Help me flip!

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Help me flip!

Account Closed
Brooklyn, NY · Member since 2015 · 40 posts · 4 votes

Hello Bigger Pockets Community,

My name is Anthony and I currently live in Brooklyn, NY. I have always been interested in real estate. Even to the point where I received my salesperson license but haven't really perused the sales aspect of it. I am more passionate on investing in any way possible (flip, hold properties, commercial, sublet rentals etc. ). I have been reading the forums to try to get some advice. But I am hitting a wall.

The fact that I am 21 with only 10k saved doesn't really open to many doors for me. In particular, the NYC Metro area is expensive and most people want 20% down for a purchase. I am looking for some type of guidance of where I can start with my current situation. I'm not looking to wait a couple of years and save more because TIME is MONEY! 

Any advice would be greatly appreciated! Thank you in advance!

-Anthony

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Carlton Kohler
Wholesaler · Buford, GA · Member since 2014 · 119 posts · 15 votes
11y

You guys are in the right place for information, but you're asking the wrong questions. There's tons of different ways to get started in real estate without having any money. I suggest you start here http://www.biggerpockets.com/real-estate-investing

This should start getting things going, then spend more time browsing and reading. 

Welcome to BP

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  • Deondra Carter
    New York, NY · Member since 2014 · 83 posts · 25 votes
    11y

    @Anthony Talpak I totally understand your situation. I'm in the same boat. I live in Manhattan and am now looking in The Bronx, Queens, Long Island (only properties with cheaper taxes) and NJ. These areas have lower prices and you can do an FHA loan for 3.5% down, live-in it for at least one year and keep climbing. Good luck!

    0Reply
  • Mark Cohen
    Real Estate Professional · Monsey, NY · Member since 2014 · 51 posts · 9 votes
    11y

    I am a little farther out than you (rockland county) but why not put your agents license to work by signing with a broker and getting mls access which can greatly aid you in researching areas a little further out which may be more affordable, like dutchess county.  Also don't forget about seller financing.....

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  • Rhonda E.
    Staten Island, NY · Member since 2015 · 12 posts · 2 votes
    11y

    @Anthony. Well clearly you're not alone because I'm in the same situation (Staten Island resident).  I also got a NY RE license years ago but let it lapse because I realized that renting/selling apartments in New York couldn't be a part-time job (at least not for me.) There has been some sound advice offered here. I'm going to join a few meetups in NY/NJ area and focus on either wholesale or purchasing properties out of state.  

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  • Account Closed
    OP
    Brooklyn, NY · Member since 2015 · 40 posts · 4 votes
    11y

    @Rhonda E. @Deondra Carter It nice to see people who know the deal! Im looking to go to some meetups but I still believe I'm going to need more capital to make any deals. Unless you guys know some secret ways?! 

    I appreciate the advice, hopefully in the near to very close future I can jump back into real estate and find a good broker to work with. Hopefully it will shed some light on my situation!

    Thanks!

    0Reply
  • Bob Couture
    West Springfield, MA · Member since 2013 · 188 posts · 52 votes
    11y

    @Brandon Turner wrote a book on your exact issue. The title is to long to write, but you'll hear him mention it every podcast. 

    0Reply
  • Rhonda E.
    Staten Island, NY · Member since 2015 · 12 posts · 2 votes
    11y

    I think partnerships with trusted investors is a viable option too, or at least that's what I read in the Bigger Pockets Intro to Real Estate Investing. :)

    http://www.biggerpockets.com/real-estate-investing/financing

    0Reply
  • Account Closed
    OP
    Brooklyn, NY · Member since 2015 · 40 posts · 4 votes
    11y
    Bob Couture I'm going to download the book tonight and get started thanks ! Rhonda Eason I would love to work with a partner and do something together but I never know what kind of structure to negotiate. The key work you said was "trusted"!
    0Reply
  • Rhonda E.
    Staten Island, NY · Member since 2015 · 12 posts · 2 votes
    11y

    There's a webinar starting right now.  You should join.  

    The 7 Steps Needed to Get Lenders to Fund Your Real Estate Deals

    0Reply
  • Adam K.
    Investor · Brooklyn, NY · Member since 2015 · 127 posts · 57 votes
    11y

    @Account Closed

    I posted a couple months back about deals in Brooklyn:
    http://www.biggerpockets.com/forums/311/topics/186...

    Obviously, it's out of date, but the principles apply. There are multi-units available off the MLS where the numbers may work if you house-hack the owner-occupied unit. You're not going to get cash flow with an FHA loan, but you can potentially live close to rent-free and position yourself well for potential appreciation (which, given the high leverage, could be a massive return if you pick the right area). You'd have to be willing to move well east in Brooklyn, or to the Bronx or Queens, but the opportunities are there. Just keep checking listings. Good luck!

    0Reply
  • John C S.
    Flipper · Poconos, PA · Member since 2015 · 198 posts · 42 votes
    11y

    Hey guys I'm hearing every word your saying. We are all on the same ship so why not be shipmates. I'm looking for meet ups where I can get together with other investors around the New York area. And learn from them and make friends. So let's stay in touch with each other and inform each other on anything we hear about.  We're all new at this and from the same area so we can help each other out.

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  • Barbara G.
    Hartsdale, NY · Member since 2015 · 874 posts · 218 votes
    11y

    John Salerno from Franklyn Square said he would like  to get together at a meet up and that is such a great idea.  One suggeston  was a partnerhip as a first buy.    Keep that in mind.  If you don't have the money to go it alone OR if you need the moral support of a partner for a first  journey into the world of Real Estate a  partnership is a good thought.      2 of you can buy your first property together.   Maybe you find something  out in the Bronx.  You don't know the Bronx, or Dutchess County, or New Jersey  but you can be there together.     Let us know here on Bigger Pockets if any of you get to a real Estate Club or a Meet Up and update this thread.  John let us know what Clubs you are considering,

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  • Account Closed
    OP
    Brooklyn, NY · Member since 2015 · 40 posts · 4 votes
    11y
    John Salerno Barbara Goodman Having a partner sounds like a great idea! Anything that can help me gain some experience and push me to begin my journey would help. I'm not looking to move so if anyone can help me get to a 20% down payment, it would mean the world to me! Gaining a huge profit isn't such a big deal right now, I just want to get the ball rolling! Thanks again to everyone who has posted in this thread, you guys have helped me so much and motivated me more then I've ever been!
    0Reply
  • Joe Fairless
    Investor · Cincinnati, OH · Member since 2013 · 2k+ posts · 1k+ votes
    11y

    @Account Closed you could do seller financing, you could save up more money or you could move out a little bit where that 10k will let you live in one side and rent out the other. Binghamton is growing and you can get good deals there. 

    0Reply
  • Account Closed
    OP
    Brooklyn, NY · Member since 2015 · 40 posts · 4 votes
    11y
    Joe Fairless I feel like seller financing is taboo and is a big no no. Aren't the odds slim to none to have a seller agree to that? How would I gain leverage to convince the seller to agree?
    0Reply
  • Joe Fairless
    Investor · Cincinnati, OH · Member since 2013 · 2k+ posts · 1k+ votes
    11y

    @Account Closed: http://www.biggerpockets.com/renewsblog/2013/11/05/seller-financing/

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  • Barbara G.
    Hartsdale, NY · Member since 2015 · 874 posts · 218 votes
    11y

    Seller financing?  Well I guess first you have to ask.  A seller that would carry paper  doesn't need the money immediatly and might be interested.  You would present your proposal, and in your case I assume you would tell them you would put $10,000 in cash down and for the balance you would sign a mortgage (your lawyer would help you with that) at a particular percentage.  I assume the interest would be a little more then the bank would charge and the seller would either accept your proposal or recject your offer.   

     My second residence was purchased with seller financing.  The woman I bought the house from wanted an income at a particular interest rate, (which was more then she could get keeping the money  in the bank ) and she carried my mortgage.    

    What did Brandon's article say?  

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  • Ian Daly
    Mamaroneck, NY · Member since 2011 · 1 post · 0 votes
    11y

    Hey Anthony & Ti,

    I commend you guys for attempting to get into the business at such a young age. I too live in New York and have had a few homes here, starting in 1991 in Long Island and 1998 in Mill Basin then on to Bed Stuy/Clinton Hill, the last two being multi family residences. This market is difficult considering the astronomical price of properties. Distance investing has it's disadvantages but can also work. I managed an investment in The Netherlands for several years and currently manage two properties in the Richmond, VA area, one of which I am about to sell and that's why I came to the site. What I would suggest you do is create your own network. First, you should find a contractor that you trust. There are contractors that do very good work that you can partner with. Next, try to get outside of the 5 boroughs for your first deal, in other words find an area with cheaper houses. Flipping in an area with million dollar properties and $10k I'm sure can happen, but I don't think it's the most practical.

    0Reply
  • Jesse T.
    Herndon, VA · Member since 2014 · 1k+ posts · 324 votes
    11y

    While house-hacking is traditional done with a multi-unit property - it can also be done with roommates in a single unit.  In some areas rooms can be rented at a premium to the entire unit, so that may help bridge the gap.  If you have a trusted friend who would be a potential partner/roommate in buying that can help a lot with affordability - especially if you can split the mortgage and use the additional bedrooms to build up capital.  If you buy a property together be sure everything(including a buy-out) is specified.

    Long-term it may be easier to build a portfolio in a cheaper area.  Is a transfer/promotion to another area a possibility?

    0Reply
  • Account Closed
    OP
    Brooklyn, NY · Member since 2015 · 40 posts · 4 votes
    11y

    @Jesse T. Being that I have my own store, a transfer/promotion isn't really an option at this point. Unless a new career path is in the stars (I am 21, some people say that's young, I don't believe it however). I'm just looking at decent properties within an hour or so from my current location. I might have to buy into a war zone but that's the sacrifice that I have to make if I want to start this NOW. 

    0Reply
  • Jesse T.
    Herndon, VA · Member since 2014 · 1k+ posts · 324 votes
    11y

    Have you thought about doing sales in commercial real estate?  As a business owner you may have a good perspective in helping other business find good real estate to rent/purchase?  The competition as a commercial agent is likely tougher than residential, but if you are willing to start out small - you may be able to get clients that aren't as appealing to more established agents.

    0Reply
  • Mindy JensenPro Member
    BiggerPockets Money Podcast Host · Longmont, CO · Member since 2014 · 7k+ posts · 10k+ votes
    11y

    @Account Closed wrote a book called The Book on Investing in Real Estate with No (and Low) Money Down. 

    House hacking may be a viable option for you as well. I am completely unfamiliar with Brooklyn, so I don't know what sort of multi-family properties are available there. Any property with 4 or fewer units will qualify for an FHA loan, which can be secured for as little as 3.5% down. Do you have any family that can help you out? The IRS allows a tax-free gift of up to $14,000 per year.

    You said you have your license, do you have access to the MLS? Do you have auto-alerts for when properties come on the market?

    Living in one unit while renting the others out might allow you to pay the entire mortgage with rent, allowing you to save more money for your next property. Good luck!

    [email protected]Podcast Guest on Show #261
    BiggerPockets
    1Reply
  • John C S.
    Flipper · Poconos, PA · Member since 2015 · 198 posts · 42 votes
    11y

    Barbara Goodman I don't know what clubs I am considering because I don't know of any I'm trying to find some.  Later on today I am going to upgrade to a plus membership so I can go off my zip code. I really want to start going to event's like that and network. I feel it's the best way to get my feet wet and learn. Also start sizing up people to build a teen in the future.

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  • Chuck Catchings
    Lake City, CO · Member since 2012 · 118 posts · 15 votes
    11y

    Anthony, I have read through all the replies and none have mentioned working with a full turn key wholesaler. Now I am talking out of your area and most likely out of state where prices are much, much cheaper. Oh and that trust word is optimal because your going to get a lot of pros and cons to investing out of your area or state here on BP. 

    It's hard for people that live in high end areas to believe there are still properties that can be bought for that $10K that you have saved. I have a friend that's a wholesaler and he's been doing exactly this for the last couple of years in the St. Louis, Mo. area.

    So if your interested I can help, I do have over 30 years background in all phases of SFR and multifamily construction. Good luck.

    Chuck

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  • Barbara G.
    Hartsdale, NY · Member since 2015 · 874 posts · 218 votes
    11y

    John Just Google Real Estate clubs in Manhattan or Brooklyn or Bronx where ever and they will come up and also Google Meet Up Real Estate Groups.  Ask them if you can go to the first one free so you can see if you like it

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  • Aldo Ricaurte
    Tampa Bay, FL · Member since 2015 · 15 posts · 1 vote
    11y

    I agree with Chuck, wholesaling seems to work better for you if you don't have a lot of money for a hard loan or conventional financing. Find a good deal and the money will come once you offer it to an investor.

    I wish you luck.

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