fix) your own.
There are two great places that you can start building these relationships today: locally and online.
- Locally, there are probably dozens (if not hundreds) of old-time landlords and real estate investors in your area who may take you under their wing to help mentor and train you. These relationships are often simply a friendship, built over many cups of coffee and errands run for the investor.
- Online, these relationships are built everyday in the BiggerPockets Forums, where investors from across the country get together to help answer questions, build relationships, make deals, and improve the lives of everyone involved.
What About Wholesaling? Isn’t That The First Step?
Wholesaling gets a lot of publicity, because the gurus love to talk about how easy it is and how you can make hundreds of thousands of dollars in your spare time with no money.
Look – wholesaling is a real thing. I’ve done it, and a lot of other people on BiggerPockets have done it. However, here is my problem with wholesaling: it’s too easy to quit. Most people who try to get into wholesaling never make a dime (my opinion.) They jump in because it looks easy, but quit soon after beginning because
- It was too hard
- They didn’t make any money or
- There was a new shiny object
Wholesaling is a job, or more specifically, a business. Granted, it’s a self-employed business with flexible hours and the benefit of getting to learn the business of real estate without investing a lot of money. It’s still a job, though, that requires time, dedication, motivation, and money for marketing.
If you can get started investing in real estate by wholesaling – great! Just realize that most wholesalers never get past their education. It’s much more difficult to walk away from a duplex that you just bought than to walk away from a wholesaling career.
For more info on my thoughts getting started with wholesaling, check out my article How to Start Wholesaling: Getting Past The Education and Into the Field.
Where Do I Go Next?
Time is ticking.
You are getting old, fast. You aren’t going to be the “whiz kid” for long, so it’s time to start. Evaluate where you are, where you want to be, and the path you need to get there. If you are unsure of any of that – it’s okay. Go post your questions, fears, troubles, whatever in the BiggerPockets Forums. Start connecting with some of the brilliant real estate minds here on BiggerPockets (or with the not so brilliant ones, like me!)
What are you waiting for? Another round of Modern Warfare III? Another Facebook picture of a Cat?
What are your struggles when getting started? Or, if you are “old” already – what’s your advice for the younger ones? Leave your comments below and let’s chat!
OH- I almost forgot!!! If you are just starting out, we actually created an entire online FREE BOOK for you to learn the basics! It’s called The Ultimate Beginner’s Guide to Real Estate Investing and you can download it by signing up in the blue box below or just clicking here to read it online!
P.S. – Have you signed up for BiggerPockets yet? Why not? It’s free… Seriously. Do it. 
Thomas Leuthard, martinak15, WomEOS, and KJGarbutt
{ 65 comments… read them below or add one }
You knocked it out of the part yet once again, Brandon! Awesome post. With another reminder of growing old coming up for me, I can totally relate — especially the part about driving 15 under the limit. Your real estate advice rocked as well!
Thanks Josh
I still drive a little too quick, but I’m slowing down. I think that changes with kids. (cause apparently I’m willing to risk my life and the life of my wife – but not children…)
I actually originally included you in a joke in the post, about being old and your pending birthday, but took it out. I didn’t want to give you a heart attack.
This is an AWESOME Post! It’s morale boosting to see some young investor support on BP. Brandon I’m surprised you didn’t add ANIME to the list of what’s distracting us.
Anyway, I’am currently 21 in the real estate market of Baltimore,MD, but instead of investing, I’m wasting time and MONEY in college on a bachelor’s degree, in a field that I have no love for anymore, even though I’m good at it. (Degree is in Information System Security)
What are my struggles when getting started?
I ultimately fear that I won’t be taken seriously in this business being young and sound so young. I don’t think I’m persuasive/convincing enough to get people to sell me their house. Add the fact I’m a Perfectionist and Over-analyzer … ugh anyway, but I feel pretty confident in what I know, it’s just getting the courage to take CONSISTENT action and believing that I can do it.
I mean, I’ve been interested and learning about real estate since 16 and for the last 5 birthdays and Christmas’s with my gift money I bought course after course and ebooks about wholesaling, lease options, and buying notes. So by now I should know enough of something atleast to take action on.
Latest thing I bought was tickets to Marcel Umphrey’s Bootcamp thing which pretty much broke the bank for me … again.
I hope it’s worth it though, either way I’am NOT ending 2013 like 2012, I will make this year the year of my success and get out of my mom’s house!!!! Lol
Thank you Jerome! I know it’s easy to get caught in that cycle of never doing, always learning. Feel free to jump into the BP Forums for more advice on moving forward. The community over there is amazing.
I’m old, and I’m exhausted from reading that long post.
I’m going to lie down and rest.
Funniest thing I’ve read all day!
Hahaha Karen! I think you are far from that old. I see you as more of a “drive 15 over the speed limit” kinda gal.
Hey Brandon –
I love this post and the video. Sadly, there is a lot of truth hidden in that comedy.
But …..You really have to quit using the “O” word. There are a lot of us here in case you hadn’t noticed; in fact you are pretty much out numbered.
Here’s the thing; everyone that is old ie over 40 lives in denial. (Here’s a tip for Josh now that he’s old.) That’s what you do; you just pretend it doesn’t apply to you. You just keep doing things that your friends have decided they are “too old to do”. Continue to ski, go skydiving, or build another business. Do something unexpected. Most of your friends will think you are crazy (even when you are young). That’s why it’s so important to network with like minded people.
Here are my thoughts on being a young investor. When you are in any business, if you really know your business, age is not a deterrent so much as letting your age make you look inexperienced. You can only look confident and experienced from really knowing what you are doing. Sure there is a lot to be said for pretending to be confident when you really aren’t. But someone will nail you to the wall one day when they ask you a basic question that you can’t answer.
So spend your time studying and learning. If you are really serious about building a buisness, give up TV and video games in the evening. You have hours every day and on the weekend that you can choose to use for this purpose. How you use your time is definitley a choice. Do your homework and you will become credible no matter what your age.
It won’t always be easy, but I can guarantee you it will be worth it!
Sharon
Great advice Sharon! I always find it interesting when people say “but I work a full time job!” and then I remind them that there are 168 hours in a week, and only 49 need to be kept for sleep (or 56 if you like your 8 hours!). That leaves well over 100 hours to make a future for yourself.
And yes – I feel slightly outnumbered around here!
Thanks for commenting!
Sharon, great comment.. I am in my late 20′s – and do not consider myself old.. It’s bizarre & discrediting to see so many people around my age, or even 10 years older considering themselves “old”.. Even if they don’t think they live that out – they speak about themselves with limitations years before they have them, and basically spend the majority of their lives as “old” .. I think people need to be careful even writing it – because it’s truly just an opinion, not a fact- and it’s setting the tone for everyone else to pick it up.. Again, I am not in denial, or living like a college student – and I think the post is great, ageism just sets the tone for everything else.
Emily –
You are really young still in your 20′s. It’s a perfect time to start investing. Age has nothing to do with it. Some people start young, and some folks start after they have retired. The major advantage you have by starting now is that you have a lot of time to buy property and get it paid off while you are still “young”. (That number will change as you get older. LOL)
Figure out what you want your monthly gross income to be. Let’s just say that it is $8000 per month. All you would need is 10 paid off houses that rent for $800 a month. You don’t need a million houses to have financial freedom. What ever that gross income is, buy solid 3 bedroom houses and good neighborhoods that will appreciate and just get to work paying them off. Put aside a percentage of your money each month for repairs and when you have a nest egg built up, go to work paying those houses off. Don’t refinance and pull the money out. Pay them off and you will have financial freedom.
Thanks for your comments Emily.
The things I would stress on are: if you’re in school, learn all the math and English you can, obviously you have. Second, find people who are doing what you want to do and learn from them. Everything else you pointed out would be a good plan to follow. Great post!
Yes, I’m old, can’t do the things I would like to do, way too many broken bones- roofs!
Great advice, Jim. I agree. I feel like I could have gone on another 100,000 words with this post with all the things I wanted to say, so thanks for the advice! You said it much more succinctly than I would have
Are you actively investing in Aberdeen? The couple of times I’ve been down there eyeing the cheap properties I’m always worried about the workforce and employment rates. I’ve also heard that they have been talking about closing the lumbermill.
I’ve got a couple of properties that are catching my eye out in the Ocean Shores ares too.
I wish I had started investing when I was younger. When I was in college I told my parents we should purchase a house to rent out while I was in school. It took me roughly 10 years later to start actively investing. Congrats on all of your success.
Hey Troy-
Yeah, I do all of my investing in Grays Harbor County right now – which presents some interesting situations. The mills are always either closed or on the verge of closing, so we just come to expect that and most jobs pay minimum wage, which keeps the rent from ever changing much but there are enough of those jobs to keep people employed.
I don’t recommend Aberdeen or Hoquiam for appreciation thought – but for cashflow, it can be pretty great. I’m also looking at Ocean Shores – for appreciation, since it is a vacation area and it swings much more with the market. However, I’m most in love with the Montesano area right now for flipping, due to the low days-on-market.
Thanks for the comment Troy! Keep in touch!
I too own a bunch of SFR in Aberdeen, one can buy some realy nice properties for very little money. As Brandon said, cash flow is great but appreciation not.
Brandon-
I am interested! And I have read your posts. And we grew up together. So, I win some sort of award, right?
We did grow up together, and you are the first old-time friend to comment. So yes – you win an award. I’ll be sure to get the CEO Josh Dorkin to allocate some funds…
Other reasons investing in real estate at a young age is hard? Student loan debt! Getting married is expensive! I have to have health insurance?!
You’re right though, Brandon, about the programs available for us to get into homes on the cheap. I didn’t use a 3.5% FHA, but got into a bank-owned light rehab project for just 5% down, and we lived in our house –exposed floorboards and all– until it was completely renovated. We love our house and because we bought a fixer we were able to get a 15-year loan that is still cheaper than renting!
Now, back to that Black Ops II campaign…
Ah, so true Tyler! I’m still kicking off student loan debt! You did it right, so congrats to you! My wife and I just did a similar thing, and our refinance (which goes through on Monday) is going to make our house payment under $400 per month! I’m very giddy
Good luck on the Black Ops II campaign!
Thanks for the Encouragement Brandon. Its good to know that you serve to this little known niche of people in the real estate world.
I was reading the suggestions you gave for us young people. I’m interested in the second option (buying a small multi-family) however, after seeing my first purchase fell out of escrow (bc my employer reduced my hours from a full time to a part time) i’m scrambling to figure out what needs to be done to get a house (esp a quadplex). You mentioned that we as young people have the ability to hustle, however In getting a loan banks really don’t care that i have $19k towards a down payment they want to know that I have a stable job ( i also do side jobs and have saved a lot to get to where I am) are there any other alternatives to finance such a house?
Also about 203k’s, the lender who pre-qualified me said that 203k loans are hard to get and that one must use a licensed contractor to do the jobs. I’ve worked on houses with my parents and know what to do but I’m not a “licensed profesional” is that true? I really want to start investing and this failed deal has only made my desire to invest even stronger.
What can I do?
Hey Jorge,
That’s tough with the job thing. Honestly, if it were me, I’d probably switch jobs to full but stay in the same field so it still counts. Also – as far as I know, you do not need to be a contrator to do a 203K loan, as long as the repairs are less than 15,000. If it comes to more than that, then yes – you’ll need to just hire a contractor (which, at that amount, would be a wise thing to do anyways.) Perhaps look at another lender. Wells Fargo is the last one I was involved with on a 203K loan, so try them!
Hope that helps!
What an awesome “Beginnings” story for your family and future generations. I love hearing about people who scraped by and did the hands on work, then really learned to delegate and systematize to expand their success. My family still thinks I’m crazy. It’s definitely a must to find older mentor/parent-figures who can be your cheerleader if the family doesn’t get it.
Excellent advice Tiffany – the older mentor helps a ton. Mine has turned into more than just a mentor, I know consider him a business partner in a lot of things I do. Thanks for reading this behemoth of a blog post and commenting!
Brandon
You are spot on about ‘wholesaling’ and it being a grind. Even now I kick myself to think of the money I’ve spent on marketing with limited success. Reading your article has me reconsidering my investment ‘strategy.’
I consider myself middle aged and am very grateful that at my age the ‘blinders’ were removed and I can see how wealth is created through real estate and living within our means.
Great article!
Thank you! I know there are some great wholesalers out there, but it’s definitely not my first choice for building wealth. Those that are good at it find that they really love it – so it works for them. Everyone else, though, seems to waste a lot of money and time.
Yeah this is me right now 13 and eager to get my feet wet. So i’m that “whiz kid” in my circles. Love this post, very informative and realateable. But any advice anyone, on how to do deals as a minor, im beggining to explore the idea of land trust. Any tips?
13 Jordan!? I’ve never had someone so young interested! I’d say the best way to move forward is to just read a lot, become a pro, get massively good grades in school, and start building those relationships now. Don’t lose that passion!
GREAT ARTICLE!
Thanks Alfredo
Brandon –
Starting your investing career at a young age is the smartest thing you could have ever done. You will never regret it! You may be young, but you are more experienced than a whole lot of people a lot older than you. You just need to remember that.
I have a friend that invests in Columbus, OH that is also 27. In fact I did an interview with him; Jeff Kowalaczek. He has bought some big packages of properties, is selling off some of the bad ones, and is dealing with hedge funds. Imagaine that; and he too is 27. Also much like you, he is looking down the road to see how he needs to change his business to suit the lifestyle he wants to create. You can look him up on facebook, or I can put you in touch with him. He’s in my mastermind group.
Sharon
Thanks Brandon for the encouragement! I’m 26, halfway through dental school, and anxious to get started. I’m on the brink of marketing for my first wholesaling campaign. I would much rather buy and hold, but I’ll be moving out of state in a few years and everyone recommends avoiding long-distance land lording, especially with a tight budget.
I figure even if I fall flat on my face with wholesaling at least I’ll learn something. It helps that my wife and I are having our first kid in 6 months, so we’ll be losing her income – having a family to support sure gives you the drive to work hard and make cash now!
I love you and Josh’s podcast, I’m always looking forward to the next one.
Brandon,
This is an awesome and very motivating article! I have been reading a lot of articles and forums on this website and there is such a wealth of information available here. I am 26 years old and live near Portland, Oregon. I am still trying to figure out how I am going to get started with real estate investing but I know that I want to invest for cash flow. When I start to get discouraged, an article like this is just what I need. Thank you!
-Bill Horton
Thanks Bill. I’m just north of you a few hours, in Western Washington. I hear Portland is pretty expensive, but the outskirts can be more reasonable. Definitely keep in touch as you move forward!
Thanks for sharing.
Great article for young people like myself to get started and stay motivated!
Can’t wait to start investing
Thanks Ryan, Let us know how we can help! Be sure to jump into the Forums for a lot more one-on-one help!
Great article Brandon! Definitely wish I had this insight when I began investing.
Thanks Harrison, me too!
Perfect! Awesome article!
Thanks Travis!
Hey Brandon,
This kind of articles keep us motivated as young new guys (Im 28) getting in the way of much wiser investors. What I believe that have in our favor is as we have in general more willingness to get a little dirtier with cheaper, dirtier deals, I believe that the returns are way better there… Of course there are just too many people with teams for repairs but I have seen way more deals with holes in the walls and ceilings if you know what I mean that clean and neat properties…
Also, you mentioned small multifamily units. I love that idea but I have the feeling that I can build a gold mine if I put some factors together. Have you done the math of trailer homes? even better… small properties with some 5 to 20 trailer homes that you buy one or two per month? I have found that those cash flow like crazy! Of course I wont chase the expensive all fixed deals, but instead will look for really cheap trailers in decent conditions, fully remodel them and get a package together… Anyways, I think its a great way to start a cash flowing machine with little money to fund greater deals… Let me know if you have experience with it at all… I am just too motivated to get it done asap (even when I started with SFR first)
Again thank you for the post!!
Hey Jose, thanks! I haven’t worked with mobile homes yet – but I hear good things. It’s on my list to check out sometime soon!
Brandon,
This article was very motivating. I really appreciate it. I’m 23, working full time, but am applying to medical school. I’m anxious to get something done before I matriculate this fall (assuming that actually works out lol), but I don’t have a whole lot of cash in reserve, I don’t know where I’ll be (could be Atlanta, Boston, or NYC area), and I feel like good deals are being snatched up before I even get to see them. I figured that at least I could get some experience in the industry to supplement my lack of funds – assuming I could find a really rich partner or something – so I now work part-time as a RE Agent in Boston. Even still, I just feel….stuck. I fear buying a cheap place in Boston/Lower Westchester/Bronx (the areas I’m looking at) mostly because rental income might not cover expenses of PITI, the 50% rule, and potential property management. Such a place could also probably be high-vacancy due to crime, have crappy tenants, or even suck because of absurdly high property taxes (my hometown of Mount Vernon, NY has taxes above $10k on average, it seems!). I’m sorry for the long comment , but I guess I might be venting some frustration right now haha. Seems like I’ll have to wait a bit, I guess. Patience is a virtue, after all, right?
Anyway, I really appreciate the post. As someone who regularly reads what you write here on BP, this ranks as one of my favorites.
Thanks a lot!
-Rashaud
Thank you Rashaud – it’s great to know people are finding value. I understand the feeling of being stuck – and I know it’s tough to get started while living in those expensive areas. Let me know if I can help!
Brandon truly wants to help the next generation. Thank you!
Wait – I think I still am in the next generation!
Thanks for the comment Ryan!
GREAT article Brandon!
I’m 21 and just starting out with doing lots of research and building relationships with people who know FAR more about this stuff than I do! As someone who has been considering a Live-In Flip, this article was a GREAT resource of information for me!
Look forward to reading more,
Thanks Jon,
Research and Relationship are key in getting started. In fact -that’s a great name for an upcoming blog post. “The Two Most Important “R’s” for Newbies to Master” I like it!
Hey Brandon!
I think I qualify for the old family/friends clause, so thought I’d leave a comment! I can also relate to the whiz-kid phenomenon, including the borderline panic that ensues when I think about how it’s slipping away day by day! Great article and reminder to continue seizing the day.
Thanks for sharing!
Hey hey fellow math league buddy!
Thanks for the comment sir, and letting me know I do have friends who read my stuff!
AWESOME blog by the way! Keep up the good work over there. I love the “wisdom, wonder, beauty” buttons at the bottom. Very cool!
Hello Brandon,
I just wanted to say thank you for the motivation. I am in a bit of a rut considering my situation, but it is always a nice motivating tool to read from others who are successful and to use that to your motivation.
I live in Chicago and have been actively searching for a live in flip as my first investment. Back in 2008 my father was let go from his job and as a result I spent much of my college years attempting to help my family financially and with their mortgage as much as I could while taking care of my bills and schoolwork. Long story short I handled it how I could, but at the expense of my credit which is not good. Now i work full time and it seems that my only option to complete a live in would be an all cash deal. I do not waste money now and Im quite conservative(or at least I like to think) so saving up money has not been very difficult. It’s a bit embarrassing to admit, but I cannot change the past now and I am only looking on improving my current situation.
Are there any options that could help me get started with my goal of obtaining a live in flip this year given my situation. Like many of the young investors, or soon to be investors here like myself, I have plenty of drive and time, I just lack the creative know-how and experience to overcome my current hurdles.
Thank you for the informative read.
Hey Ramon,
I know there are a lot of people in your very shoes – they have not-so-great credit because of past history – but want to invest in real estate. A few thoughts on that:
1.) I’d start looking for the more inexpensive places to flip or invest. It’s much easier to buy a $50k property with bad credit than a $250k property. (Hard/Private money is much easier to get at the lower amounts when starting out)
2.) Start building credit now. Do whatever it takes (well – don’t pay some scammy company though.) Go read every book on Credit Repair you can find at Barnes and Nobles and then set out to build it. You only need a 620 (I think?) score to get an FHA loan for a 3.5% down payment on a live-in flip.
3.) Also – start small. Perhaps your first deal will be just working for a local flipper for free, in exchange for him showing you some of the ropes. Maybe it involves finding someone who has good credit to split a 50/50 deal with?
I’d definitely jump into the BiggerPockets Forums and become a familiar face there. Few people fully understand or use the incredible resource that is there – hundreds of pros, willing to donate their time to help you overcome any problem. Think of hundreds of people, much much smarter than me, willing to answer questions and point you in the right direction, anytime – day or night. It’s awesome.
Hope that helps!
Hi Ramon:
What Brandon said!
And, join your local real estate investor groups and local landlords association to begin hanging with people doing what you want to do. You’ll also learn the language and who in your market can guide you to success.
Find out what the people in these groups are looking for so when you start hunting, you can “sell” them the deals you come across that you can’t handle.
Progressing to flips may take some time because they are typically cash intensive and you need to know a lot of contractors to get the work done on time and within budget. Oh, yeah, and you have to understand budget!
You will get there and with all the drive you have, you will be tremendously successful! Keep us posted.
I’m really glad I found this post. I’m 18 years old and I’ve wanted to invest in real estate since I was about 12. I have $14,000 in the bank right now because I am lucky enough to have fairly rich grandparents who give each of their grand kids $10,000 when we turn 16. I’ve decided to save this money solely for real estate and I’m even going to a community college with financial aid so I don’t have to dip into my savings. The biggest challenge that I’ve faced is trying to motivate myself to take the leap and start with my first investment. I don’t know when or where to start but I think Im going to try and get very serious about this after a few more years of college (even though college is really starting to feel like a waste of time). Im definately going to go look at this biggerpockets forum and see what people have to say. I think the only thing I need before I can start my investing career is to get a job so I can get a loan and pay rent. Again I’d like to express how happy I am to have found this post. Thank you for existing haha.
Hey Raven, thanks so much for the awesome comment! Definitely, jump into those forums and get connected! It’s such an awesome community. Also, be sure to check out the Ultimate Beginner’s Guide to Real Estate Investing to help you get going!
Amazing article. I’m 18 years old and I’ve been researching about real estate investing for almost a year now. Been to classes, forums and talked to as many people as I can. It’s true the part of “old people like young motivated kids”. I experienced it myself just a couple of months ago. The biggest difficult to me is actually the “balls” to get started. My objective, is a little bit more bold and tricky. I want to be a real estate developer. In my case, my region is full of new residential complexes and I’m definitely want to start as soon as possible, catch the wave and get some cash. I know it won’t be easy tho. I gave up TV and other things for now. Been studying like crazy, I only enter the internet for research and to consolidate my newly-launched website! I know that if I’m really serious about my goal, I have to make it happen and get my hands dirty! I fear some people won’t take me serious when I show up to see a land and things like that, but I also know that there will be some who will admire that. I hope to find this person as soon as possible
thanks for the article and thanks for the advices! Very inispirtational!
My advice to anyone wanting to get started is to learn, learn, learn and find a mentor. You can get a great education here, on other blogs and at your REIA group. Join that group and look for a mentor right in your city.
Sharon
Hi,
I want to buy more property but I don’t have the cash. Can you please give me some advice. I’m 32yr single, 3kids, 47k income… I bought my 1st home in 2005 I’m renting it out w/o profit to a family member…should be PIF when I’m 55yrs. I bought my 2nd home (the one I love and want to retire in) on 2010. I wish I was making profit off my 1st home but since I’m not I am thankful that someone else is buying me a house or giving me 127k plus if I decide to sell it. I have read it all takes patience.. I understand that but at the same time I feel like I need to buy a piece of property that will give me extra income now.. What should I do? I think that if I can find someone to invest with me on a flip.. we split the cash and go our seperate ways I’ll have the money I need to buy something else.. Is this realistic???
Great and motivational article! Investing in real estate at young age is extremely difficult due to scarce finances and very little life experience, but it’s doable if you have a great researched plan and lots of motivation. I have done that myself and feels good to be financially secure by age 30-35. Thanks for sharing your wonderul inspiring story!
Hi,
I am a 21 year old college student currently employed with the army national guard. I will buy an investment property it is just a matter of how. I have built up a large amount of capital but again I am only employed part time. I will commission into the United States Army as a 2nd LT next may bringing in a full time salary. I have been studying for about a year now learning the in an outs an continue to seek more advice. My main problem is that I do not bring in a full time salary. I received a private loan for my first property from a family member that is working out well right now. Is, interested in doing my 2nd one on my own. I have the capital for a FHA down payment a long with 11 months of reserve just in case the property sits(which it won’t). I have a great real estate agent who I trust and cares about my individual investment not his commission. Each bank questions my debt to income ration stating they do not feel comfortable with what I make yearly. I bring in close to 1300 dollars a month and can get another job if that’s what it takes. I have tried local banks but no luck. Please let me know what my next steps should be to achieve my goal for property number 2. Looking forward to the wealth of knowledge coming my way! Thank you! So happy to find people like me !
Fitz, have you thought of getting a zero down VA loan? You could buy a 4 plex and move into it.
Yes, I don’t meet the 6 year eligibility and I was only deployed for 60 out of the 90 days required to become eligible.
I am 29 turning 30 in November and let me tell you it took me this long to exit the mentally of the kid that governed all my decisions. Needless to say I am incredibly driven, perhaps realizing that I am a late bloomer I’ve been reading 1 book a day on the subject. My next step seems to be finding a mentor in real life who can teach me what they know, after all I can learn only so much by reading. I am fortunate enough to have parents that will give me my starting investing and maybe that’s why I have put it off so long. Thanks Brandon great blog that explains everything clearly to a beginner. Do you think there is hope for me?
Sorry nick, it’s too late. You are simply too old!
Kidding of course. Most people don’t start getting serious about real estate till they are like 50 and facing an upcoming retirement. So you are miles ahead of most! I’m pretty convinced that anyone can “retire” with real estate in 10-15 years, part time. You just gotta have a plan, and know how you are going to get there. Definitely read through the Ultimate Beginner’s Guide (labled “Real Estate Investing” in the “learn” tab above! )
Hello Brandon,
Thank you for this wonderful article.
I am from Dar-es-salaam, Tanzania, East Africa. I am passionate and would like to invest in real estate here in Tanzania but i am facing challenges concerning acquiring a genuwine land or building to buy and invest. We have so called Land conmen where you can find a piece of land or a house being sold to 2 or more people. I am afraid to waste my money on something i am not sure if its genuine or not. Please advice.