Flipping Houses

4 Tips to Find Your Niche in Real Estate (& Actually START Investing!)

2 Articles Written

You’ve read the books, listened to the podcasts, and suddenly you want to start investing in real estate. Great! Now what? How do you carve out a niche for yourself?

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It seems scary because there so many options: flipping houses, wholesaling houses, buying and holding houses, tax sales, rehabs, corporate real estate, multifamilies, etc. And every week, a new podcast comes out with a successful investor in any of these areas and you think, “That’s it! I’ll do that!”

I was a victim of this, and I’ve tried a lot of verticals in real estate. I’ve flipped houses, I’ve been a wholesaler, and now I focus on turnkey buy and hold. So I know a little something about finding your path, and I hope I can share that with you.

Here is my advice for identifying a path that works for you.

4 Tips to Find Your Niche in Real Estate (& Actually START Investing!)

1. Reverse Engineer Your Life

You know you want to make good money, but you’re not sure what that successful life looks like outside of your bank account. Here is your pivot point: Don’t chase money, chase dreams. My life totally changed for the better when I started visualizing the life I wanted for myself and my family. Your real estate journey should start here.

Do you love being a contractor? Do you love picking out windows and paint colors? Do you love dealing with buyers and sellers? If these things are part of your passions, maybe rehabs and flips are for you!

Or is a lifestyle of passive income what you are after? No shame in that. I aimed to create more space and time in my life. I wanted to spend more time with my family, reading books, playing guitar, and traveling the world. There was no way that flipping houses would get me there. Flipping houses is a full-time job. Most flippers I know spend six months on a light rehab and up to a year or more on a big, custom home. That doesn’t leave a lot of time for other things.

Related: How to Assess Your Risk Profile to Know Which Real Estate Niche is Right for You

Meanwhile, a few of my investor friends own more than 100 homes, and I saw them spending time in their gardens, traveling to Greece for a month, and relaxing. Their homes were producing cash flow while they were sleeping. For me, it was an easy decision — buy and hold all the way.

Think about what your successful real estate journey looks like once you are already successful, and reverse engineer how to get there.


2. Follow Your Gut

If you have read Malcolm Gladwell’s book Blink: The Power of Thinking Without Thinking, you know the premise I’m getting at here. Most of the time, we already know what is right for us from our gut reaction. Unfortunately, we are also really good at talking ourselves out of those gut decisions.

Here’s a powerful tool to help you follow your gut instincts. Grab a piece of paper and pen and write out a simple yes or no question. Example: Should I start rehabbing houses? Should I go back to law school? Yes or no. And leave this question in a room that you’ll come back to later. Don’t answer the question yet. Wait. Get the question out of your head.

Hours later, you might stumble across this written question on your kitchen table. You probably forgot you even wrote it down. Now read it and grab the pen and answer the question immediately. Yes or no. Your body already knows the answer before your mind gets in the way.

Even though you may not have a clear path, you now know where your curiosity lies. These gut feelings are tied to your motivations, and this is what separates you from other people. I have found these gut feelings tend to feel scary and totally off the wall, but when I’ve followed them, I’ve experienced dramatic shifts in my life.

3. Fail Fast

There’s no shame in changing course after you’ve screwed up! My wife likes to say that I try a lot of things before I find the thing that sticks. When you try a lot of things, you’re bound to make mistakes and there’s nothing wrong with that. Just make sure you dust yourself off and make a course correction.

Related: What All Newbies Should Consider BEFORE Choosing a Real Estate Niche

You can only learn from a mistake after you admit that you’ve made it. Losers blame others for their mistakes. Winners learn from them. I overpaid for my first buy and hold property. I spent too much on the house, too much on the rehab, and too much on insurance. I didn’t blame the real estate agent, the contractor, and the insurance agent. I used them as lessons on how to do it better the next time.


4. Money Shouldn’t Be Your Obstacle

I’ve heard this a lot, too: “I’m going to save up some money, and then I can get started.”

Money is not a roadblock. Money is a manifestation. I believe that. If you are serious, you will find the money. You already know from podcast after podcast that there are amazing investors who did not start with their own money. You know that money can be a result of your own creativity. Lack of money is not an excuse.

Now, imagine what you will do when you get the money from investor partners. Will you head to Home Depot and start picking out rehab supplies? Will you make a list of turnkey properties that you want to own? Will you buy a list of out-of-state owners to start a mailing to?

Start a to-do list as if you have the money, and you’ll know where you truly want to invest your time and effort.

The point is to start planting the seeds in your real estate business now! The winds of our economy are turning, and our business will favor those that are IN IT. In the immortal words of Edward Stark: Winter is coming.

Where are you in your journey to begin investing? How are you going about deciding on your niche?

Let me know your questions and comments below!

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Clayton is a news anchor on America's number one morning show "Fox and Friends" and a rental real estate investor. He's passionate about helping busy people get started in real estate investing with his turn-key rental company Morris Invest. He loves helping investors reach their financial freedom number with rental properties. You can download his free cheat sheet here. He's also the host of his very own real estate investing podcast called "Investing in Real Estate" where he interviews great buy-and-hold investors like BiggerPockets' Brandon Turner and case studies from newbie investors with one property under their belt.

    Anthony Geren from Spring, Texas
    Replied almost 3 years ago
    right now @Clayton Morris im in the education phase, just got done with the UBG and now working my way through the guide by getting more info on the things i dont know about. Im into buy and hold, and flipping at this moment. Maybe down the road when i get the network bigger go into the other ways like wholesaling.
    Timothy F.
    Replied almost 3 years ago
    I fail constantly. Best way to learn, hard though it may be. Nice one, Clayton.
    Peter Mckernan Residential Real Estate Agent from Newport Beach, California
    Replied almost 3 years ago
    Hey Clayton, Great article, the first key point is to reverse engineer where you want to be! Gary Vaynerchuk speaks on this point all the time, and I love how you captured it very perfectly there! I have found the niche that I will pursue, and now I am building the team of investors. I worked on different areas like you did. Buy and hold, flips, and I have stuck to something that has driven my from the first day I heard it, apartment investing! Keep up the great content!
    Nick McDonald from Nassau, New Providence
    Replied almost 3 years ago
    Awesome article! I’m new to this concept and even newer to this site lol. But what I’ve read here has definitely helped in pointing me in the right direction mentally!
    John Mathewson from Schererville, Indiana
    Replied over 2 years ago
    Great article! I think this is so so important for investors just starting out finding the right niche is so important when just beginning.
    Derek DeCo from Joliet, Illinois
    Replied over 2 years ago
    Must agree great article and plan on being there for the webinar. Like a few here I’m as green as they come when understanding the intricacies of REAL Estate investing. My goal or niche will be very lucrative to many investors willing to jump in with smaller more attainable or affordable investments in mind and all based around multi-family or apartments within low income demographic locations. I really have my goals set on working with those with real needs by offering them greater opportunities like employment within the community and options to make it easier for them to qualify with the possibilities of home ownership or investment opportunities within the my company or other investments as the years progress and their credit worthiness improves. My goal is to help those that are less fortunate, struggling to make ends meet etc. we heard all the stories I’m sure but I am 100% committed in making this a reality by use of 1031 exchanges that allow investors to realize a positive ROI and helping the less fortunate. All great reasons to get involved as a partner or strictly for investment purposes. Got my Property Management LLC registered with the state and fed entities, have several reits in my portfolios, and currently invested in a large cap crowdfunding 1031 exchange at the moment but my goals are to personally begin my own property management coupled with Real Estate investing into more properties all within this identical criteria and processes. I would gladly accept any constructive criticism by my fellow investors, I look at these inputs as important factors in educating, enlightening and broadening my horizons. I do not like using the term but as dictated through the SBA I fall into the minority category as well as a retired civil engineer being a 100% disabled veteran certified in Transportation, Project and Facility management and was in command of 72 personnel that I’ve directed on a daily basis on maintaining base operations from A to Z and I feel it’s time that I do something with the money I have invested and put my skills and expertise back to work after spending the past 6 years going through surgeries that I am just about cleared from my doctor to go back and do what I’ve been incapable of doing due to my injuries and I know I believe I made the right choice in returning back to work but this time as an employer. Thanks for reading my babbling and have a great day everyone! Peace Ya’ll.
    Willie Morales Investor from New York City, New York
    Replied almost 2 years ago
    HI Clayton I Like this article, but Have to be honest, how can someone find the money for a deal, if there is no investing credibility yet? The only thing I can think of that a lender will work with you is if you have good credit, maybe a 401k, something that can ease the lender’s concern that you have some type of asset besides the property, I always here find the deal and you find the money. What do you think Clayton ? can use your expertise.