Is there a single property purchase that really changed things for you?
I know there was for me. I think we all have a pivotal real estate deal that we can point to that really changed the dynamics of our finances, mindset, and probably our lives as well.
More importantly, is there a common theme in this one critical deal that successful investors point to as being the game changer that others can learn from?
What was it—or what will it be—for you? The one with the biggest profit? The smoothest transaction? Biggest learning lesson from failure?
My Game-Changing Property Deal
For me it was definitely my first deal. It’s something I hear from other successful real estate investors too.
Most often it is because that first deal completely blows their minds, changes their perception, and provides insight to the power of investing in real estate. They gain a whole new appreciation for what’s possible. Then they are hooked for life.
It was a little different for me. My first deal allowed me to get over that analysis paralysis hurdle and learn so much through the process from managing contractors, leasing, property management, working with a title company to close transaction and negotiations. I learned so much more about what’s involved in the process than I knew was there. It gave me a ton of confidence to do more, and it showed me what was possible.
I hear so many excuses for why people choose not to get started in real estate — even when they know the benefits and that they need it. I got started on the investing side with no money and at 22, which was only 6 years ago after working multiple years in construction. I had negative money in my bank account and bad credit. I overcame and solved those problems by leveraging someone else and helping them. The problem I solved for them was they couldn’t find a deal and had no time to do so.
I structured the deal so that I retained a 10-percent equity stake instead of taking a simple wholesale fee. I thought long-term. The total purchase price was $25,000 cash, and an additional $25,000 was put into it. We rented it at $850. That property is now worth $100–$110k. In hindsight, I wish I bought a lot more during that time.
My Second-Most Important Deal
More recently I experienced another major game changing deal. I wouldn’t have gotten this far without the first single-family deal, but this also really changed my world. This was my first multifamily apartment building deal.
This again changed my understanding of money, the dynamics of real estate, and the economies of scale. Again I partnered up with some others for the funding, and have since steam rolled into focusing primarily on this new asset class.
Ways to Get Started
Maybe you haven’t gotten started yet. Maybe you’ve allowed yourself to be stuck with some of the same excuses, like not having enough money, credit, time, or knowledge.
Some ways to break in and do your first deal might include:
- House hacking by buying a small multifamily to live in and rent out
- Creative financing like lease options
- Real estate wholesaling to build up your own investment capital for rentals
- Partnering up with others
- Investing in an experienced operators deal
My first deal will always be my most important. Although, there will be others that really help you make leaps, too. It can be easier than you think to get started if you apply a little creative problem solving.
What was your most important deal?
What will you do to get started? Share with us below!