Baseball Player/Aspiring Real Estate Investor

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Baseball Player/Aspiring Real Estate Investor

Lane A.
Red Oak, OK · Member since 2016 · 3 posts · 1 vote

Hey everybody first I would to say thank you for taking the time to help me out. Please don't hesitate to voice your thoughts and opinions they will be greatly appreciated.

I'm 26 years old and a friend of mine reached out to me and asked me if I'd be interested in real estate. I will admit I don't know the first thing about real estate much less banks, taxes and everything that comes with it. He gave me the book "The Millionaire Real Estate Investor" and after the first chapter I was hooked. I can't seem to stop researching everything real estate. It's 100% something I know I want to invest in. What's really caught my attention is rental properties and hopefully build from there, although I'm keeping all doors open at the moment. I have a great job and a solid chunk of change saved away to get started on.

Sooooo.... What's makes this a little more difficult for my situation is that I play professional baseball and I'm gone from the months of February-September/October. And being that I've never been a landlord I don't think it would be a great idea for me to jump right into landlording while I'm gone for that much time. I know I could hire a property manager but then again I don't know how all that works either.

One of the biggest questions I would like to ask is how should I go about buying my first property? Pay fully in cash or make a down payment and take out a loan?

I know I can't play baseball forever and I'd like to get some assets, equity and cash flow started while I'm playing. I've watched too many athletes go broke by not investing and not managing their money properly and I don't want that to happen to me. So please feel free to respond with your ideas, tips and all that good stuff. All of them are greatly appreciated.

Thank you for your time and your willingness to help a rookie out

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Justin R.
Developer · San Diego, CA · Member since 2015 · 1k+ posts · 1k+ votes
10y

@Lane A. A little counter to what others are advising, but I'm not sure I'd jump into REI in shoes like yours. If you've got something important going on that requires attention to succeed at (like being successful for the limited time you'll be able to play pro ball), there's a very real risk that you'll distract yourself with REI. If you're saving your money and investing it already, the capital will be there later to invest in RE once you've got the time to focus on it.

I say this because I have a 9-5 job I love and have no desire to quit ... and I'm becoming aware that real estate can adversely impact that.  It's a very predictable case of spreading too thin and there's the potential of not being great at either.

Just something to keep in mind as you weigh your options.  Protect the financial golden goose.

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  • Frank Eimiller
    Rental Property Investor · Fond Du Lac, WI · Member since 2015 · 261 posts · 78 votes
    10y

    Man. Being a professional ball player one can only assume you have a good (higher than average) amount of money to push into real estate.. sometimes that can be a bad thing for a lot of people 

    I think it would be best to find someone you trust currently investing in real estate and partnering up on a few deals 

    Nevertheless, good luck and welcome to BiggerPockets

    0Reply
  • Samuel R. Harden
    Attorney · Toledo, OH · Member since 2015 · 84 posts · 58 votes
    10y

    Another thing to consider, if it hasn't already been said (TL;DR), is: How do you want to use/hide your celebrity? Being publicly involved in your venture may bring you more/better deals than us normal folk would have access to, as everyone wants to have a story, and "that time I bought a house/did an investment deal with X" fits that category. I think that's pretty clear even from the number of responses to the type of post that would normally get maybe four or five on here.

    It could also be really annoying, and as a public figure you may get people attacking you on social media for any perceived slight. The last thing you need is Bleacher Report picking up a tweet about you being a slumlord, whether they're full of bs or not.

    My suggestion here would be to have an attorney set you up so your personal name will not be attached to any regular real estate investing you are involved with (set up should cost $thousands, but not $tens of thousands), and then maybe another set up for high end REI where your celebrity would be most beneficial.

    0Reply
  • Cal C.
    Investor · Peachtree Corners, GA · Member since 2014 · 1k+ posts · 1k+ votes
    10y

    Sorry to hear about your DFA.  Hopefully, you can prove yourself in Tampa and get back on the 40 man roster.  Strange machinations with Torreyes not sure he will last this time either.  

    0Reply
  • Stefanie Willie-Bonglo
    Real Estate Broker · Atkinson, NH · Member since 2015 · 92 posts · 24 votes
    10y

    Welcome to BP!

    0Reply
  • Ali Boone
    Real Estate Coach · Venice Beach, CA · Member since 2012 · 6k+ posts · 3k+ votes
    10y

    Hey Lane! I think it's a great idea to invest while you are playing, and that way you'll have opened yourself to a lot of freedom by the time you are done with baseball and you won't be pressed to find work or not take a break, etc.

    I definitely don't think landlording would be all that wise because what happens if you are playing a series and can't get to the property in case of emergency or if you have to coordinate repairs and such? However, you can still fairly easily own rental properties....just hire a property manager.

    I live in LA and because all of the numbers are better out-of-state, I don't buy locally here, which means I'm not local to any of my properties in case anything goes wrong. But I've always used property managers and it's worked great. Granted I've had to hire and fire a couple, but it's still a better option to me.....being that a) I'm not local and in good position to handle any issues and b) because I have no desire to handle any issues :)

    I think you have some great thoughts and there are definitely options for getting around your schedule and location!

    0Reply
  • Bonnie Rakes
    Investor · Ponca City, OK · Member since 2016 · 46 posts · 15 votes
    10y

    thoughts... i have been so screwed by Christian (pretend) friends. Leave nothing to TRUST... get a good re attorney to do all your partnership agreements so you avoid problems. 

    Take some time to learn the pros and cons of different elements of investing.... for instance, you could fund bridge loans, where joe wants to buy property b, but still owns a, so he needs a bridge loan to fund the transaction. high interest... loan secured by property a, and or anything else he owns.... lots of legal, but money out, money in. I would guess 6 month loan terms. Good financial advisor, minimal hands on needed. Zero TAX SHELTER....  You could do short term loans as well... i would look at commercial, which often has balloons due in 5 to 10 years (whatever everyone agrees to). You can structure them to adapt to your life, do multiples and have the balloons coming due at different years (like they used to recommend on certificates of deposit) so you can decide if your want to extend it, or turn it into a higher return...  tailored to your life.  

    Buy multifamily in nice areas, less maintenance costs overall with a higher class of tenant (for the most part), less turnaround.... get a good property manager... you should learn the basic ins and outs of management/maintenance to lessen the chance of getting ripped off... get references for management companies. NO CASH TRANSACTIONS EVER. You need to see ALL RENTS COMING IN... ALL INVOICES for CONTRACTORS...  Operating costs are tax deductible as is interest (at this point). You claim depreciation which lessens your tax burden for now, ( you pay uncle sam later.)

    Buy vacation condos... I don't think you could buy on in branson and not make money. many areas already have built in rental management and housekeeping etc. 

    You could fund new construction with a reputable builder.... split profits on the back end .... or maintain ownership of some of it....

    I would leverage part of my money to buy multiples, not putting all my funds into one huge deal. By borrowing to purchase, you can control many more properties, as opposed to buying one. This spreads the risk. Again, you can sell as you see fit, not all or nothing. If you do borrow, make sure you are getting the BEST TERMS... If you have a large to show as collateral lenders will be slobbering to get your accounts.

    100 ways to skin a baseball (just kidding), 100 ways to make money in real estate. You can choose one, or more... depending on your goals, life plans, etc.  GOOD LUCK.. better yet, GOOD LEARNING... luck comes and goes, education stays forever.

    0Reply
  • Cal C.
    Investor · Peachtree Corners, GA · Member since 2014 · 1k+ posts · 1k+ votes
    10y
    Originally posted by @Michaela G.:

    Another thing I'd suggest is to maybe change your profile and only use your first initial of your last name. These posts come up on google, so if a baseball fan googles your name, they'd come across your posts on BiggerPockets. I don't think that would be something you'd want. 

     Actually for his particular case that won't do much good since there hasn't been another player with Lane as his first name in 50 years in the major leagues.  Having had a cup of coffee this Lane will stand out. L. Adams might be a better idea.  

    0Reply
  • Account Closed
    Rental Property Investor · Charlotte, NC · Member since 2016 · 10 posts · 1 vote
    10y
    Originally posted by @Bill Gulley:
    Originally posted by @Lane A.:

    Hey everybody first I would to say thank you for taking the time to help me out. Please don't hesitate to voice your thoughts and opinions they will be greatly appreciated.

    I know I can't play baseball forever and I'd like to get some assets, equity and cash flow started while I'm playing. I've watched too many athletes go broke by not investing and not managing their money properly and I don't want that to happen to me. So please feel free to respond with your ideas, tips and all that good stuff. All of them are greatly appreciated.

    Thank you for your time and your willingness to help a rookie out

     Well, since you were with the Royals, I'll extend a warm hand of service and welcome, :)

    For those who don't know Lane, he's a hero on and off the field. He's also pretty hot on the hardwoods. I have family connected to Bears basketball and Hammon's Field. 

    Lane, I'd suggest you simply learn the basics of real estate first, you can't play any game well if you don't know the rules. You also can't play well if you don't understand the basic techniques and theory behind your skill. So, I'll invite you to my site in my signature line, it's free, and it's guru free as well.

    If you think the business side of baseball is tough, (it is) then try real estate and finance.

    I agree with others, your time is more valuable on the field and at home plate than in homes. 

    Long ago I was a nationally ranked amateur athlete and I know you eat and sleep your sport, like an addiction and personal distractions hinder performance.  

    I disagree that you need to "build a team" that takes time and knowledge to vet those you'd be doing business with. You need a manager, let the manager vet the partners, deals and the business end of your real estate ventures. I'll bet you already have a "team", your attorney, CPA and stock broker, most likely.  

    You do need to understand the basics of the industry from an investment standpoint, you will be directing your manager and making the final decisions. But, you don't really need to go crawl under a foundation or try to process rental applications.  

    After baseball, you can have a real estate portfolio to step into. If you want to go hammer nails you could, but you can do a lot more to be more profitable and effect how a or your community addresses housing needs. In other words, think bigger!

    One of the assets you have is recognition, that plays very in politics, not saying run for office, but real estate developments and investing is political, you have an upper hand. You might look up Section 42 Housing Tax Credits as an example.

    I can also tell you that reading guru books is not the path to take! Pulling some of things investors and operators talk about on the internet can ruin your good name! Higher profile citizens take on greater responsibilities, it's a cost of being recognized by your community, with fame comes obligations.

    When you were here in Springfield you made a choice concerning your education, I think you made the right choice. You could have gotten an MBA, but that wouldn't have put you in the position you're in today socially or financially. That's not to say that education isn't needed to manage and preserve your assets or to increase your earning potential.

    So, my suggestion is to enter the real estate arena at a more sophisticated level than most do without money, an education or experience. 

    If I can assist, don't hesitate to ask. All the best, yes, even with the Yankees :)  

     Congratulations!  I wish you all the Best!

    0Reply
  • Heather Easterbrook
    Lender · Draper, UT · Member since 2015 · 74 posts · 25 votes
    10y

    Lane,

    Definitely don't use your full name or let people know what you do. There are always going to be people trying to take advantage of others. 

    The fact that you're thinking ahead to the future is a great sign. Don't jump in head first. Take your time and learn everything you can. I like the idea about partnering with someone that has experience, but would avoid working with friends and family. Keep business separate.

    Listen to your instincts. If something sounds too go to be true...... we all know how that turns out.

    Good Luck!

    0Reply
  • Chris Romany
    Orlando, FL · Member since 2014 · 93 posts · 35 votes
    10y

    Lane,

    Saw you have had lots of good advice, so I will keep it brief. You could not have chosen a better online resource to further your real estate education and networking. I would highly recommend the podcasts, as I found those particularly helpful.

    To your success!

    0Reply
  • John Arendsen
    Homeowner · VISTA, CA · Member since 2015 · 727 posts · 340 votes
    10y

    @Lane A.Another thing you may want to consider depending on the various funding requirements that you will run across. Try to look for investments where accredited investors only are invited to participate should you want to delve into bigger investments. This will tell you that the folks you are partnering with have a net worth of at least 1 million dollars.

    If there are investments that don't require accredited investors make sure you check them out thoroughly. A good credit check from the other investors involved will tell you what their made of. Do they own a home, and how much do they owe on it? How about other properties? Types of properties? Are they on time with all their payments? Are they profitable ventures? What other types of investments, annual income, etc do they have. What are their credit score? Are they over leveraged? Do they pay on time? 

    Be sure to verify all funds coming into the investments. No IOU's No carrying someones notes. No exchanges unless they're checked out and thoroughly approved by the other investors. No KIND in lieu of CASH. That's baggage and often times garbage. An accredited investor is usually much more sophisticated, solid and well healed and have the staying power, patience, understanding and wisdom to see a deal through.

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