Real Estate Investing Basics

From Sleeping in a Car to Millionaire Real Estate Investor—Here’s How I Made It Happen

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Everyone has their own investing journey. Here’s how I went from sleeping in my car to having over $1 million in real estate investments, with some ups and downs along the way.

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How I Learned to Be Frugal Early on

I grew up in the Midwest, in Minnesota. My mom was a garage sale mom, which means we’d go shopping or garage-saling every Saturday morning. So early on, I learned to always buy the cheapest thing and try to negotiate lower. It all started there.

Then in college, I got an apartment, rented out all the bedrooms in it, and I was living for free. I slept on the couch. Basically I was homeless.

Later, I slept in a car, which was weird. It was just because I had an overnight job and felt like, “Well, I don’t even need a place to live. I’ll just live in my car.” And I had a bad apartment to store my crap, but I just slept in my car every day. That was actually really fun.

Related: The 5 Best Methods to Start Learning About Real Estate Investing

When I Bought My First House

Then, I bought a house. I didn’t know anything about real estate, but it was cheaper than renting to buy a little fixer-upper. 

And that was 2007. So all the lenders were like, “Oh, you’ve got no credit, no job (or at least not a good job). You’ve got nothing going for you. Yeah! You’re approved for whatever you want.”

They were just crazy with lending, so I bought a house. I fixed it up and sold it and made like $20,000.

I thought, “Dang! That was more money than I made all year at my crappy job.”

And so I decided I was going to become a real estate investor—specifically, a house-flipper.

close up of man's hands hovering under colorful drawing of lightbulb

As I was on my first flip, the market crashed—like right when I bought it. I’d also bought a duplex at the same time. I lived in half of it, and I rented the other half out.

I’m writing a book on multifamily (but it won’t be out for another year from now). The beginning of the book is a story about this.

I remember standing in the driveway, thinking all my neighbors are going think I’m a drug dealer because I’m taking cash from this other guy in this shady part of town and walked back to my house. But I remember holding this $650, going, “Shoot, this is more than my entire mortgage payment.”

Anyway, that was the “aha!” moment. Like, I can have a lot of these. What if I had 10 of these or 20 of these? That’s a lot of money coming in. I wouldn’t have to have a job, and I could travel and watch my kids grow up.

So, I just kept buying, even as the market was on the way down, because I just was too stupid not to, I guess.

Related: Out of College, Should I Invest in Real Estate or Retirement Accounts?

Going Up

I didn’t realize how markets worked and that I had no idea what the market was going to do. I figured, “It’s gotta be the bottom now.” And so I’d buy a property.

I mean, I wasn’t going crazy—I wasn’t buying hundreds of properties. I bought two my first year and probably an average of two a year for the first four years (maybe three sometimes). And I was flipping a house a year and then had a rental or two each year.

But I would buy these houses to flip, and then I’d do most of my own work. At the end of the day I’d clear like $0. I guess on a couple of them I made like $10-20,000. On a couple others, I lost money!

So I finally decided it wasn’t fun. 

But at the same time, I’d read a lot of real estate books, and so I trusted the philosophy—or the foundational fact—that if I just hold long enough, we’re going to come out of this. This is how the economy works: up and down and up and down.

I knew we were down. I obviously didn’t know where the bottom was. But I knew eventually if I owned all these properties, all of them were going be lifted together with the rising tide. That’s what was going to help me get out of all of this.

But I never felt like I was making money. I never took any cash flow. I spent most of it on rehab stuff.

worker installs the gutter system on the roof

When I Started Making Money as a Real Estate Investor

Fast forward seven or nine years. And I’m sitting in a coffee shop, and I’m working on my personal financial statement for a bank because I’m trying to refinance. I had just turned 30 at that point.

I’m filling out the financial statement, and I get to the bottom where it adds up all your assets, all your liabilities. And it says I have a million dollars—$1.03 million or something.

I was like, “Well, shoot! I became a millionaire, and I didn’t even realize it.”

I thought there’d be something cool, like bombs going off or fireworks. But all it was, was just that you own property. And then the markets go up and your loans go down and you magically become wealthy. 

And that was the other kind of “aha!” moment. Like, I want to do more of that! I just want to own more property.

So, I just kind of started buying more and larger stuff at that point.

How far have you come in your investing journey?

Share your experience in the comments.

Brandon Turner is an active real estate investor, entrepreneur, writer, and co-host of the BiggerPockets Podcast. He is a nationally recognized leader in the real estate education space and has taught millions of people how to find, finance, and manage real estate investments. Brandon began buying rental properties and flipping houses at age 21, discovering he didn’t need to work 40 years at a corporate job to have “the good life.” Today, Brandon is the managing member at Open Door Capital. With nearly 300 units across four states under his belt, he continues to invest in real estate while also showing others the power and impact of financial freedom.
    Soddee R. Knight Investor from Oklahoma City, OK
    Replied 7 months ago
    What did you buy next?
    Shawn Phillips
    Replied 7 months ago
    Very inspiring article. I'm 25 and looking into the BRRRR method of owning houses and I'm not totally sure where to start except for to save money. Although with student loans I'm not able to actually save up enough money to full out buy a house so I feel a little stuck in the beginning parts of this process already. Thanks for writing this up! I just had a few questions: At what age did you end up buying your first house? Additionally, when you got your loan for your first house did you have any money saved up for the rehab portion or did you use that loan to pay for the rehab process?
    Amanda Gant from Washington, DC
    Replied 7 months ago
    Shawn, a few tips. I started when I was 30, so you can too. Use whichever tips work for you: I was working an entry-level job while attending grad school. Didn't have much savings to my name at all! Here are things I did to get into my first property: 1) Check out first-time homebuyer programs in your area 2) Take a loan out against your 401K (A lender could advise you on how to do that) 3) FHA loans for 2-4 unit properties are great. Always check out how much you could get in rent by seeing what similar units go for on Zillow or Craigslist. 4) To get $$ for my first Down payment and reserves, I paid minimum only on my credit cards (instead of paying them off in full every month) for 6 months, which allowed me to amass enough cash. Some people would say not to do this. However, it worked for me. You can check out Chase's slate card, which has a 0% interest rate for first 18 months or something. 5) Consider becoming a real estate agent, if you like homes. It doesn't cost too much money to become an agent, and you get to make $$ every time you purchase a property for yourself (Not to mention if you help others out!) Staying on top of the MLS will help you realize a good deal when you see one (on or off-market) so that you can confidently jump.
    Casey Burnett from Boulder, Colorado
    Replied 7 months ago
    Well I guess I'm going about this wrong. I'm buying real estate so **I can** live in a car (an not work)....
    Amanda Gant from Washington, DC
    Replied 7 months ago
    If you keep buying real estate, living in a car can be a CHOICE. You can live anywhere!! The dream is yours.
    Mark Berge
    Replied 7 months ago
    Hi good story. I'm focusing on buy and hold for positive cash flow. Not wild about capital gains which has more tax's I've been told. I own two houses now. One was a foreclosure with a hole in the roof which has been repaired and will use a realtor to find tenants. The other one was a shore sale and I'm living in it now while doing repairs. The dogs the previous owners had ruined the carpet and the subfloor which will have to be repaired. Hope to rent this one out and find another fixer upper next year sometime. At least I can live here and will have a room mate paying rent in one of the bedrooms and then, rinse and repeat with another fixer upper.
    Meg Thornton
    Replied 7 months ago
    Hi Mark, You do not need a realtor to find tenants -- at all. I've been renting my properties for 30+ years and have never, ever used a realtor. All you need are good photos of your property and a good description. I used to just post on Craiglist, but have used Zillow to great success in the past 18 months. Just make sure you qualify the tenants. The main way I qualify people is by verifying their income. I also never put a "for rent" sign in the yard, as I don't want to be bothered with people who are not seriously looking and who don't qualify. Via a telephone conversation, I feel out whether a person is qualified before showing them the property. I will note thar taking good photos and writing great ads comes naturally to me because I'm a communications professional, but anyone can do it if you apply yourself.
    Meg Thornton
    Replied 7 months ago
    Hi Mark, You don't need a real estate agent to find tenants. I've been renting properties for 30+ years, and have never used one. All you need are good photos and a well-written description. Then you have to qualify prospective tenants. The main way I do that is by verifying employment. I don't ever even put a "for rent" sign in the yard. My Atlanta tenants are young, computer-savvy professionals. I used to only post on Craigslist, but started using Zillow to great success about 18 months ago.
    Sam Hageman
    Replied 7 months ago
    About two thirds of agents are bone-heads but some can be helpful. I've always found that once I buy a property and start fixing it up; people stop by and ask questions. As an investor, in every town, there are 2-3 banks that get how to do lending and a bunch that are worthless. Ask another real estate borrower who understands the game and who is a time waster. I borrow from both banks and non-bank lenders which is an option for some who do not want to deal with all the regulations and documentation of a traditional bank loan, chop chop! Sam
    Akilah McRoy
    Replied 7 months ago
    Thank you for sharing journey. Although it inspiring I couldn't help but read what you didn't say. You slept in your car not because you had too but because it was a choice and "fun". Now we have lots of people sleeping in cars not because it's fun but because there is no other choice. So st the time you were doing it although challenging as it was it was still better days then today. You also said you did the work. I hope your next blog highlights how you developed that particular skill set. The rest of us who don't would have to hire several people. Next, getting financing with no credit, no income, no collateral ECT....while I know that has been done in the past it feels it's not likely to occur again in the near future. At least for my state anyway financial institutions are asking not only for collateral and extra capital but nearly perfect credit score. Just wondering if you could pivot your discussion to today's environment?
    Amanda Gant from Washington, DC
    Replied 7 months ago
    FHA loans!! Have you tried those, Akilah? They have a lower credit score. You may need to house hack as an owner-occupant in order to get in. Once you've fixed up the house (after 1 year) you can move out and rent it out to get that first cash-flow positive property. It does get easier each property you have. YOu can just do 1 owner-occupied place every year, while you build your property base. That's my idea for you.
    Tim Boehm Investor from Tillamook, Oregon
    Replied 7 months ago
    Wow! very similar to us! We did the same thing except often we would buy, fix and rent. We never really looked at our bank statement, I called the bank the "black hole" and we just kept throwing all our profits into the black hole except when we'd make a buy or need material. I would buy tools to make the jobs go easier, boozakas and banjoys, drywall lift, every tool you could think of, even diamond coring equipment, in most cases it was miles cheaper to buy than rent and when you were done you still had the tool. We separated our accounts, one for building and fixing, one that paid our bills and one that was the nest egg! I was like astounded one day just like you when I added it all up! We never had an earned income over 35k but somehow became multi millionaires! It wasn't always easy but it's been a good ride!
    Jay Hartway Investor from Littleton, Colorado
    Replied 7 months ago
    Ummm... being on the deed for a million in real estate doesn't make you a millionaire. Owning that much free and clear of mortgages does. I love your posts Brandon but this made this business sound way too easy. It actually was pretty easy here in Colorado from 2010 until about 60 days ago. It has only been up, up, up until about 60 days ago. Now we'll see who did things right and hangs on to their investments and collects rents and finds buyers for their rehabs. I agree that things cycle and now (or soon) might actually be a great time to start out, but it will be a different game from our relatively easy start. I benefited from the same timing as you and was also in Denver. It has been hard to lose until now. Highly leveraged players will be shaken off the vine and more opportunities will again exist for those well prepared. This site you've built is a terrific tool, and I definitely appreciate all the guidance and info you provide. Inspiration is part of that, and I have to assume that was your intent with this post. Your answers to some good questions it generated will be interesting too.
    Tamara Simon
    Replied 7 months ago
    You are correct Jay. Debt ratio way too high for many, especially for those over 55 trying to play catch up for retirement income.
    Susan Maneck Investor from Jackson, Mississippi
    Replied 7 months ago
    @ Jay Hartway, I think Brandon knows this. When you are doing a bank financial statement you invariably subtract your debts from your assets. I became a millionaire this year too, then the pandemic came. Then the stock market seemed to forget that and went back up again and I found myself a millionaire once more. Since I knew the stock market was being crazy I cashed in a bunch of my mutual funds. (These are in my retirement so I'm not paying taxes on my sales.)
    Tim Trapp
    Replied 7 months ago
    Hey Brandon, I'm 57 years old and I really appreciate your very Real articles and your willingness to share simple Truths regarding the simplicity of Real Estate. I also appreciate that you are not pushing something to sell, but genuinely enjoy helping others out. It was actually my Son that turned me on to BiggerPockets, and I was very weary of these type of websites because back in my day they would just lead you in with a fancy headline, but then you had to pay more money to get the real information via a book or seminar or whatever. You don't do that and it's much appreciated. I'm in a little different situation as I was born into a construction family. So it was quite natural for me to build my first 4-family when I was 25, which I too could not afford to live in, so I bought a Condominium that was much nicer with Indoor and Outdoor pools and fitness center about 1/2 mile down the street for much less/month. I worked 80 hours a week that whole summer for what I hoped to be my retirement/pension plan 25 years later. I actually was quite conservative in that I never took a penny out of that place (for my own benefit) for the first 25 years. Any extra at the end of the year (or whenever) was just put towards the principal. I actually paid it off in around 18 years or so. When I was 30 I built another 8 family. Again, not taking any money out of the project, just pouring it back into the principal. My wife was a Police Officer, which really helped with Insurance and such, and I remained a Carpenter through the highs and lows of the economy. We enjoyed the benefits of Tax reduction, but that was the only benefit we received. My whole goal was to retire at 50 with my wife (who would have a pension). My wife did retire at 50 while I thought it would be wise to not hang up my belt until I was certain we would be ok financially. This time period coincided with a terrible economy for Construction, which made it real simple for me to not pull a paycheck out of my company. By the end of the year, we had not suffered in the least. Which made it clear that we had more than enough to be able to survive financially for the rest of our days. We have zero debt and a water faucet of money in her pension as well as our rental incomes to still be able to give away 30-40% to charity. We are "The Bank" for our children in order to come alongside them and help them in their dreams of owning real estate as well, which is an added Bonus for them, as well as for us. I think back to that summer of '88 in which we busted our butt for that whole summer, while all our friends were going out to the ballgames and the bars, while,we were building our Future. I envisioned being 50 and "retired" when I was 25. And then I did just that. I was lucky too, but most times we create our own luck. It seems now, more than ever, people want he get rich quick way to success. I just wanted to share that slow & steady works just fine for some of us too. America is the land of opportunity where a simple high school graduate, who's willing to work a little bit harder than his peers, can get ahead quite easily if given enough time. I'm very grateful for that. Keep doing what you're doing. We very much appreciate it.
    Sean Nepomuceno Rental Property Investor
    Replied 7 months ago
    Great stuff! Thanks Brandon. Very inspiring indeed.