New to REI in MA/RI looking for advice

Specialist · Victor, NY · Member since 2013 · 823 posts · 844 votes

One thing I always caution people on is what I call a "so that" mentality! We all fall into it at times and I believe the better we are at recognizing it, the better off we will be. I see it in you post above when you say that you want to start in SFH or multis SO THAT you can get into commercial or storage. Does that mean what you really want to do is commercial or storage? If so, why not start there!? Shortest way to anywhere is a straight line. Now, you may have VERY legitimate reasons for formulating the path you outlined above and if those plans are founded on valid truths, there's no reason to change. I often see new investors formulate "so that" plans because they think it's the only way. I know this because I've been guilty of it more than I'd like to admit.

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Anthony ThompsonPro Member

Buy and Hold Investor · Cranston, RI · Member since 2013 · 1k+ posts · 1k+ votes

6y

@Andrew Sprague welcome to Bigger Pockets! It sounds like you have a pretty good foundation to start with and I'd be happy to connect as you said.

If your main goal is to connect with others right now then I'd also recommend attending local real estate groups such as Black Diamond REI in Burlington and Worcester, or the RI real estate investors group in RI. I've attended both groups and found them to be great for networking and education.

Michael raises a good point about starting out where you'd like to eventually be, but I will make an exception and that's "house hacking" or living in a multifamily building yourself and renting out the other units.

With that, you get great owner-occupied financing terms and you get to start to learn about real estate. It might not be self storage or commercial but I do think it's a good way to get your first real estate asset and learn about tenants. (Commercial tenants are usually easier to deal with but you can have long vacancies - and self-storage is its own specialty as Michael mentioned.)

One minor note: You mentioned still having student loans, and I heard a podcast recently which said that if you can still afford to make your payments, any payments will go 100% to principal between now and September. So that's really a powerful way to work on that balance if you're able to, especially as several investors I know are waiting to see what the economic fallout of Covid-19 will be for real estate.

For example, it's possible we could have a wave of foreclosures that would affect values of other properties. It might not happen, but while I still know people who are buying, I also know other experienced investors (especially hard money lenders) who are pulling back right now and taking a wait-and-see approach.

So it's worth considering an aspect of the same, at least as far as pure investment properties go. If you need to change your living situation though, I think house hacking is a special case and as long as you can afford the property, is probably fine to do any time. It's a great way to start in the Real World school of real estate :)

2 Reply

Ronak Shah

Northern NJ · Member since 2018 · 128 posts · 39 votes

6y

@Andrew Sprague just like @Michael Wagner said one doesn't really prepare you for other! If you want to get into self storage or other commercial class then there is no need to spend time on residential side. The more distractions you add the less your snowball effect will be! If your short term plan is based on lack of access to capital then you may want to trade your time for partnership with person with money and get over that hump! Surest way to do that if you don't have connections to people with $$$ is by creating your platform and identity by summarizing what you're finding with others (think YouTube, Instagram, FaceBook, even BiggerPockets). Hope that helps!

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Paul MoorePro Member

Commercial Real Estate Fund Manager · Lynchburg, VA · Member since 2015 · 1k+ posts · 1k+ votes

6y

Hi @Andrew Sprague. You are in the right place! I must agree with @Michael Wagner that you could skip the residential realm and get right into self-storage. I will be glad to send you an eBook on that topic if you're interested, but it would be far more helpful if you can get training from Scott Meyers, a long time BiggerPockets contributor. He has some great training as well as a mentor network that will allow you to partner with others on deals.

If you decide to go the SFR route, you may want to wait a little longer until the aftermath from this Covid situation hits real estate. And consider other locations that have lower downs and higher highs (more variation in price) like Florida. There is a great book by BP contributor Chris Prefontaine called Real Estate on Your Terms that could be very helpful now and more so in the near future.

Good luck!

Podcast Guest on Show #533

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Sam AlbertPro Member

Realtor · Providence, RI · Member since 2016 · 98 posts · 66 votes

6y

@Andrew Sprague Congrats in advance on all your upcoming success. Real Estate is a great tool to financial freedom, so you're on the right path.

I'll keep it short and sweet and just give a suggestion to buy a multi-family before buying a single family. It sounds like you're considering a single family in your short term goals, I would say not to! Utilize FHA to purchase your first multi family property with little (3.5%) to no money down, and then go from there! Once you get the first one, you'll want more!

I will also recommend to ask the same question to 3 different people. That's my way of hearing different perspectives, thought processes, and opinions. So for anything that you don't have a clear understanding on, ask 3 different people/search for the answer using 3 different sources (youtube, bigger pockets, google.)

Best of luck on all of your endeavors. Don't hesitate to reach out to me, if you have any questions.

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James Wise

Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 31k+ posts · 20k+ votes

6y

Originally posted by @Andrew Sprague:

Hey Everyone,

I am a rising Senior finance, management and MIS major looking to jump into REI full time as soon as possible. I am 10 hours from finishing my RE license training, looking to take the test in August. I have been researching rental property investing for about 2 years now as I've been saving and earning my degree and I'm getting ready to make my first move in the Providence area or the Greater Boston area. I've built my credit to foster the best interest rates and qualifications for loans and my student debt is fairly low (<20k). In the short term I hope to buy a multi family or SFR, most likely an owner occupant agreement, within the next 12 months. I still have 2 semesters left but with COVID it could hopefully be less. In the long term I want to own multiple properties and get to the point where I can save up enough money from rentals/flips to get into self storage and commercial properties. Since most of my research and knowledge has been on my own time I want to reach out and see if there is anyone who would like to connect and tell me about their experiences with analyzing the market, running estimates and calculations, and scaling up. Any advice, replies, or suggestions are greatly appreciated.

Welcome aboard Andrew.

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New to REI in MA/RI looking for advice

New to REI in MA/RI looking for advice

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