Advice on how to start investing in real estate
Hey guys! I am looking for some advice in regards to beginning to invest in real estate. My wife and I already own 1 rental property. However, after 2 job losses between 2009 and 2011, our savings are gone and we are starting over financially. Any advice on the best way to start? My initial thought was to look for wholesaling opportunities for short term cash, and add buy and hold properties to build long term wealth.
Mark Dunn
Hey Mark,
I understand how that can feel. I too had to start all over and I didn't have cash to do it. Wholesaling is a great way to get into the business or back on your feet. There's many resources out there to learn from in this arena. What I did to get back in when my cash was low, was getting back into the rehabbing side of the biz. I found a property that was on the mls. I then found a hard money lender who would finance the deal. He gave 90% of acquisition an 100% of the rehab cost. (Pricey though). Then I posted an add looking for a down payment partner. I offered them 50% of the profits. The numbers worked for everyone and the end result was great. I did this a few more times afterwards sometimes offering a 70/30 split my favor or a 60/40 split my favor, and it worked out for everyone. Hope this was some kind of help to you.
All the best
Corey
If you have income, consider financing some flips with hard money, perhaps with a partner
Another route would be to look into mobile home rentals. I know they aren't a sexy investment like stick built homes, but they can be cash cows. I've had one mobile home for 20 years now that has paid for itself more times than I can count now. They don't appreciate, but they do cash flow. Of all the properties I own, the mobiles are the easiest and most profitable on a monthly basis.
thanks for the responses! I have a good friend that spent some time flipping houses. I also have a few friends that are real estate agents. I am hoping to spend some time with them trying to gain a better understanding of the best route to start. Austin, we have many mobile homes in my area. That might be a great place to look. Thanks for the help!
Mark
Mark Dunn I think the best way is to build your financial base, specifically your personal finances. Create a budget, learn to live on less, chop down any personal debt like credit cards and such, and just plainly get in control of your finances. After you do this, build a 6 month emergency fund for cushion. While your building the emergency fund, get out to your local REIA, meet and hang out with some landlords who are actually doing business and pick their brain, go on some repair calls with them just to help, learn, stay in the loop of things. You might just build some rapport with someone that can help you find a good deal and even help you finance it as a private lender. You just never know, that's why you got to build your foundation first and get in a position of control. Get out there and hang with some folks that know the market and learn it real well. Once you know what the market looks like and how it moves, you can then find/spot deals based on your experiences with the landlords your hanging with. This is what I did. Good luck
@Mark Dunn for a first step start learning your local market now. You will not be able to know a good deal until you have really studied the market. This is true weather you are going to flip or wholesale to another investor. If you have gone to your local REI clubs and networked, then you stumble across a killer deal you know who to call to start looking for a buyer.. Good luck. Be sure to browse through the Learn section above too. it has a huge amount of information. I had rentals for 20 years and still learned tons when I read it.