I started with house hacking in NJ. My location strategy was being close to train transportation to capitalize on the large commuter base traveling into NYC. Also, I reviewed Google News to find new development projects since I sought appreciation over cash flow.
This led me to a town called South Amboy in NJ. They had received funds to build a new ferry port for commuters, a new luxury apartment building, and redevelopment project for the waterfront area. After a year I rented out the property and have since used a HELOC to invest in other rentals.
You can check out my episode on the Bigger Pockets Rookie Podcast - EP 349 for more info
Great question. Everyone pitches FAST, EASY, NO MONEY..... but that's just not reality for most.
House hacking is the BEST way to get started IMO (I'm bias, however). I've done it twice in Reno, NV and it's changed my life.
I rented by the room and lived with college students for multiple years out of college.
It was not fast, not easy, not fun (at all), and required significant capital. RE is a long term game. Have an end goal in mind and make logical decisions to get there.
Having paid off RE eventually cash flows quite nicely :)
Yes very wise words,I question if I'm risking too much using a HELOC.
Agreed,I will tread lightly and I have real affordable houses about 30 minutes from me.Plan is to start with some flips then take profits into rentals slowly.
Just started last year. I utilized the pandemic to make HCOL wages in a LCOL area and am trying to take the delta and put it into something which generates cash flow because my retirement is essentially fully funded. Bought a turnkey single family off MLS. Did turnover work by myself, which took way longer than I anticipated (due in large portion to family obligations) and got it rented. In the process of closing property number 2. This one needs a little more work so I'll need to pay for some outside help (and to keep holding costs down). The houses are close to zero cash flow after accounting for expenses, but they are desirable areas. I'll probably start looking for property number 3 next year (unless a deal falls in my lap)
Sounds like your in a good spot Peter!I hope to be there some day too.
I started with a subject to flip. I found the property on craigslist so that should give you an indication of how long ago that was .. 2006 - about the age of my profile picture : hahahaha
At the time I had a total of $15,000 cash. We took the house over, finished renovations & turned that into $25,000. Next house was a probate that took 6 months to close : used bank financing and turned that $25,000 to $43,000 ... next we flipped a short sale. Turned that $43,000 into $110,000 : took us about year & a half ... after that we began scaling. Now we flip 20-25 houses per year : I don't want to do anymore than that. We use some of our own cash, a ton of private money, some bank financing, HELOC & direct lenders like Kiavi, RCN Capital. We use our cash for buy & holds & have a portfolio of 32 doors : a few multi family, one corporate rental, 2 short term rentals & the rest are SFH's
Great, it always good to start somewhere.
Not sure if my situation is relevant to your post, because I'm on the mortgage side. But I started the DSCR brokering stuff by accident, truthfully. I found it on Google, thought it was a scam but figured I'd try it anyways for a few months. Closed my first 2 deals 2 months in and then I became obsessed. 3 Full years later and I have 261 closings, totaling $61 million.
One deal at a time should always be the focus. Can't look too far ahead.
Not sure if my situation is relevant to your post, because I'm on the mortgage side. But I started the DSCR brokering stuff by accident, truthfully. I found it on Google, thought it was a scam but figured I'd try it anyways for a few months. Closed my first 2 deals 2 months in and then I became obsessed. 3 Full years later and I have 261 closings, totaling $61 million.
One deal at a time should always be the focus. Can't look too far ahead.
Thanks for the share Timothy!Talk about a success story,very impressive.What part of the country did you achieve this and what types of real estate were you involved with?
Our first project was a flip. This was in early 2016 when there were still a lot of foreclosures on the market and REOs from the aftermath of the 08 housing crash. The property had flooded and had been vacant for quite a while. We paid $76k for a 2/1 house in northern CA. We remodeled it, staged it, and sold it for $135k. We did almost all of the work ourselves. At that time, I don't think anyone was talking about the BRRRR method and it really didn't occur to us to keep it. Looking back, I'm glad we didn't keep it because it was situated on the banks of a creek that does flood every so often and, in fact, just flooded again this year. I'm glad to not be saddled with that headache!
I simply start educating myself from A-Z, lot of challenges but it's part of the process.
I started in 2008 in Milwaukee and bought a duplex for $126,000 and $550 rent. My agent was a super-nice lady, maybe 75 years old and no idea about investing. I was terrified at closing that this would be a huge mistake!
I had no plan, just fixed what was broken and rented it out on craigslist. Could not believe when I actually received rent in the mail.. it worked! Real estate was scary at the time, the news were bad, prices were dropping and nobody knew if that would ever get better.
I had a well paying corporate job at the time (which also meant international travel 2 weeks every m month), so I did not have much time and it also it took me a year to find the confidence and the money for another one. I bought what I could, financed what I could without getting overleveraged, raised private money, did a lot of BRRRR's, some lease options, some flips, built new construction, also got divorced, which wiped me out, but I found a way to keep going. Started building a team around 2014, retired from my W2 in 2015 and got licensed as an agent on a team. 5 years ago I started my own team and we are now top 1% in Milwaukee, I also host a YouTube channel about Milwaukee real estate and I am on the board or the rental property association of Wisconsin, responsible for marketing.
Looking back it was messy and chaotic, lot's of nights and weekends. I always hired contractors, and did material runs for them several times a week after work and cleaned up jobs on the weekend, which was also time I spent at the properties, discovering issues, thinking about the rehabs and what needed to be done next. I don't know how anyone can do a full rehab out of State.
What was important I never took a dollar of cash flow or equity out of the business. To this day we reinvest everything and either upgrade properties or buy more.
Sounds like you hit the ground running.
I did notice something in your post that I was curious about. You mentioned doing quite well and then getting a divorce and it wiping it all out and having to start over. In your opinion, do you think moving so fast in the real estate business had any effect on you getting a divorce?
Hopefully this question is not too personal, but you put it in your post.
Our start was fairly pedestrian. We lived in the same condo for 8 years and reaped the benefits of pretty good appreciation. We moved to a different primary residence with an ADU, and rented the condo out. The ADU brings in 60% of the mortgage for our new place; the condo clears about $700/month. This allowed us to have some freedom to grow and expand from there. We are working through various options and ways to move forward. Our goal is 3-6 doors per year, depending on SFH vs MFH. We are likely going to target value add opportunities.
There are a lot of ways to do this. Think in terms of 10+ years down the road; you will probably save yourself some heartache if you don't try to go too fast.
@Josh Mac- get a free loan pre approval in place for a simple scenario ...this will allow you to begin getting educated / organized and will lead to many more questions
@Josh Mac- get a free loan pre approval in place for a simple scenario ...this will allow you to begin getting educated / organized and will lead to many more questions
welcome !
Not sure if my situation is relevant to your post, because I'm on the mortgage side. But I started the DSCR brokering stuff by accident, truthfully. I found it on Google, thought it was a scam but figured I'd try it anyways for a few months. Closed my first 2 deals 2 months in and then I became obsessed. 3 Full years later and I have 261 closings, totaling $61 million.
One deal at a time should always be the focus. Can't look too far ahead.
Thanks for the share Timothy!Talk about a success story,very impressive.What part of the country did you achieve this and what types of real estate were you involved with?
DSCR loans don't require a license in 46 states, so I was able to market nationwide. My first few closings were Florida deals (I currently live in VA).
I was a former realtor, who after 17 months never sold anything so I gave that up.
@Josh Mac- get a free loan pre approval in place for a simple scenario ...this will allow you to begin getting educated / organized and will lead to many more questions
welcome !
Thank you!
Sounds like you hit the ground running.
I did notice something in your post that I was curious about. You mentioned doing quite well and then getting a divorce and it wiping it all out and having to start over. In your opinion, do you think moving so fast in the real estate business had any effect on you getting a divorce?
Hopefully this question is not too personal, but you put it in your post.
I don't mind. No, it had nothing to do with REI, we just found out very quickly that we were not a good match. But I do believe that it is critical for REI success to have your spouse on board, at least for passive support. I have seen it too many times with investor clients and now I always ask. But I would not say I hit the ground running: I was very excited, yes, but the first years progress was very slow. That is normal BTW, even though the internet is sometimes trying to tell you different.
Success always seems quick, clean and easy from the outside. Almost everyone will tell you this is not what it looks from the inside. It is messy, sometimes chaotic, littered with setbacks, long hours and hard work, all the while you feel you are holding on by a shoestring.
The first one who told me this over a beer at a Xmas party in a rare moment was the owner/founder of the global multi billion $ company I used to work for. He congratulated me to reaching 1,000 excavators sold for the first time in North America and I confessed that I was not sure if we would be able to repeat it next year, because we pulled it together with literally clawing, scratching and biting in th elast minute. He was not a pleasant guy to work for, but he had his moments. His reply: It's always like this, especially in the beginning. Ask me how I know.
@Josh Mac- get a free loan pre approval in place for a simple scenario ...this will allow you to begin getting educated / organized and will lead to many more questions
welcome !
Thank you!
@Josh Mac- welcome
We're still starting but my wife and I found a duplex and started househacking. Hopefully looking for a few more to hopefully cashflow.
We're still starting but my wife and I found a duplex and started househacking. Hopefully looking for a few more to hopefully cashflow.
I would say that's a good start,goodluck!
Started with a foreclosure 3 bed 1 bath house for $21,000, I lived in it and did all the work myself and it appraised for $85,000 and got a HELOC for $45,000. My neighbor was boarding up his house, and I asked what was up. He said "I'm done with this sh*T" referring to rentals. So I bought it for $23,000 and fixed it up, myself again. I pulled another $45,000 out and bought 2 houses from a wholesaler for $48,000, and then just kept going. I own 47 units now and am considering new construction (build to rent). A couple of things I would have done differently would have been to keep my W2 income as lonnnnnnnnnnng as possible, like longer than you think. 2nd would be do wholesale or sell more in the start rather than trying to keep everything possible as a rental.
Started over 20 years ago by buying a second hand Home study course by Carlton sheets. it got me excited and interested, but didn’t have much guidance. Other than that. Was so great I didn’t even know that the course was missing a lot of actual instruction. I simply thought that I didn’t know what I didn’t know.
That’s where i started not where i ended up but that’s a short answer to your title question.
Hi Josh, start from A-Z means educate yourself first and find connections :)
House hacking in the greater Boston area. Got one and that lead to another. Now I’m deciding what direction I want to go next.
Thanks for sharing!Unfortunately house hacking is kinda out of my reach.I have a 3 bed 2 bath primary that my wife and I live in with my 2 adult sons,which need to start investing in there own home by now lol,20 year old and a 23 year old.And my wife loves animals so some of those too.So I come with a lot of baggage to house hack I believe,unless there is a way I am not aware of.Sounds like your off to a great start,keep going forward!
I am currently house hacking a Quadplex. The unit I live in with my wife and daughter is a 3 bedroom 2.5 bath and a garage. The three other units are all rented out.
My husband and I started by saving up our money and purchasing a single family house with 5 bedrooms and a bonus room. We've been househacking it for the past 3.5 years with roommates. Which has allowed us to save up enough money to buy two more STR's! I am now a full time real estate agent and my husband is a full time STR manager
My husband and I started by saving up our money and purchasing a single family house with 5 bedrooms and a bonus room. We've been househacking it for the past 3.5 years with roommates. Which has allowed us to save up enough money to buy two more STR's! I am now a full time real estate agent and my husband is a full time STR manager
Very nice,patience has paid off for you two!Thanks for sharing