I will be graduating here next month from Northwest University up near Seattle, and I am very eager to get into real estate investing. My degree is in business management and Accounting, but real estate is my passion. I have very little money saved up as I have been paying down my student loans very aggressively while in school. I want to find a way I get started as quickly as possible. It will clearly take me a while to save up some decent capital, but I'm looking for other suggestions. I don't have a job lined up yet so there is no income yet to use as far as loans go. Does anyone have any suggestions? I am looking to try wholesaling while I don't have a lot of cash, and am meeting with an investor in a few days to talk about that, any other suggestions?
Get a job, save money, study hard, take action.
Get a job, save money, study hard, take action.
Blake, my degree is also in business management and Accounting. I've taken the route of getting a stable W2 job and investing on the side. Starting this early will put you miles ahead, keep at it! Look for partners where you can put int he sweat equity. Look for a job that uses your degree and is RE related or adjacent. Hang out with other investors. BP has great local meet-ups, I try to get to the Olympia one when I can, know they have ones farther north too.
I graduated from NU several years ago. Congrats on completing your education.
My best recommendation is to get plugged in to the meetups. The Kirkland and Seattle meetups are full of amazing people that are effective in the game. On top of that, listen to the podcasts and read as much as you can.
Best of luck!
thank you Michele and Nathan! i really appreciate the encouraging words! I will for sure be checking out some of the local meetups, and i hope to meet both of you soon!
@Blake King congrats on having the right mindset. My advice would be to not "aggressively" pay down student loans. Rather save that money to invest and make a much better return than the 5-7% tax deductible interest that is charged on those loans. I've been out of school 5.5 years, own 35 units in Everett and am still paying off student loans.
Congrats on your education. I am also an accountant and know how tough those classes can be. I agree with the advice above. I have been out of school for 2 years now, own one SFR and have completed one fix n flip.
First, I would suggest using your accounting degree to find a job auditing or accounting for an investment company (real estate or not). This will help you develop an investors mindset and see the ins and outs of different strategies of raising capital, leveraging assets, etc.
Second, find ways to cut costs. Think along the lines of lengthening your student loan to the maximum payoff period and only make the minimum payment (stick with me here). If possible, move in with a family member to eliminate rent or at least minimize it. Don't go out and buy a fancy car like most college grads do.
Next, PAY YOURSELF FIRST. Set up a separate savings account and send a certain percentage of your paychecks directly to this account. This is the best way to build your capital for your first investment.
It may take some time to build a chunk of capital for your first investment so in the meantime, read as many books as possible (I suggest rich dad poor dad as your first), listen to the BP podcasts, and try to find a mentor who you can bounce ideas off of and possibly show you around your local markets. This will help you develop the base in which you will use to decide whether something is a good purchase in the future. Really listen to not only what has made investors successful, but also where and why they have lost money. It's much cheaper to learn from other people's costly mistakes than to make them on your own.
If you put in the hard work and research, your investments will by far exceed the benefit of paying off your student loans as fast as possible and I can guarantee you will be glad you got the w-2 job to subsidize your income until you can develop an investment base.
Good luck and stay eager!
Hello everyone, I have a quick update here, as well as some more questions that have come out of that. As of last week I started a new job as a portfolio accountant at an investment firm in downtown Seattle! I'm super excited about this opportunity, and it is giving me a nice starting salary to start moving towards my goals of passive income!
Now that I have a job secured, what should my first steps be? I currently am living at home with my family and bussing in an hour and a half to Seattle every day, so I have lots of time to read, what should be some books to set my mental foundation for real estate? (I have already read rich dad poor dad, and a few others)
Is there a recommended level of savings you would suggest for me to start?
I have been told about the low money down FHA loans as a first time home buyer, and using that to buy a live in duplex, is that still a good route?
Thanks everyone for your help, I'm excited for this new stage in my life!
@Blake King congrats on the new job, that is a great first step. Aside from a lot of the usual "real estate classics" I would suggest reading a book or two by Grant Cardone. He did a podcast a while back.... I think #108. One of my favorite episodes. Though I don't agree with everything he says I do really like his investment philosophy. He suggests to wait until you save $100,000 before you start investing. This does three things:
1) Proves you can make money
2) Proves you can save money
3) Gives you enough money to start to make life changing investments
His philosophy, which I agree with, is you aren't going to change your life with $5k, $20k or even $50k worth of investments but $100k is a great jumping off point. I saved nearly $100k before my first investment (a pair of side by side duplexes @ 25% down) and it definitely started some life changing investment strategies and lifestyle designs for myself and wife.
Thanks @Grant Fosheim I appreciate it! On the other side of that, is there benefit to starting early with less money down in order to get in the market earlier, especially if saving money house hacking, or buying a duplex and living in one with less money down?
@Blake King most definitely! I think there would be a ton of value in purchasing a fourplex as a primary residence with as little down as possible and living for free. Then the compound interest of starting so young would help a ton too.
Thanks @Grant Fosheim ! I think that is the route I will be going. I will still need around 5% down I am assuming? Which isn't bad. I'm looking for the Lynwood area as I work downtown Seattle so it is cheaper but still close, and I love that area! I haven't seen many multi-families in the area tho... do you have any experience in the Lynwood area?
@Blake King you would have to confirm the down payment % with a mortgage broker but I believe on an owner occupied 4plex you will still need 20% down and 15% for an FHA loan. A think you can do an FHA duplex for as little as 5% down but again, you would need to confirm all this with a mortgage broker.
I manage a Fourplex in Lynnwood for a client that cash flows nicely because he bought it back in 2005. Nowadays you'd be hard pressed to find any multiplexes in Lynnwood for under $200k a unit which makes it tough to cashflow on. However, Lynnwood is a great spot at the intersection of I5-405. Plus with over $1 BILLION worth of construction on the books over the next 4 years and light rail arriving in 2025 the city is set explode if the economy stays healthy.
Wow @Grant Fosheim those are some awesome insights, thank you! Looking in Redfin there doesn't seem to be much out there in the area, I have always loved the Lynwood area tho! Do you have any recommendations for banks, or mortgage brokers to talk to for an FHA loan? Just so I can know what I need before I can start? Thanks again for all the info, I really appreciate it!
Hey Blake! Glad to see your making the jump into real estate. I am originally from Los Angeles, CA area and saw some opportunities in the midwest to invest in some properties because of some local connections. It was an easier start for me as a solo investor because I was able to secure some property for a fraction of the price in major markets. Sub markets are worth thinking about. Just some food for thought.
Hey @Michael David Pagan good to hear from you! I'm gonna PM you to hear a bit more about what you are doing!
You might also consider looking into single family with a second unit. This would allow you finance your property at only 3.5% down on an FHA. You could then take the smaller unit for yourself and essentially rent out the larger to cover your payment. Also, keep in mind that you will be building your portfolio as a landlord and gaining the 2 years experience required in order to utilize received rents as part of your income in the future. Feel free to bounce questions off of me as I live in the Lynnwood area and am both a real estate broker as well as loan officer. Happy to help.
Hi @Jacqueline Cliff !
Thanks for reaching out! Where would you suggest I start looking for deals in Lynwood? I have just been cruising around online a bit, and have not seen many places larger than single family's!
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