The ONE Thing You Need to Do to Get Started as a Real Estate Investor
Do you know why real estate investing is so hard for most people? Maybe it’s not hard once you get into it, but isn’t (or wasn’t) getting started incredibly daunting and intimidating? Why is that? I think it’s because real estate investing was never taught to most of us growing up. Maybe a few of you were lucky enough to have family members who were investors so you were able to get into it more naturally, but I’d venture to say that’s not the case for most of us. I’ve never even heard of a school that teaches it. Certainly not high schools, and some colleges offer real estate degrees, but that’s about it.
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So can I go out on a limb and say that getting started as a real estate investor is incredibly hard? Hard in the sense that it can be overwhelming, confusing, and one of the worst parts about it is you don’t know who you can trust to learn from. Other industries are more black and white about how to do things, so when a college professor teaches you something, it’s doubtful there is room for that information to be completely wrong. Whereas with real estate investing, there is everything from risky investments to scammers to bad information, you name it!
There all sorts of beginner’s guides out there, both on BiggerPockets and from other sources. If you start researching real estate investing guides, you’ll be bombarded with options of things to read! Just on BiggerPockets alone, you will have absolutely no shortage of things to get you started.
One of the best resources written by our fearless leaders Joshua Dorkin and Brandon Turner is “The Ultimate Beginner’s Guide to Real Estate Investing,” which is an excellent starting point for anyone interested in getting into the industry. In addition to their guide, there are several blogs and blog writers that focus on helping out beginners, and then you can find pretty much any topic covered in the Forums somewhere.
While it is exciting to know how much information is out there to help an investor get started, does that really take away the nervous, confused feeling of how to jump in? It may actually make it worse. Even when you read beginner’s guides, it is possible you might end up even more nervous than before you read it. This can happen because anytime you start reading more about real estate investing, inevitably you will start to get a little bombarded (or a lot bombarded) with new things to think about and things you supposedly have to do.
So what if I told you that I can ease your stress by telling you just one thing you can (and should!) do to get started in real estate investing in the easiest and best way possible? I’m sure you’ve heard it before, but I bet you haven’t thought of it as being the only thing you need to do right now to get started.
Are you ready for it? Drumroll please…
Read, Study, Research & Investigate Everything You Can
That’s it. Fairly anti-climactic, huh? I know it sounds really boring, and it’s doubtfully new information, so let me expand on it a little bit, and hopefully then it will seem a little more exciting.
If the only thing you are required to do to successfully become a real estate investor (for now) is just to read and look things up. Doesn’t that take off an awful lot of pressure? How easy is simply reading! Sure, you will eventually have to act on a deal to make it happen, but know that not acting just yet is actually smarter. That is all sorts of pressure taken off your plate! You will be better if you don’t act right now.
The more education you have getting started, the more graceful you can be diving in. Education can save you a ton of time and money in the long run because it will help you avoid costly mistakes, it will give you more options for paths and creativity that can dramatically increase your profits, and you can avoid wasting time doing things you hate.
The best way to be as successful as possible as a real estate investor is if you find your true niche. If are working in an area of real estate investing that goes against your natural grain, it will be a constant uphill battle to succeed. You still may succeed, but have you ever heard of strengthening your strengths instead of your weaknesses? It’s the same concept. You will succeed much more if you focus and work in the areas you are already good at. What are those in real estate investing? Who knows.
You couldn’t have offered me a million dollars when I first got started to tell you that my niche would end up being turnkey rental properties. I didn’t even know what that term meant, much less that I would end up quitting my job as an aerospace engineer to work with them! Well then, how did I find turnkey rental properties? I didn’t — they found me. And that’s how you find your true niche. You study and research and pursue everything you can get your claws into, and eventually your niche will find you. It’s the only way to figure it out. Man, if I had tried flipping properties just because I always heard what a great gig it is, I’d likely be so broke right now I wouldn’t even have this computer to type this article on. Not because flipping isn’t lucrative, but because it’s not something that is naturally in my bones.
You don’t have to risk large amounts of money to read, study, research, and investigate! Doesn’t that sound more exciting than putting up some atrocious amount of money for a deal you aren’t quite sure of right away and losing it all? Smaller seminars or webinars are fine to pay for and worth the money, but don’t go for the big, expensive programs to start. If you later find your niche, then maybe those programs will be worth it, but not until then. For example, do one of the 3-day “Rich Dad” seminars for $495, but don’t buy one of the $5,000 advanced courses.
Narrowing Your Focus
I’ll give you a quick run-down of how I got to where I am in real estate investing to prove to you that just reading, studying, researching, and investigating really does work. The minute I sat down at my new desk at my new aerospace engineering job, i.e. my first corporate job, I knew I wanted out. I had no idea where to start or what to do, but I knew I had to do something. With no one to ask, I just started Googling anything and everything I could. Eventually, a friend recommended the book Rich Dad Poor Dad by Robert Kiyosaki. From the minute I read that book, it was ON. I was either going to start a business or get into real estate — I had no idea which — but I looked for every bit of information I could find.
I had a million ideas of what I wanted to do at any given time, everything from owning self-storage facilities to buying a hotel to buying apartments to starting random businesses to owning rental properties. But even when I was thinking of the rental properties (which I ended up pursuing), I still had no idea what I was looking at or for or how they would even get me out of corporate. I spent money on education, but I wouldn’t guess it was more than a thousand or two combined (only even that high because of the self-storage convention I went to in Vegas when I thought that was the route I was going to go).
In the midst of all this too, I was talking to all sorts of people under the theory of "fake it 'til you make it." I never let on that I had no idea what I was doing, but I was also up front that I was new. I did this with a commercial real estate agent, a big investor from Miami (who actually taught me how to structure partnerships), and anyone else I ran across. This was part of the investigation and research part of exploring â talking to people is education in itself! I was also reading every book I could get my hands on. I barreled through just about the entire Rich Dad series, I was reading business books, and I even bought Accounting for Dummies in thoughts that I would need to know accounting principles (I never had a business class since my degree was engineering).
This all went on for about four years. Four years! Granted, I was working a full-time job at the time, and I moved to California in the middle of that, which took up a lot of time, and I did have somewhat of a life, so all of this research really was on the side, but four years nonetheless.
Eventually I got really frustrated because it seemed like all this research wasn’t actually coming in to fruition. I realized it was because I needed to hone in on a focus and stop learning a little about a lot. I needed to pick one thing to now learn a lot about. I chose business. I immediately dove in thinking it was time for me to figure out how to buy a self-storage facility, which is how I ended up at that Vegas conference, and I was certain I had figured out my path. All of a sudden, two weeks later and bored at work, I read an ad in a real estate magazine that caught my attention. The details of it aren’t important, but ultimately that ad ended up completely turning my thoughts on how to get out of corporate upside down by dumping me headfirst into real estate and eventually creating my company, which is what got me out of corporate and working for myself.
In all that time of investigating different paths and attempting to choose one, the difference between what worked for me and what didn’t was the level of difficulty with each. Every other idea I had explored felt like I was swimming upstream, whereas when I finally found passive turnkey investing, everything flowed so easy. It still required a lot of effort on my part, but it wasn’t a constant fight. In fact, none of it ever felt like I was fighting to make it work. This is how I know it’s my niche. The other stuff wasn’t, or at least wasn’t right for me at the time, hence why it was so difficult to make it work.
This is why reading, studying, researching and investigating is such a perfect way to get started. Because you won’t have to figure out your own niche or how to do it; it will find you! But this will only happen with intensive exploring on your part. The other cool thing about doing it that way is you will meet several people who all do different things, and this will give you the time and comparison factor to figure out who the best people are for you to work with. When I met my guys, all through that one magazine ad, I knew I had found my crew. I still work with them to this day, and it’s now almost five years later. It’s like I knew they were “the one.” I never could have known that had I not looked into so many other options.
That’s it! That’s all you have to do to get started. Read, study, research, and investigate. In other words: explore! Here are some hints as to how to maximize your time exploring:
- Ask a lot of questions!
- Pursue any avenue that seems interesting to you as if you are going to for sure get into it. This will give you more information and insight than if you just browse the avenue with a 25,000 ft view, and it will quickly tell you if it is something for you.
- Be very respectful of anyone offering you mentoring advice or help. Understand that they are likely not getting compensated for helping you and that they do have their own life, so be very thankful for the time they do give you (and tell them so!), and don’t go overboard on how much time you expect from them. On the flip side, don’t hold back on asking good questions either. Don’t hesitate on asking for information, but be willing to do some of the legwork on your own without them.
- Be willing to spend a couple to a few hundred dollars on smaller educational programs, whether from gurus or wherever else you find them. Even if a program turns out not to be great, I guarantee you can still get incredibly valuable information from them. Even if you only go home remembering one thing from the program, that one thing may be the reason you become successful later. I can still remember one single line from that 3-day Rich Dad seminar that dramatically changed the face of my investing career for the better. Just that one line alone was worth the $495, easily!
- Don’t do any of the overly expensive education programs, yet.
- Understand your own goals. Why do you want to get into real estate investing? If you know these goals clearly upfront, you will be better equipped to know what facets of real estate investing you actually want to pursue.
- Don’t confuse not acting right now with not acting ever. If, while you are doing your exploring, an investment opportunity comes up that you are interested in, it may be good to go ahead and pursue it! You have to figure out where the balance is of holding off on acting while you expand your education and not acting when you should.
- Don’t be shy! Network your tail off.
- Listen to what everyone tells you. In the beginning, it’s worth listening to everything anyone wants to tell you. Eventually everything will start making sense to you, and you’ll be able to differentiate between good and bad advice. And if it doesn’t become clear and you still don’t know who to listen to, remember my all-time favorite mantra,“Don’t take advice from someone you wouldn’t trade shoes with.” Listen intently to the people who are living the type of lifestyle you want to live, and take notes!
- Read lots of books. Once you find an author who you really resonate with, read as many of his/her books as you can! Still read and study other authors, but find one and really roll with it. Don’t read books from authors who don’t share your same goals or thoughts on some level.
That’s it! That’s all you have to do! Read, study, research, and investigate. No action needed right away, and it’s not even encouraged! How easy is that? Let success find you. Be open to it and ready to jump on it when it presents itself, but let it come to you.
Newbies: What things are you doing to get yourself started in real estate? Experienced investors: How did you get into what you do?
Leave me a comment below, and let’s talk!