Ready to find your first investment property?

Question

Welcome, new members! It's fantastic to see the Bigger Pockets community growing with enthusiastic individuals eager to take the plunge into real estate investing. For those gearing up to buy their first investment property but haven't quite made the move, I'd love to hear about the challenges you're facing.

Are you navigating the intricacies of market analysis, dealing with price or financing concerns, or unsure about the best investment strategy for your goals?

Feel free to drop your questions or share your experiences below. The Bigger Pockets community is a wealth of knowledge, and together, we can navigate the exciting journey of real estate investing. Cheers to your success! 🚀🏡

Justine Phillipson · Answer

Swati, congrats! It sounds like you've been educating yourself and working on saving a good amount to get started. What market are you located in? I honestly feel like the first deal is always the hardest. No matter how much you prepare yourself, you'll question if you're actually ready. But real estate is the long game, and the sooner you can safely get started- the better!

I started my real estate journey in 2020.I was 25 years old, and living in San Diego. I had about $25,000 saved up. I had been studying real estate for about 3 years before I finally pulled the trigger. I didn't have any mentors and had no idea what I was doing. I was working fulltime as a Recruiter.

I had learned everything I knew from Bigger Pockets, Youtube and online research. I was priced out of the California market. So after studying many markets, I settled on my first single family rental in South Bend, Indiana. The purchase price was $62,500. I paid a 25% down payment. The house came with tenants, so it was cash flowing from day one. Those tenants are still in place.

I bought my second property in South Bend in 2021. It was $70,000 and I did a 20% down payment. My property managers found a tenant within 3 weeks and those tenants are still there. It also is cash flowing well!

I bought my third property in 2022. That is my current residence, a condo in Scottsdale Arizona (where I currently live). I've spent the past two years doing a complete remodel, and I plan on turning it into a rental one day!

In 2023 I got completely burnt out of my corporate recruiting job. My mental health was suffering and did some soul searching to figure out my next move. I reevaluated my passions and goals, and kept coming back to real estate investmenting. I quit my job and got my real estate license in November 2023 and started at the investment firm New Western. I closed my first deal as an agent in December 2023!

Now it's January 2024, I am 30 years old, and I am so optimistic to see what is coming. My goals for this year are growing my network, and close some deals so I can hopefully do my first flip!

My messages are always open for new people who need help getting started!

Swati Yadav · Answer

Hi Justine and rest of BP family,

Thank you for posting this.

I am located in Dallas, Tx and have been thinking about starting  real estate investing from quite a while. I dnt have any past experience with it and dnt know exactly where to start. I am full time healthcare professional and mother of two beautiful girls. I have been listening to BP podcasts and about to finish David's book on BRRRR.

Due to so many RE training courses available everywhere online, it seems very overwhelming what to pick and fear of getting ripped off. As a newbie , I need suggestions about initiating this journey. I am interested in BRRRR strategy but with zero RE experience I am afraid that I might end up taking way more wrong decisions than I can afford. I have 50 K to put on a down payment and I am open to out of state investing after getting little hang of it locally.

I am not looking for high amount of cash flow and focusing more on property appreciation and wealth accumulation.

I also wanted to Ask busy professionals with none or limited REI knowledge about their beginning of investing journey, how did you navigate this process, any courses you recommend, how did you find your mentors and what challenges you faced and troubleshooting them.

Any help and feedback is highly appreciated!

Hamp Lee III · Answer

I started with owner occupied homes. It made it easier to get started. I own three rentals and my primary home, but now looking to branch out into fix and flips for first-time (and low income) homeowners.

There are a lot of great programs for first-time homeowners.

I would first recommend viewing the BP podcasts to find the investment type that interests you, as well as joining a local (and legit) real estate investing association. I also suggest that you don’t spend a lot of money on courses right now. Identify your goals first.

I wish you all the best.

Justine Phillipson · Answer

I agree with everything Hamp Lee says! I never paid for any courses, and they can be pretty expensive. Before purchasing a course, I would do a lot of due diligence to make sure it's not a cash grab and would actually add value. In my opinion I think you have all the free tools available!

Paul Wheeler · Answer

I'm in a very similar situation to Swati (and we've actually touched base in BiggerPockets here as "fellow newbies" in DFW!!) (I hope I am not hijacking your thread Swati!!)

From a market standpoint, I am interested in LTR, both SFR and MFR (although reading through the 2024 market outlook here on BiggerPockets, MFR could be a tough market this year??) Cash flow is definitely a key metric, as I want to accelerate equity ownership in many property I own as quickly as possible..mainly to be able to re-invest and get my next property, but its not everything..if the underlying area is good and I can expect the property value to grow (beyond market?) then great.

Longer term (maybe) BRRRR (which phonetically feels very relevant in DFW) : Personally I like the process of updating properties etc, gives me a lot of satisfaction, but I'll need to keep in mind its a business so some level of training and discipline will probably be needed before jump in here.

In-state / Out-of-state : open to either and that will really be determined by the support network I can find/create (trusted realtor, property managers etc..)

Excited to hear more from the BiggerPockets community on how to build that experienced network and make that first deal...feels a little like cold-plunging..the first one is probably the hardest (just making the plunge) and no doubt i will be breathing heavily for a while, but after a bit, you get used to it??

Justine Phillipson · Answer

All really valid sticking points. Cash flow is really difficult for many markets right now. In Phoenix, cash flow and buy & hold used to be the top investing strategy. But there's been a major shift in investor strategy adjusting to the market and now 90% of the investors I work with will only do flips, and then they sell it.

I'm going to send you a private message. I would be really interested to learn what markets you're targetting

Fiz Sam · Answer

Hi there!! Thanks so much for raising this subject, this sort of conversation is why BP is the greatest community.For context, I am an out of state investor looking for a 2-4 unit investment property.

Here's some of the challenges I'm facing:1. Most properties are priced well-above breakeven cashflow

2. Low inventory environment so not a lot to choose from

3. Hard to determine what neighborhood is the best for long term appreciation

4. Seems so many properties are designed for short term rentals when i'm looking for low tenant turnover investment

Swati Yadav · Answer

Thanks Hamp. You mentioned about owner occupied homes, do you mean house hacking by that?

Swati Yadav · Answer

Thank you so much for sharing your experience in so detail. It is really encouraging. Please check your messages. Thanks again!

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