My goal for the New Year is to buy my first rental property .Been doing allot of research and joined Lifestyles Unlimited to help mentor me.
Any good advice in general to avoid any mistake before purchasing? Any loan companies you prefer in Texas ?
@Sade Estronza research BP extensively and learn to network set BP keyword alerts to Texas investor rental multifamily etc to get alerts Everytime a member mentions them. Logan Ryan is great and a few levels ahead of you.... Reach for folks that have the time to teach he is very accessible and can further advise you he had an awesome post on Texas forum with two of his deal mentors check him out !! Good luck and welcome !
- Don't make an offer until you've physically seen at least 25 properties so you have an idea of actually what each price point looks like in person.
- Don't let anyone tell you to buy your first investment property in an area that you can't drive to in 15 minutes.
- Don't spend money on mentoring. Don't buy anything a mentor company is offering.
- Make friends with a local real estate agent who is an investor so they won't mind showing you junk properties.
- Create as large a reserve as possible for when you buy because all of the calculators will give you monthly expenditures moving forward, but will not account for a lump sum repair which will always be needed right after closing.
I hope those help.
If you do not have experience in understanding home issues (I certainly didn't) try and find an objective person to review homes with. Pay them for their time. They can walk through and show you problems and how much it'll cost to repair. I have a friend who does handyman work and since he's a friend, he's brutally honest about issues that he can see.
I like visiting homes, if possible, after large rains. Can tell you if there are roof leaks, foundation issues, gutter problems, water in basement problems, etc.
Do not expect to walk into *any* property and not put a dime into it. A reserve of 5-10k PER UNIT is not unreasonable, as @Jonathan Greene indicated (great advice all around, Jonathan). Try and take care of problems before any tenants move in.
Don't do this for meager income. Your first deal should be profitable enough for you to want to do it. If it isn't, it isn't the right home, the right time, or the right deal. 1 out of every 100 (not scientific, but perhaps on average) deal that comes across your desk will be worth looking into.
If you see people rushing into markets at an untenable rate, it should tell you two things -- one, people know what they're doing, and two, they're being followed in by people who have no clue. Unless you're in the first group, make sure you aren't in the second.
Don't guess what is good advice and what is bad advice. You already have access to the best strategies in a simple-to-understand format through Lifestyles.
Since you are already an LU member and live in Texas, attend the next Lifestyles 2-day event. Attend the next one. Absorb the content. There should be at least 2 each month within an easy drive of your location. If you happen to be busy on the weekends, you can watch the recorded classes online any time. Even better with the online version, if there is a particular topic that confuses you, you can watch it again and again.
@Sade Estronza Just curious Sade. By joining Lifestyles Unlimited, are you not receiving in any investment guidance for your financial investment in that program?
Yes I actually am, but I definitely love to hear what other successful investors have to say outside of LU.
Thanks so much .