San Francisco, CA · Member since 2017 · 23 posts · 14 votes
Hey everyone! I'm just now getting into the market and am looking for advice on how to get started. I have the capital to invest, but I just need a solid mentor and path. Any suggestions are welcome!
Investor · Minneapolis, MN · Member since 2017 · 103 posts · 53 votes
7y
The area I invest in are college rentals that I manage. If that sounds interest feel free to fire off some questions. I would say the best advice I have is just do it. I really think its that simple, so if you've been looking and have an idea as to what you want starting looking at properties when one hits your numbers just go for it.
San Francisco, CA · Member since 2017 · 23 posts · 14 votes
7y
@Mark Trebor Thanks for being willing to help! Besides finding a good real-estate agent, who would you recommend I add to my team to help me be successful?
@Mark Trebor Thanks for being willing to help! Besides finding a good real-estate agent, who would you recommend I add to my team to help me be successful.
Once you get going you will need a reliable Plumber/HVAC person. I self mange the properties and rely on a whole bunch of different maintenance people but the Plumber/HVAC guy is the guy you need. Most plumbing/HVAC issues cannot wait until the weekend or when it fits in your schedule. I still use the first guy my realtor suggested from 12 years ago, but now that I have 18 properties we have three different Plumbers/HVAC companies that we can call on.
As for the operations side of things a Realtor has been nice to have in the back pocket but of the 18 houses we have bought I think I found 14 of them on our own. Of the last 3 we bought 2 of them we found from approaching the owners directly, we saved ourselves allot of money by going directly to the title company and cutting out the realtor. Yes in theory the seller pays the realtor but in reality if you're buying the house you're paying the realtor. We worked with a small regional bank on the consumer side getting conventional mortgage for the first 9 houses after that we moved over to the commercial side due to lending laws. Working with them for the conventional mortgages initially gave us a foot in the door to get larger sums of money with the last 9 houses. So having a banking relationship is good, we use two different insurance agents and they know that we split the business between the two different companies. That has worked in our favor and kept the annual increases low, because they know we will jump ship if they get greedy.
I also run Quickbooks by myself and have used 3 different accountants over the years. Started with a big firm, then moved to an independent now with a father and son team. The independent was the cheapest but the father and son team seems to be on top of their game a little better and they have a small support staff.
To summarize Maintenance
1) Plumber/HVAC
2) General Handy Man
3) Painter/Drywall Guy
4) Roofer
5) Electrician
6) Garage Door Guy
Operations
1) Banker
2) Accountant
3) Title Company
4) Realtor - until you buy a couple of houses using one they are really not going to give you any special treatment even though they tell you they will. You have to prove you are legit to them (which I think is fair). We still stay in touch with the realtor we used for a number of deals and her team reaches out occasionally with opportunities. She knows what and where we want properties. She takes a video of the house and we make an offer based on the walk through.
San Francisco, CA · Member since 2017 · 23 posts · 14 votes
7y
@Mark Trebor Thank you so much for all this detailed advice! I'm currently considering using a management company to deal with the maintenance things because I currently work a full time job and would prefer to approach this more as an investor (at least for now). Do you think it is important for me to find all of these maintenance people myself, or should I focus on finding a good property manager that has these people already lined up?
San Francisco, CA · Member since 2017 · 23 posts · 14 votes
7y
@Jay Helms My why is currently two fold. First, I enjoy a good challenge that requires me to figure things out, and I am in need of a new challenge. Ultimately though, my end goal is to acquire enough properties so that my passive income is enough to enjoy a modest life and quit my job.
@Mark Trebor Thank you so much for all this detailed advice! I'm currently considering using a management company to deal with the maintenance things because I currently work a full time job and would prefer to approach this more as an investor (at least for now). Do you think it is important for me to find all of these maintenance people myself, or should I focus on finding a good property manager that has these people already lined up?
If you're using a property manager he should have all of these guys lined up or if he's big enough he will have licensed guys on staff. Be careful with the property managers, in my city they charge 12-15% of revenue, $500 annually for finding tenants and then there are additional charges for each maintenance call. I know a number of landlords that rent college houses and pay property managers. They start with a house that generates 25K in revenue and their property manager is grabbing between 8-10K a year on each property. That's why I self manage.
Flipper/Rehabber · Los Angeles, CA · Member since 2015 · 128 posts · 37 votes
7y
@Michael Hudelson There are a lot of different ways you can get started in the business, all of which require a different level of your involvement. It sounds like what you're looking do is more on the passive side so a couple of the things I would suggest reading up a bit more are:
1. Rental with a good property manager (Some time and challenging yourself)
2. Investing your money with an experienced investor (Very little time very little challenge)
3. Buying Tax Liens (More time and challenge)
Those are really only a few basic strategies, but dig into those a little bit and see where it takes you, feel free to give me a shout if you have any questions!
San Francisco, CA · Member since 2017 · 23 posts · 14 votes
7y
@Jay Helms I want to quit my job so I can purse my personal interests more. Travel, play music, spend time with friends and family, and start other side businesses.
@Account Closed I will look into these topics more. Thank you :D
Rental Property Investor · San Ramon, CA · Member since 2017 · 350 posts · 611 votes
7y
I would recommend finding a deal first. In this market, excellent deals are hard to come by. The best way to identify a deal is to underwrite thoroughly them as if you were going to buy them. Walk properties and practice what questions to ask, what problems to look for, etc. After you write about 100 deals or so, you will get the hang of it and be able to jump on a property that looks good. A mentor is not required. I didn't have a mentor and learned everything myself with good partners.
San Francisco, CA · Member since 2017 · 23 posts · 14 votes
7y
@Jay Helms They are coming along nicely! I have been in the habit of journaling daily for awhile now, and I have been using this year to journal primarily around my real estate goals. I plan to consolidate my ideas into a single document once some dust settles at work.
I'll try to post again by this time next week :)
Thank you for checking in and keeping me on top of things!