Young Aspiring Investor - Ready to Take the First Step but...
LA · Member since 2021 · 19 posts · 6 votes
Young Aspiring Investor - Ready to Take the First Step but...
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Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
4yWelcome to BP and congratulations on your first post!
I don't see a specific question, so I don't have a specific answer. Running the numbers is not that difficult, but you have to practice it. Reading a book or listening to podcasts isn't enough. Visit the BP YouTube page and they have a channel dedicated to property evaluation. It walks you through the process step-by-step. Do at least 10-12 of those exercises. Pause the video and try to think what the next step will be before they say it. When you get that down, then you can evaluate on your own. And once you know how to evaluate, you should know what a property needs to produce to be a good investment for you.
Have you joined a local investor meetup to network with others? Spend time rubbing elbows with like-minded investors and they can help you find a deal. They may look at a 5bed/3bath house and it won't cashflow for them, but it will cashflow for you since you're renting out each bedroom. Build a network and you'll have more than just your eyes looking for deals.
The DIY Landlord Book4.7248 Reviews
13 Replies
- Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes4y
Welcome to BP and congratulations on your first post!
I don't see a specific question, so I don't have a specific answer. Running the numbers is not that difficult, but you have to practice it. Reading a book or listening to podcasts isn't enough. Visit the BP YouTube page and they have a channel dedicated to property evaluation. It walks you through the process step-by-step. Do at least 10-12 of those exercises. Pause the video and try to think what the next step will be before they say it. When you get that down, then you can evaluate on your own. And once you know how to evaluate, you should know what a property needs to produce to be a good investment for you.
Have you joined a local investor meetup to network with others? Spend time rubbing elbows with like-minded investors and they can help you find a deal. They may look at a 5bed/3bath house and it won't cashflow for them, but it will cashflow for you since you're renting out each bedroom. Build a network and you'll have more than just your eyes looking for deals.
The DIY Landlord Book4.7248 Reviews - LA · Member since 2021 · 19 posts · 6 votes4yThank you so much! This was very helpful, and you also answered many of my follow-up topics regarding networking and such. I really appreciate your input and find it actionable - I will keep you posted on the progress!
Quote from @Nathan Gesner:
Welcome to BP and congratulations on your first post!
I don't see a specific question, so I don't have a specific answer. Running the numbers is not that difficult, but you have to practice it. Reading a book or listening to podcasts isn't enough. Visit the BP YouTube page and they have a channel dedicated to property evaluation. It walks you through the process step-by-step. Do at least 10-12 of those exercises. Pause the video and try to think what the next step will be before they say it. When you get that down, then you can evaluate on your own. And once you know how to evaluate, you should know what a property needs to produce to be a good investment for you.
Have you joined a local investor meetup to network with others? Spend time rubbing elbows with like-minded investors and they can help you find a deal. They may look at a 5bed/3bath house and it won't cashflow for them, but it will cashflow for you since you're renting out each bedroom. Build a network and you'll have more than just your eyes looking for deals.
- 4yDan SheeksPro MemberRental Property Investor · Denver, CO · Member since 2016 · 621 posts · 362 votes
Congrats on your ambition!
Bigger Pockets recently published a book that's perfect for you! It's called First to a Million. You should check it out! If you have questions about the book, let me know. I am the author. :-)
In addition, DM me if you are interested in an online community of young, like-minded individuals.
Best of luck to you!
Dan
- Rental Property Investor · Columbus, OH · Member since 2017 · 3k+ posts · 3k+ votes4y
Quote from @Christian Sabatini:
Hello, I'm a 20 year-old aspiring investor. I've taken courses, listened to the podcast for a year, done a lot of research, etc. and I feel that I'm ready to take the first step in real estate investing. With that, naturally I'm having my doubts - I don't want to throw my money into a home for the sake of doing it.
I'm looking to house-hack since I'm in college and I can mitigate the risk of vacancy as well as get tenants I already know in the house - avoiding the bad tenant experience. My biggest concerns are (1) running numbers (i.e. what am I looking at, what are good numbers, what's important criteria, etc.) and (2) I've understood and appreciated the concept of "creating - not finding - a deal", and I'm seeking some pointers as to what are some of your personal favorite value-add techniques.
Thank you so much!
Hi Christian,
I always recommend going over the local market and getting used to doing numbers. I like using this calculator https://www.calculator.net/ren... I always tell my clients to just keep analyzing deals and doing numbers. The more you do this the more familiar you will be. Find a good realtor! It is their job to help you. Find a mentor who can help guide you. One of my mentors was kind enough to go over all of my plans with me and walk my property periodically throughout the renovation process to make sure what I was doing was good.
- 4yBruce WoodruffPro MemberContractor/Investor/Consultant · San Diego / Phoenix · Member since 2021 · 12k+ posts · 15k+ votes
1) Running numbers is not that hard. It is sufficient (at least for starters) to go on the various platforms and run comps based on
2) The best way I've found to 'add value' is to find the properties that no one else wants - distressed, filthy, cracked slabs/foundation, structural issues, etc...../ But these are also the hardest to run to completion 'on budget and on time'.
Good Luck!
- LA · Member since 2021 · 19 posts · 6 votes4yThank you so much for the input, Dan! I would love to give your book a try. Willing to learn any way possible.
Quote from @Dan Sheeks:
Congrats on your ambition!
Bigger Pockets recently published a book that's perfect for you! It's called First to a Million. You should check it out! If you have questions about the book, let me know. I am the author. :-)
In addition, DM me if you are interested in an online community of young, like-minded individuals.
Best of luck to you!
Dan
- LA · Member since 2021 · 19 posts · 6 votes4y
Quote from @Steven Foster Wilson:
Quote from @Christian Sabatini:
Hello, I'm a 20 year-old aspiring investor. I've taken courses, listened to the podcast for a year, done a lot of research, etc. and I feel that I'm ready to take the first step in real estate investing. With that, naturally I'm having my doubts - I don't want to throw my money into a home for the sake of doing it.
I'm looking to house-hack since I'm in college and I can mitigate the risk of vacancy as well as get tenants I already know in the house - avoiding the bad tenant experience. My biggest concerns are (1) running numbers (i.e. what am I looking at, what are good numbers, what's important criteria, etc.) and (2) I've understood and appreciated the concept of "creating - not finding - a deal", and I'm seeking some pointers as to what are some of your personal favorite value-add techniques.
Thank you so much!
Hi Christian,
I always recommend going over the local market and getting used to doing numbers. I like using this calculator https://www.calculator.net/ren... I always tell my clients to just keep analyzing deals and doing numbers. The more you do this the more familiar you will be. Find a good realtor! It is their job to help you. Find a mentor who can help guide you. One of my mentors was kind enough to go over all of my plans with me and walk my property periodically throughout the renovation process to make sure what I was doing was good.
I have actually just finished my pre-licensing studies, and getting ready to take my licensing exam soon! I’m looking to learn that side of the business.
I am beyond grateful for your advice! Thank you!
- LA · Member since 2021 · 19 posts · 6 votes4yThank you so much for your input! I completely understand the value-add point, and agree with you on the downside that can incur when looking at homes like those. I will update you on the progress!
Quote from @Bruce Woodruff:
1) Running numbers is not that hard. It is sufficient (at least for starters) to go on the various platforms and run comps based on
2) The best way I've found to 'add value' is to find the properties that no one else wants - distressed, filthy, cracked slabs/foundation, structural issues, etc...../ But these are also the hardest to run to completion 'on budget and on time'.
Good Luck!
- Real Estate Agent · Member since 2021 · 7 posts · 2 votes4y
Quote from @Christian Sabatini:
Hello, I'm a 20 year-old aspiring investor. I've taken courses, listened to the podcast for a year, done a lot of research, etc. and I feel that I'm ready to take the first step in real estate investing. With that, naturally I'm having my doubts - I don't want to throw my money into a home for the sake of doing it.
I'm looking to house-hack since I'm in college and I can mitigate the risk of vacancy as well as get tenants I already know in the house - avoiding the bad tenant experience. My biggest concerns are (1) running numbers (i.e. what am I looking at, what are good numbers, what's important criteria, etc.) and (2) I've understood and appreciated the concept of "creating - not finding - a deal", and I'm seeking some pointers as to what are some of your personal favorite value-add techniques.
Thank you so much!
Hey Christian! It's awesome that you are taking initiative to early. I am an advocate for house hacking - especially as a college student before a family. Running numbers isn't the hard part, however I would encourage you to understand the numbers you're running. Remember with no risk there is no reward! Best of luck.
- LA · Member since 2021 · 19 posts · 6 votes4yThat is true! Thank you so much!
Quote from @Meadow Orrell:
Quote from @Christian Sabatini:
Hello, I'm a 20 year-old aspiring investor. I've taken courses, listened to the podcast for a year, done a lot of research, etc. and I feel that I'm ready to take the first step in real estate investing. With that, naturally I'm having my doubts - I don't want to throw my money into a home for the sake of doing it.
I'm looking to house-hack since I'm in college and I can mitigate the risk of vacancy as well as get tenants I already know in the house - avoiding the bad tenant experience. My biggest concerns are (1) running numbers (i.e. what am I looking at, what are good numbers, what's important criteria, etc.) and (2) I've understood and appreciated the concept of "creating - not finding - a deal", and I'm seeking some pointers as to what are some of your personal favorite value-add techniques.
Thank you so much!
Hey Christian! It's awesome that you are taking initiative to early. I am an advocate for house hacking - especially as a college student before a family. Running numbers isn't the hard part, however I would encourage you to understand the numbers you're running. Remember with no risk there is no reward! Best of luck.
- Realtor · Spokane, WA · Member since 2020 · 138 posts · 87 votes4y
Quote from @Christian Sabatini:
Hello, I'm a 20 year-old aspiring investor. I've taken courses, listened to the podcast for a year, done a lot of research, etc. and I feel that I'm ready to take the first step in real estate investing. With that, naturally I'm having my doubts - I don't want to throw my money into a home for the sake of doing it.
I'm looking to house-hack since I'm in college and I can mitigate the risk of vacancy as well as get tenants I already know in the house - avoiding the bad tenant experience. My biggest concerns are (1) running numbers (i.e. what am I looking at, what are good numbers, what's important criteria, etc.) and (2) I've understood and appreciated the concept of "creating - not finding - a deal", and I'm seeking some pointers as to what are some of your personal favorite value-add techniques.
Thank you so much!
Welcome to BP, Christian! That is so awesome that you are thinking about investing soon! It is fine to have some doubts sometimes. But personally, I think that real estate is one of the safest long term investment there is. You just got to go for it, if you feel like you are ready!
- 4yJared HottleBusiness MemberReal Estate Agent · Cedar falls IA Waterloo, IA · Member since 2020 · 902 posts · 549 votes
@Christian Sabatini this is exciting. I think a college kid house hacking is one of the best competitive advantages to get started. You know the areas students want to live, you know a bunch of prospective tenants, and you know what they and you have been paying for rent in that area. If/when you move you can always keep renting to college kids or just sell it. I think you are right that creating a deal is better than finding one. I would walk or drive for dollars in areas you want to live and look for a duplex or a smaller house that needs some cosmetic work (bad landscaping, older siding, long grass, etc) and contact the owners. There are some loan programs out there that let you get a loan and a construction line to fix things up. If not, see if you can find something that just needs paint/flooring/light fixtures as those can be very cheap to update. Work out a deal with them based on the mortage terms you have and what you can get for rent. Start today, you can always say no if it isnt the right deal for you but most do not start.
Jared Hottle Real Estate59 Reviews - LA · Member since 2021 · 19 posts · 6 votes4yThank you so much, this is very helpful advice. I was thinking of going the FHA route - putting 3.5% down. In doing so I was hoping to find a home that could use some easy and cheap fixes (i.e. landscaping, newer fixtures, maybe cabinets/paint - small interior changes) and build some equity through a refinance down the line. I guess it’s a song of BRRR, but ultimately it’s because I have two years left of college and I plan on moving away after I finish school. Again, thank you so much for the input, it makes a lot of sense and was extremely helpful!
Quote from @Jared Hottle:
@Christian Sabatini this is exciting. I think a college kid house hacking is one of the best competitive advantages to get started. You know the areas students want to live, you know a bunch of prospective tenants, and you know what they and you have been paying for rent in that area. If/when you move you can always keep renting to college kids or just sell it. I think you are right that creating a deal is better than finding one. I would walk or drive for dollars in areas you want to live and look for a duplex or a smaller house that needs some cosmetic work (bad landscaping, older siding, long grass, etc) and contact the owners. There are some loan programs out there that let you get a loan and a construction line to fix things up. If not, see if you can find something that just needs paint/flooring/light fixtures as those can be very cheap to update. Work out a deal with them based on the mortage terms you have and what you can get for rent. Start today, you can always say no if it isnt the right deal for you but most do not start.
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