Hindsight

7 Replies

Does anyone have any experiences or opinions they'd like to share about how they got started and in hindsight if they would have done it a different way.

I'm new to REI and would like to hear peoples opinion on the best way to start off. I have no experience what so ever in the industry so I want to start off slow and make sure I do it right from the beginning. I'm in Chicago and have about $35k I can put in. My initial thought was to buy a multi-family home, preferably 3-plex that doesn't need renovations and owner occupy it. That way I could get used to owning a place and also being a landlord. Then buy one unit a year for the next two years. Another option I just started researching is buying something larger, no more than 10 units though, and hiring a PM (I currently have a full-time job). I'm afraid that may be to much to quick though.

Thanks in advance for your responses!

Tim

@Tim Coppola   I am just starting out myself. I would recommend listening to the BP Podcast! In every episode successful investors explain how they got started, mistakes they made, and what they're currently doing to be successful. After the first episode you'll be hooked! Then just scour the forums and you'll learn about every aspect of every strategy you mentioned above. 

In the podcast Brandon Turner is a big fan and talks a lot about the strategy of starting out in multi-family and being an owner-occupant. 

Good Luck!

Hey Tim, 

Not sure $35 will get you much in Chicago land, But there is no wrong or right way to get started Tim. When you buy a SFH they have more risk for rental but are normally easier to sell. A double or up to a 4 are much safer when it comes to renting but are normally harder to sell. Flipping is risky if your first starting out especially if you have no hands on mentor, but that is a great way to build cash quicker. Lrg complexes are always the best way to go instead of SFH or up to Quads but again can be more difficult to sell.

I would say you need to just pick one and get started based on your immediate goal or needs. I personally have a mix of investments going on that all bring in $$ at different times and levels and I'm out of at different times. Hope this helps. Good Luck,

@Tyler Vining  Thanks. I've just started listening to the podcasts. There's a ton of good information on those.  Eventually I'll get through them all.  Good Luck to you as well!

@Account Closed   Thanks for the advice.  Is it possible to buy a 3 or 4 unit and start by renting them out but eventually sell them off one by one?  

@Tim Coppola  

Welcome to BP - You stated that you wanted to be an owner and a landlord - I'm guessing this is within the one purchase. I would suggest choosing an are that you can afford a duplex or two flat that you are willing to live in and go for it. The only thing I would have done different myself is due diligence on screening a tenant and not renting immediately to have an income.

Good luck and keep us informed on your journey.

Tim

@Timothy Riley  

 Thanks for the feedback.  I definitely need to look more into screening for tenants and making sure I get the right one.  

Originally posted by @Tim Coppola:

@Tyler Vining  Thanks. I've just started listening to the podcasts. There's a ton of good information on those.  Eventually I'll get through them all.  Good Luck to you as well!

@Sydney Chase  Thanks for the advice.  Is it possible to buy a 3 or 4 unit and start by renting them out but eventually sell them off one by one?  

 @Tim Coppola

Yes you can, Just remember it can take longer to sell those. Are you renting now? if so you may want to think of the living in one. If your credit is good and you have to down payment I would look at a 4 unit live in one.

Looking back, I wished I had put more focus on these things:

1) Education: Consciously & consistently improving my skills & becoming an expert in a specialized area or niche.

2) Drastically reduce living expenses early: The lower this is, the sooner you get out of the rat race.

3) Prioritize finding deals that will generate consistent long term income or "mailbox money" vs. one big score, or one check paydays. (holding vs. flipping).

4) People: Seeking & consistently nurturing deeper relationships with people with a long term approach.

5) Mentor(s):  Making it a habit to be around people who I admire & want to emulate.

6) Acquiring or trading up to "higher quality" long term assets as soon as possible.

7) Never stop looking for deals & making deals: Even when you don't have money or are fully invested.  Always, always, keep looking for deals & make it known to everyone what you are looking for.

Medium realgroup360 480x270Ellis San Jose, Real Estate Group 360-The Note Guys | (805) 852‑7418 | http://www.realestategroup360.com

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