Ready to Go....Now What?

Question

It was about two months ago that I made the commitment to move from my regular, corporate sales gig to real estate investing. I originally set my goal to buy my first investment property in two years. Well, I've heard some rumblings that my job may be going away in 2013 so I'm trying to move more aggressively on my dream of being my own boss. So, with that being said, I wanted to provide a little background on what I've done and ask for some advice on what my 1st and 2nd steps should be.

Background:
I've been reading these forums incessantly day and night and have read through a lot of the blog posts and blogs by members here (123flip, Real Estate in Your Twenties, etc.). In addition to internet readings I've read Millionaire Real Estate Investor (Gary Keller), Building Wealth One House at a Time (John Schaub) and just finished Investing in Real Estate (Gary Eldred).

In addition, I've also signed up for my local REIA - just missed their latest meeting - and have attended a few different meetups that different investors have put on. The meetups were decent, some good information, but both ended with a sales pitch so probably something I won't devote a lot of time towards in the future. Finally, I've been digging around craigslist, zillow, trulia, etc. to start getting an idea on prices, rents, etc.

My initial strategy is to target motivated sellers as well as try to establish relationships with REO agents for SFHs within an hour drive of my apartment. I would like to focus on a few, quick-ish flips (minor cosmetics) to get my feet wet with a longer term strategy of moving towards rentals and buy & hold.

Now What?
So, now it's the $64,000 question: Now What? What should be first and second steps be to go from theory to practice? Some things come to mind, but I'm not sure if one should go before the other or if I'm just over-thinking this. Some ideas come to mind:

-Setting up a LLC
-Get a website up and running 
-Create a comprehensive business plan with 1, 5 and 10 year objectives
-Get a cell phone (current employer provides my cell phone)
-Talk to a CPA (girlfriend's dad owns his own accounting firm)
-Start marketing to potentially motivated sellers
-Talk to landlords to get a gauge on my future competition
-Reach out to RE agents

Wow, that turned out to be a bit longer than I anticipated. Anyways, I'm hoping some newbies and more experienced people can jump in here and talk about some of the initial things they did to turn thinking/reading into action. Any advice is much appreciated!!

Brandon Foken · Answer

Dale, thanks for the reply as you've replied to both of my posts which is always appreciated. However, I don't think fear is an obstacle for me. There is no nagging voice in the back of my head saying I can't do it. In fact, the only voice in my head is DO IT, wait are you waiting for? But I can definitely see others having this problem.

Jon's response confirmed some of my assumptions: mainly that I was over-thinking things. I will continue to research my surrounding areas and target a few specific areas that I will focus on.

Regarding agents, what is the best way to size them up? Jon recommends working with AN agent (which I take to me only one). What sorts of questions do you ask them to judge their credibility/knowledge/experience? Basically, how do you know you are tied to a good agent vs. one that is so-so or a time waster? Does anyone have any agents they've worked with in the East Bay of California that they could recommend?

Jon Holdman · Answer

I'd have a slightly different list:

- Look at properties in various areas.  Find a good farm area.  For fix and flips, that's one where you can find properties cheap enough to buy but with enough retail activity for you to sell your fixed up property.
- If its rentals, find an area where 1) the price to rent ratio is low enough to make money, 2) there is rental demand, and 3) you can buy at something of a discount.
- Find AN agent to work with to make your purchases.
- make offers.

Don't fall into the trap of worrying about LLCs or web sites or (IMHO) business plans.  Creating an LLC is a quick exercise.  Sorting out your taxes can be done with a CPA once you actually have a start.  Asset protection can be done once you have assets to protect.  Your business plan can say "I want $10,000 a year in rental income so I need 25 paid-off rentals.  So, I'll kick in $10K a year and buy them as fast as I can."

Dale Osborn · Answer

When you reach a certain point and decide that you are ready to make the leap into actual investing sometimes fear kicks in and tells you to back off. Sometimes the answer is just do it. When you get that first deal completed, things get easier the next time around. Getting over the bump in the road from fear is the main thing. You have already got yourself some education and are ready to go. Perhaps to help overcome the fear factor a mentor from the REI group should take you through the first deal and then you will have a better feeling towards investing on your own.