How would you go about it??

Question

Hello, my name is Thomas Turner and I'm new to Real Estate Investing. I'm looking to do my first deal, trouble is, being new to the game I do not know what type of deal I should be looking for; B&H, flip, BRRRR, etc. I have backers who've given me the thumbs up to bring them deals which in turn will help jump start my own investments. If you were me, what type of deals would you be looking at for your first deal?

Anthony Dooley · Answer

Account Closed Multi-family is what people say, but the fact is that there are not that many multi-family deals out there to look at, and the ones that you see are not great deals.  I recommend doing some SFR, not because muiti-family are not better, but you can find an SFR on every corner.  You don't know what you don't know at this point and SFR will teach you process.

Look at a lot of property. Most are not good deals.  When you find a good deal, base your exit strategy on your goals and also the terms of the deal.

I challenge you to set bigger goals.  HUGE goals. If you set a 4 house per year goal, you will work hard enough to get 4 houses.  Why not set a 10 house goal?  You may fail to reach it, but maybe you will get 7 deals done.

Account Closed · Answer

@Anthony Dooley, thanks for the encouragement. Your right about the goals. As I was putting pen to paper I was thinking the number should be bigger but I errored on the conservative side. I want the goal to be realistic and attainable but I see your point. I'm aiming to low. My logic is that obtaining 2 properties per quarter is enough to get us going and on our way out of working a day job where I'm sending other peoples kids to college 😀

I'm reading John Schaub's book Building Wealth One House At A Time which supports your advice on SFR's. That route seems appealing to me and it makes sense. I want to keep my eyes open to flips and other opportunities as well. A combination of flips and income generating SFR's are what I think of as the beginnings of a diverse portfolio.

Knowing all that would you still recommend I modify my gosls? Does my plan look sound?

Account Closed · Answer

To everyone who responded. Thank you.

My goal is to leave the life draining rat race I currently live in. :^)  More specifically I want to flip 4 houses a year with an average $30k take home. The revenue will go into funding my next goal which is to acquire 4 positive cash flow using the BRRRR strategy, appreciating rental properties per year.

You mentioned off-market multi-family deals via direct mail campaign. How do you know which area to target for the direct mailing?

I'll add that for my first deal I plan to seek out a investor here in the Sacramento area and partner on a deal with them with me doing all the work and having them be my wing man. Their function will be to provide guidance, and support. Does that sound like a sound strategy? How would you approach a potential local investor with my idea. I'd compensate them 1/2 for being my wingman.

Thomas Turner

John Mathewson · Answer

I love the BRRRR strategy spending on your finance situation and what you can afford to do. It can be a really great way to build passive income but you have to be patient and don't rush into a deal. Study the numbers they don't lie.

Linda S. · Answer

It all depends on your strategy, but it seems like multifamily is normally the best option for investors.

Michael Evans · Answer

I would start small.  Find a flip property that doesn't need a lot of rehab work.  Get the experience of actually negotiating the deal, managing the rehab and selling the property under your belt.

Stay Blessed!

Abel Curiel · Answer

Good morning Thomas,

The answer to this question depends on your goals. What are you looking to accomplish 10 years from now and what can you do this year, this month, and today in order to be on track for that 10-year goal.

That being said, I like the BRRRR strategy. Also, anyone telling you to bring them deals can help you make some quick cash by wholesaling or could possibly be open to letting you in on the deal if you ask.

For a first deal, I would look for off-market multi-family deals via direct mail campaign.

Best of luck to you!

-Abel