Starting out with Real estate, a few questions i could not find.

Emiel Sleegers · 2016-01-29T02:53:43-08:00

Hello everyone.Since this is my first post on biggerpockets i would like to introduce myself.My name is Emiel Sleegers.I am currently 20 years old and originally from the Netherlands.When i was 19 years old i managed to drop out of school and move to the united kingdom to work full time for a multi million company (my biggest achievement so far)I started to actively look into real estate for about a month ago and i'm still in the progress of reading books,watching videos and podcasts etc.So i had a few quick questions that i did not yet found in the books etc.1. Is there a big risk in investing with 0 money down? (with lending etc)2. what happens if you lend money from a hard money lender and something happens that caused you to not be able to pay him back in time?3. How do you actualy know if a property is under market value? can you calculate it or is it something you get an eye for after a while?also i would like to know what you guys think is the best way to start investing in real estate as a beginner? i do not have the time to become a landlord so my idea was to not buy to rent but more to do wholesale or fix&flip.Are there maybe any real estate investors that read this that are from the netherlands or the uk that i can maybe add to skype orso? since most topics on books and video's of real estate are focused on the us and i'm not sure what systems are the same in europe as in the us.Hope to hear from you guys soon and i am excited to start getting involved in real estate and this community.

Larry Turowski

Flipper/Rehabber · Rochester, NY · Member since 2014 · 1k+ posts · 1k+ votes

10y

@Emiel Sleegers Congrats on your early successes!

1. Some would say there is a risk WITH money down. The risk would come you not having any cash reserves and buying a property that has little or no cash flow, you can't handle expenses nor handle the debt, and you can't sell the property quickly and come away clean. If you cover these things by having cash reserves and/or having a property that cash flows really well and/or having so much equity in the property that you could quickly sell it if need be and come away whole or with money in your pocket, then you risks are much smaller.

2. Your lender will likely foreclose or you just hand over the property. Your reputation and possibly your credit take a big hit. It'll be difficult to borrow again.

3. You have to know what property is worth. Period. You are only going to get something below value if you have a motivated seller.

Hope this helps.

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Emiel Sleegers

OP

Leamington spa, Warwickshire · Member since 2016 · 6 posts · 0 votes

10y

@Larry Turowski

Thanks for your awnser larry. it defently helps!

i was wondering, what would you consider to be a good cash reserve amount?

-Emiel

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Hattie Dizmond

Investor · Dallas, TX · Member since 2014 · 2k+ posts · 1k+ votes

10y

Welcome to the fun!

Read the Ultimate Beginners Guide. It will give you all the details on the various strategies, how to analyze properties, etc. https://www.biggerpockets.com/real-estate-investin...

Read Brandon Turner's How to Invest in Real Estate With No and Low Money Down. http://get.biggerpockets.com/nomoneydown/

Listen to the podcasts. https://www.biggerpockets.com/podcast

Read the BP Blogs. https://www.biggerpockets.com/renewsblog

There is a separate guide dedicated to analyzing deals... https://www.biggerpockets.com/renewsblog/2010/06/3...

If you're not going to be a landlord, you have a couple of primary strategies...Flipping & Wholesaling. (I'm not really sure how or if either of those play well in the UK.) But, if you're planning to flip, you must read the 2 J Scott books...The Book on Flipping Houses and The Book on Estimating Rehab Costs. http://get.biggerpockets.com/flippingbook/

Education is key. But, so is massive action. Don't get into analysis paralysis. You will NEVER know everything. Even Jay Hindrichs and Ben Leybovich don't know everything. (Neither does Brandon Turner, but Brandon admits it! Just kidding guys!)

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Larry Turowski

Flipper/Rehabber · Rochester, NY · Member since 2014 · 1k+ posts · 1k+ votes

10y

Originally posted by @Emiel Sleegers:

@Larry Turowski

Thanks for your awnser larry. it defently helps!

i was wondering, what would you consider to be a good cash reserve amount?

-Emiel

Don't you hate hearing "It depends?" But that is the truth. By cash reserves, I don't mean just repairs and capital expenditures (big repairs). I mean being able to handle a long vacancy, a tenant destroyting a place, etc. All in all, I would say enough to carry the property vacant for 6 months. More if it is in rougher shape, less if it is in great shape.

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Emiel Sleegers

OP

Leamington spa, Warwickshire · Member since 2016 · 6 posts · 0 votes

10y

@Larry Turowski

Yes the thing is i'm still young so i have a small 4-5000 euro as a "reserve" but that's also my savings.

I'm not sure yet but i think that i'm going to do wholesale and fix&flip

those look like the best option for me.

@Hattie Dizmond thanks for the info! there is so much info out there, i'm reading a real estate for dummies right now. but i will definitely have a look at the rest.

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Starting out with Real estate, a few questions i could not find.

Starting out with Real estate, a few questions i could not find.

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