Questions to ask when buying your first real estate investment?

Question

In about 7 months my lease will be up on my apartment and I do not intend on renewing it because it is my largest monthly expense. I found BiggerPockets in June of 2017 and have been addicted to their concepts/ideas about real estate investing ever since. With that said, the past several months I have been listening to BiggerPockets podcast, reading books and trying to analyze properties in my area because I will need to do something in the next 7 months to eliminate my monthly rent payment. Please share your thoughts on things I should look out for when buying my first real estate investment. What questions should I ask the banks, the real estate agent, the seller? What things should I look out for when touring the house that are often hidden from the eye, but will be costly to fix? Please share your stories, thoughts, and experiences.

I appreciate the feedback!

George Skidis · Answer

Pick a neighborhood you would like to farm. No more than 25 miles from your residence. Go walk it and see how it feels. Attend yard sales and see the reason. Cleaning the clutter or getting ready to move. Have your materials with you. If you see something you want at the yard sale haggle over it politely. Get a feel for the people and the neighborhood. If it doesn't feel right choose another subdivision. Interview a dozen or more realtors until you find one that is investor friendly.

Burn through their MLS listings and pick the top ten to look at. Go look at them by yourself and save the real estate agent wasted effort. If you cannot be ready to pull the trigger on something, don't waste their time and gas. Respecting their time and resources will get you onto their preferred status list. When you are preferred you will sometimes get called "BEFORE" the MLS listing is posted.

Your focus should be on a 2 to 4 family unit that you would like to live in. As an owner occupant you can manage the tenants and toilets in the wee hours of the morning, or hire a property management company to deal with them while you learn the business slowly.

When you decide on Business cards should not have your photo or anything on them that says you are the owner. Use Senior Leasing Specialist, Resident Placement and Eviction Officer or some other nondescript name. Owners are targets. Be vague, be discreet and above all buy lots of liability insurance.

Avoid the big real estate shows that come into town. They will take your money and you won't have any left invest. Instead, join the local real estate investors association "REIA" in your area. Anything associated with the National Real Estate Investors Association is probably a safe bet.

Good Luck and Good Investing!

Patrice Boenzi · Answer

@Nick Barber first of all congrats on your desire to start the real estate investing journey. I am a realtor in Illinois and an investor; I was an investor first. I flip properties and take my profits and buy rentals in Michigan. Our son lives in Michigan and is an agent and investor too. He bought his first duplex 3-4 months after graduating college and house hacked. feel free to private message me- I love helping people get started and I love sharing my story.

Ramon Huerta · Answer

I don't believe there is just one right answer as there are many ways to go about buying an investment property. I would recommend you find yourself a good Investor friendly realtor to begin helping you. I would also recommend you find a local REI group and start networking and learning from other investors. But most importantly look for what your able to take on and benefit you in your situation right now.  Talk to a good lender and see what finance option they have for you. Work with who you have and just start taking steps towards your goal. Be patient and look at as many properties as you can. If you have any additional questions feel free to PM me. And I wish you the best in your REAL ESTATE JOURNEY!

Yuriy Skripnichenko · Answer

@Nick Barber

It all depends on the type of the property you are looking at and on your plan.  I'd assume you are looking to househack a MFH. You should find a bank that will loan you the amount of money you need with the terms you need and you you should have some saving for downpayment and closing cost. Check out your local first time buyers programs. A lot of states/counties have programs to assist with the closing costs. Google it, ask banks about it. You should ask you real estate agent everything that you want to ask, do not afraid asking questions. That is why you have an agent to guide you through the process. As far as the condition of the property you will need to make a home inspection and maybe some other type of inspections to determine the condition of the property.

Hope this helps.

Questions to ask when buying your first real estate investment?

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