I want to be able to generate 50k annually in Passive real estate

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I want to be able to generate 50k annually in Passive real estate

Jared Palacios
Rental Property Investor · Rancho Cordova, CA · Member since 2017 · 9 posts · 2 votes

How many times would you say you find yourself wandering through listing after listing Searching areas, criteria, rental income, number crunching? Me - Seems to be all day. I just keep stalling my own progress by being scared to jump back in. I have taken to Nevada real estate license exams more then I’d like to admit and have passed the state my never the national. I currently live in California now and want to be in real estate more then anything, but I feel I do not need to go after a RE License but more over bring value by driving for doors, and using my resourcefulness rather then resources. I want and need a mentor/ leader to get me to that next step. I can sell, I feel I can connect with anyone and find common ground and empathy towards people.  Have you ever felt that way? I am just looking to serve and know it will come full circle. My question to all BP is where do I start to look for a Mentor? Do I just research every Brokerage in my area and find out which RE Agent or Broker owns the most RE investments and beg to be his slave and provide value in any way possible for them so I might gain more knowledge and wisdom? Do I go after being a REA? What is your advice, Experience?

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Terrell Garren
Rental Property Investor · Concord, NC · Member since 2016 · 1k+ posts · 3k+ votes
7y

My path (not necessarily the right path) - I didn't do meet ups, seminars, mentors or RE investment books. I bought a SFH foreclosure for $70K in 2008. Did all the work my self - cleaning, floors, paint, fixtures, toilets, used appliances off CL, landscaping, advertise, applications, lease agreement, PM. I did do a good bit of googling & youtube learning - both trades and PM. It took me 8 months of part time labor and probably $2K in stupid mistakes, but it was the best education I could ask for. It's been rented to the same family for 11 years, no late rent, maybe 7 or eight service calls. I guess what I'm saying is - 'just do it' is the best education.

Disclaimer - I started in 2008 when it was next to impossible to screw up.

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  • Taylor L.
    Rental Property Investor · RVA · Member since 2016 · 5k+ posts · 4k+ votes
    7y

    A real estate license is unnecessary for real estate investing. Most agents are not investors, and most investors are not agents. 

    Hunting for deals is a huge part of the game. It might be time to look in another area. California is going to be particularly difficult.

    Passive income is a snowball, and by far the hardest part is getting the snowball going in the first place.

    3Reply
  • Jordan Hamilton
    Miami, FL · Member since 2018 · 66 posts · 33 votes
    7y

    @Jared Palacios I am new so others might have different opinions but I would read articles on bigger pockets, read tons of real estate books, watch Youtube videos/ bloggers that are doing deals and just take as much information in as possible. If you feel you need mentorship I am sure you could pay someone on here to coach you every step of your first deal.

    My strategy thus far is learning as much as I can about the type of real estate I want to invest in (2-4 units) and analyzing the numbers. Once you know your numbers to a T then you will have a lot more confidence and feel you might not need to "slave" to gain knowledge or wisdom from someone else. If I didn't have a full time job I would consider working/ interning for a property management company in my area to learn the ins and outs of what they do.

    Good luck!

    1Reply
  • Spencer Cornelia
    Investor · Las Vegas, NV · Member since 2017 · 321 posts · 524 votes
    7y

    @Jared Palacios go to every local meetup you can get to for the next 12-16 months.  Grow your network of individuals who attend these meetups.  That's a start

    I'm getting my license in the city I operate in because I want to get 3% commission on purchase and sale of houses I rehab and sell.  I personally would recommend getting your license because you won't have to rely on anyone else for running comps or putting in offers.

    Lastly -- Passive real estate is an overused phrase for people who only want the benefits of real estate and not the work that goes into actually building a portfolio that produces that type of income.  

    Start going to meetups and let the people in your area who are doing deals guide you.  They'll be better source of help than strangers on the internet.

    1Reply
  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    7y
    Originally posted by @Spencer Cornelia:

    @Jared Palacios go to every local meetup you can get to for the next 12-16 months.  Grow your network of individuals who attend these meetups.  That's a start

    I'm getting my license in the city I operate in because I want to get 3% commission on purchase and sale of houses I rehab and sell.  I personally would recommend getting your license because you won't have to rely on anyone else for running comps or putting in offers.

    Lastly -- Passive real estate is an overused phrase for people who only want the benefits of real estate and not the work that goes into actually building a portfolio that produces that type of income.  


    Start going to meetups and let the people in your area who are doing deals guide you.  They'll be better source of help than strangers on the internet.

    I personally cant see how anyone who is going to be full time or close to full time in this business does so without a license. at least when your a small shop..  or solo..  

    and for sure if your a flipper..  like the bigger builders in our state own their own brokerages   the nationals still farm it out.. but at very reduced rates.

    if your flipping houses its critical in my mind  one to find the inventory make 3% there and to list your own. SAVE 2 to 3%  so in higher dollar areas this can be 10 to 50k per deal.. many times equal to your whole profit. 

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    4Reply
  • Spencer Cornelia
    Investor · Las Vegas, NV · Member since 2017 · 321 posts · 524 votes
    7y

    @Jay Hinrichs exactly how I see it.  I'm just getting started but on the 4 deals I'll be selling this year, I'll be paying around $30k on seller's agent fees ONLY.  Moving forward, that will be an additional $30k profit on the deals I would be doing anyway.

    Biggest reason to get your license IMO.  And the risk reduction of making 3% on sale AND buy no matter what so even if the flip breaks even, you'll still profit.

    0Reply
  • Terrell Garren
    Rental Property Investor · Concord, NC · Member since 2016 · 1k+ posts · 3k+ votes
    7y

    My path (not necessarily the right path) - I didn't do meet ups, seminars, mentors or RE investment books. I bought a SFH foreclosure for $70K in 2008. Did all the work my self - cleaning, floors, paint, fixtures, toilets, used appliances off CL, landscaping, advertise, applications, lease agreement, PM. I did do a good bit of googling & youtube learning - both trades and PM. It took me 8 months of part time labor and probably $2K in stupid mistakes, but it was the best education I could ask for. It's been rented to the same family for 11 years, no late rent, maybe 7 or eight service calls. I guess what I'm saying is - 'just do it' is the best education.

    Disclaimer - I started in 2008 when it was next to impossible to screw up.

    5Reply
  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    7y
    Originally posted by @Terrell Garren:

    My path (not necessarily the right path) - I didn't do meet ups, seminars, mentors or RE investment books. I bought a SFH foreclosure for $70K in 2008. Did all the work my self - cleaning, floors, paint, fixtures, toilets, used appliances off CL, landscaping, advertise, applications, lease agreement, PM. I did do a good bit of googling & youtube learning - both trades and PM. It took me 8 months of part time labor and probably $2K in stupid mistakes, but it was the best education I could ask for. It's been rented to the same family for 11 years, no late rent, maybe 7 or eight service calls. I guess what I'm saying is - 'just do it' is the best education.

    Disclaimer - I started in 2008 when it was next to impossible to screw up.

    08 to 2011 you could have bought boarded up and still made profit 5 years later    tongue in cheek but not really :)

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    WebsiteView Page
    2Reply
  • Terrell Garren
    Rental Property Investor · Concord, NC · Member since 2016 · 1k+ posts · 3k+ votes
    7y
    Originally posted by @Jay Hinrichs:
    Originally posted by @Terrell Garren:

    My path (not necessarily the right path) - I didn't do meet ups, seminars, mentors or RE investment books. I bought a SFH foreclosure for $70K in 2008. Did all the work my self - cleaning, floors, paint, fixtures, toilets, used appliances off CL, landscaping, advertise, applications, lease agreement, PM. I did do a good bit of googling & youtube learning - both trades and PM. It took me 8 months of part time labor and probably $2K in stupid mistakes, but it was the best education I could ask for. It's been rented to the same family for 11 years, no late rent, maybe 7 or eight service calls. I guess what I'm saying is - 'just do it' is the best education.

    Disclaimer - I started in 2008 when it was next to impossible to screw up.

    08 to 2011 you could have bought boarded up and still made profit 5 years later    tongue in cheek but not really :)

     I'd rather the young, new investors not know how easy this game was 2008-2013.  They need to think times have always been this tough and we overcame with sheer brilliance. 

    1Reply
  • Andrew HoganPro Member
    Rental Property Investor · Indianapolis, IN · Member since 2016 · 560 posts · 463 votes
    7y

    48k annual (4k/mo) means you'll need 480k of equity earning 10% or 685k equity earning 7%. I think your first step is to educate yourself thoroughly on different passive investments that produce consistent income. From there you'll need to learn how to evaluate managers/sponsors of those types of assets. Doing this will greatly reduce your risk of losing capital. Mitigation of that risk should be your chief aim!

    2Reply
  • Marcus Johnson
    Investor · Saint Paul, MN · Member since 2015 · 663 posts · 512 votes
    7y

    @Jared Palacios

    According to math and the south Minneapolis area I own a duplex in, just buy 3 duplexes and pay them off ASAP if you already have a good salary and no debt, you’d easily cash flow 50k a year.

    1Reply
  • Jared Palacios
    OP
    Rental Property Investor · Rancho Cordova, CA · Member since 2017 · 9 posts · 2 votes
    7y

    Thank you everyone for your feedback. I do have a rental currently and have been a landlord/investor over the past 15 years. But capital is slim, credit is great, annual income for Northern California standards is low. So I need to syndicate some deals for either equity stakes, or a Fee to start building a bankroll. I am not against pounding the pavement and doing the work myself if I can get a property for 70% FMV and upgrading for a later refi. BRRR would be ideal.

    0Reply
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