Fastest Way to Make $1 Million?

Real Estate Agent · Cleveland, OH · Member since 2020 · 280 posts · 365 votes

If you were advising a new investor starting out, what would you say would be the fastest way to make a million dollars investing in real estate? When I say fast, I don't mean get rich quick. I mean the most direct route from A to B.

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Ujwal Velagapudi

Investor/Agent/Entrepreneur · Dallas, TX · Member since 2016 · 464 posts · 564 votes

This is going to come down to the individual and their gameplan, current financial situation, risk appetite, and so many other factors. If I was advising a new investor, I wouldn't tell them to worry about how to get to $1M...yet. First focus on understanding the RE landscape, get your feet wet either through investing, brokering, renovating, managing, etc. in the field either directly or through other investors. Then just jump into something you like and see potential with, and try to become an expert at it. The fastest way to your target financial goal will be being an expert within a particular niche and driving it hard.

You can get to $1M in an infinite number of ways, and just because "X" did it in 1 year by using a certain RE strategy doesn't mean that "Y" will see the same results in the same time. Just like a fitness plan, everyone is very different with so many external variables that will play into the outcome. I used to own a gym, and my personal trainers would always tell our clients to focus on what works for them, and create a custom plan based on their current state, limitations, strengths, weaknesses, goals, etc.

I first started investing in C (some people might call them D) neighborhoods in Detroit. I put my life savings into a tiny commercial building, and snowballed my RE business in the city. I was very naive, putting myself at risk every time I went to the buildings as there was a lot of violence around us and even on our block. But this was my specialty; I knew the area, the types of properties I was purchasing, how to genuinely take care of my tenants, how to find good deals, what was a good vs. a bad purchase, etc. What initially gravitated me towards this was the low purchase price and high cash flow, which as a 22 year was all I took into consideration. I slowly divested and have gone away from this strategy recently, but it did more than 5x (cash flow + appreciation) my investment within a few short years.

So if you asked me a few years ago as I was starting out, I'd say that investing in C neighborhoods is the fastest way (which I really believed then). Today, in a different financial state, I will be considering a different route (apartment complexes, hotels, motels, mobile home parks, etc.) in slightly better neighborhoods. Tomorrow, when I have a wife, kids, etc. there will be other variables that will come into play based on the situation at the time that will definitely alter my investing strategy.

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Storm S.
Real Estate Agent · Santa Barbara, CA · Member since 2016 · 518 posts · 283 votes
6y
@Aaron K. You forgot to mention they should be deep out of the money monthly options
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Erin Dorsey RobinsonPro Member
OP
Real Estate Agent · Cleveland, OH · Member since 2020 · 280 posts · 365 votes
6y
@Dustin Hood That's a good one! Clear, simple and doable with the right analysis on the front end and a good dose of self control. Thank you for your response. Someone is going to see that and be inspired.
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Erin Dorsey RobinsonPro Member
OP
Real Estate Agent · Cleveland, OH · Member since 2020 · 280 posts · 365 votes
6y
@Troy Forney I am with KW and wouldn't have it any other way. Extremely entrepreneurial brokerage. I have not listened to Linda's podcast personally, but I've heard good things. I'll check it out and hopefully some aspiring investors will see your post and do the same. Thank you for responding.
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Steve Vaughan
Rental Property Investor · East Wenatchee, WA · Member since 2014 · 10k+ posts · 16k+ votes
6y
Whoops. Duplicate
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Steve Vaughan
Rental Property Investor · East Wenatchee, WA · Member since 2014 · 10k+ posts · 16k+ votes
6y
Originally posted by @Erin Dorsey Robinson:
what would you say would be the fastest way to make a million dollars investing in real estate?

Depends on what you're good at, what you like and your why. A million bucks is a result of a strong why and feasible plan.

Also depends on where you're starting from and what you have to work with. $500 and $100 a month or $500,000 and $5000 a month would take different approaches.

How many marbles can I fit in a bag? With no other info, that's what your asking.

Keep taxes in mind. Flipping is just earning more ordinary income. I used solid buy and hold homes and apts purchased under market value. YMMV.

4 Reply
Nick Rutkowski
Rental Property Investor · Ithaca, NY · Member since 2015 · 1k+ posts · 1k+ votes
6y
@Erin Dorsey Robinson
I think you’re asking the wrong people. My good dude Pablo from Colombia can hook you up with a million. Maybe when he gets off house arrest I can introduce you two. I got my other dude Tony from Florida, he’s filthy rich too but for some odd reason always wants people to say hi to his friend. He can hook you up for sure. So maybe the quickest way is to ask for the money as far as who do you ask, lemme quote my dude Jack Black. “Read between the lines.” (This is a joke.)
1 Reply
George W.
Investor · NJ · Member since 2018 · 869 posts · 921 votes
6y
I see people with a lot of suggestions but no one really stated the obvious. Save money and budget. Wealthy people dont get rich by spending all their money.

What good is making a million dollars if it cost you $990,000 to make a million?
Its actually funny if you ask most people why they want to be rich, usually the answer is they want to spend more money and buy a giant house, a fancy car, yacht, retire at 20 etc. Even being relatively wealthy you can burn through your entire savings through spending on shinny things.
7 Reply
James Egodibie
Member since 2020 · 1 post · 0 votes
6y
I think it is an easy question and there are great ways to legitimately do that in a short period of time...
0 Reply
Kenneth GarrettPro Member
Investor · Florida Panhandle/Illinois · Member since 2016 · 4k+ posts · 3k+ votes
6y
@Erin Dorsey Robinson
The answer varies depending on what a million dollars is to you. Is it net worth or actual cash? Is it cash over time or a million in the bank? When I started out, I wanted to have a million in net worth, but quickly realized that didn’t really matter. Cash flow is what mattered. Deriving income is the goal. I started thinking flipping was the way to go, but eventually realized rental property in the long run outperformed flipping. I now calculate rental income as my goal. If I needed to make $10,000 a month to be comfortable in rentals that would take 10 rentals paid off. 20 rentals at $500 cash flow. I thing the millionaire next door book says it correct. It’s how you value success. Begin with a reasonable goal and as you get close to achieving that goal create a new one. The best thing about goals or revenue it’s your goal and no one else’s. Buy the way 10 paid off properties would be way more than a million in net worth. Just saying.
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Bill Goodland
Rental Property Investor · Allentown PA, United States · Member since 2016 · 567 posts · 442 votes
6y
@Erin Dorsey Robinson you make money by creating value. Do you mean a million dollars in net worth? Or a million in cash? If we're talking real estate, the fastest way to a million would be to BRRRR commercial properties and if cash, probably flipping. If we're talking outside of real estate, fastest way to a million in net worth would probably be to start a business that get an infusion of venture capital money that would not allow the level of your equity in the business to be over a million. Fastest way to a million cash would probably be to buy a business, turn around it's operations and exit via a sale.
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John Collins
Investor · Tx, GA · Member since 2019 · 313 posts · 337 votes
6y
Originally posted by @Erin Dorsey Robinson:
If you were advising a new investor starting out, what would you say would be the fastest way to make a million dollars investing in real estate? When I say fast, I don't mean get rich quick. I mean the most direct route from A to B.

Fastest? Always flips. Adding value and relying on appreciation and being in a hot locale. My friend had a property, a piece of land, he bought for 250k in an area on the outskirts of the city. Airport proposal was on going, 4 months after, boom, it was approved and construction started immediately. Property was immediately worth $1 million and he got $1.25 for it. Deal closed fast as well.
1 Reply
Devin D.
none · Member since 2017 · 49 posts · 24 votes
6y
Originally posted by @Erin Dorsey Robinson:
If you were advising a new investor starting out, what would you say would be the fastest way to make a million dollars investing in real estate? When I say fast, I don't mean get rich quick. I mean the most direct route from A to B
@Erin Dorsey Robinson Perhaps a reframe of the question to be: "What is the most most efficient way to make a million dollars investing in real estate?" Speed requires more resources upfront and is often more risky.
Case in point... house hack a million dollar poroperty with 10% down... your realized value in 30 years will be over a million... or house hack a 350k house every year for 10 years... (10% down payment and 10% HELOC to avoid the PMIs) have it in a good area that is growing... In 10 years you have spent (and I'm generalizing) 350K (35k a year), and control 3.5Million in realestate. Have all the properties on 30 year fixed, ensure they cash flow well (200 bucks a door cut it in this example). Refi as you wish or just pay them off over 30 years or snowball the cashflow and pay them off sooner. After 30 years, having bought in a good area, these initial properties have paid for themselves and are now worth 750k+ each.
BRRRR is an amazing strategy for foreclosed properties...you just need access to cash and I can say I've personally had infinite retunes and had my monthly cashflow be more than my operating cost ongoing. Its can seem slow and tedious but it's less risky, less capital, and doing it for 30 years should leave you much further along then just having made a million dollars a year.

At a certain point with the BRRRR strategy and many others you engage the compound effect and enter an exponential curve. If a million dollars is your goal then if you have a lot of capital... you should have no problems mitigating risk and achieving this goal... if you are not starting out with much capital and need to conserve it... well time and appropriate leverage can be a great friend.

2 Reply
Joshua Myers
Rental Property Investor · Columbus, OH · Member since 2014 · 148 posts · 177 votes
6y
I think the most direct way is to buy $1,000,000 of quality real estate (no war zones) with leverage, preferably on 15 year mortgages. Rent it out and use any extra cash flow to pay everything off faster. Depending on your current financial situation you can house hack, BRRRR, or save/flip/wholesale to get down payments.
How fast this all happens probably depends most on what/where you buy.
3 Reply
Shiloh LundahlPro Member
Rental Property Investor · Gilbert, AZ · Member since 2016 · 3k+ posts · 4k+ votes
6y
@Erin Dorsey Robinson You can probably become a millionaire within 5 years if you are willing to do the work that it takes to become a millionaire within that time frame.

Here’s one answer, become the personal assistant of someone who is already a millionaire (preferably multimillionaire) and work like a dog for that person over the next 5 years. Watch what they do, and do that on a small scale until you can eventually do what they do on a bigger scale.
Associate with millionaires at conferences and meetups. Continue to read and listen to people who are millionaires. Through reading, listening, and associating and then acting on the things you learn you will get there faster. Get a mentor who is a millionaire. Live as cheaply as possible at first. Take advantage of leverage responsibly. I agree with the idea that @Account Closed stated about house hacking. Those are some ideas.

Also, read the book The Millionaire Fastlane by MJ DeMarco. He offers some great insights.
480-206-1209 Podcast Guest on Show #287
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Adam Blachnio
Rental Property Investor · North East US · Member since 2019 · 114 posts · 31 votes
6y
@Erin Dorsey Robinson
Create Multifamily opportunity for investor giving good return on their money while you getting the spread and after refy you pulling out mooore tax free cash. It's your unlimited return, while still keeping the asset in hand.
That's what we're doing.
1 Reply
Aaron K.
Specialist · Riverside, CA · Member since 2015 · 6k+ posts · 3k+ votes
6y
@Storm S. pretty much but I think weekly would technically be faster.
Shower thought:
I have a small electronic prism that if I touch in the right places at the right time will make more money than the lottery.
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Heath Jones
Rental Property Investor · Enterprise, AL · Member since 2019 · 137 posts · 85 votes
6y
@Erin Dorsey Robinson Secure a 6 figure income, live in the cheapest apartment you can find, eat beans and tuna, spend no money on anything other than essentials, then funnel all your excess cash flow into buy and hold real estate. Once you have enough equity to equal 1mil plus what you would pay in capital gains tax, fire sale it all. Boom. 1million dollars
😁
3 Reply
Syed H.
Developer · NY/NJ/PA · Member since 2018 · 758 posts · 935 votes
6y
SFH flips is IMO the easiest with a little luck and experience. Land Flipping for the ones who are willing to take the risk.

But if you want to make that level of income, and relatively quickly (2-5 years), businesses is the answer, not RE.
4 Reply
Gregory SchwartzBusiness Member
Rental Property Investor · College Station, TX · Member since 2016 · 1k+ posts · 1k+ votes
6y
Over 3 years buy 3 house hacks at 300k each (so you can take advantage of lower down payment options). Over the next 10 years put all your cash flow to pay down your mortgage. Throw in some appreciation (4% per year) subtract some inflation (2% per year) and BAM 1,000,000 debt-free American dinero! Plus you'll likely have some healthy cashflow maybe 3-5k a month.
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Chinmay J.
Investor · Northern, VA · Member since 2016 · 1k+ posts · 904 votes
6y
Originally posted by @Erin Dorsey Robinson:
If you were advising a new investor starting out, what would you say would be the fastest way to make a million dollars investing in real estate? When I say fast, I don't mean get rich quick. I mean the most direct route from A to B.

Really not a very good question, unless of course it's meant to be a trick question.

First of all I would never advise any investor anything close to that.. What is fast? Who decides? Fast for one might not be quick enough for the next one... What do you mean invest in real estate? Flipping? Buy and Hold? Notes? Lending? Realtor? RE Attorney? Title Company? Brokerage? A million different ways to skin that cat.. Whom am I advising? Broke kid with holes in shoes, or some kid with a rich daddy who can give a seed money of $100K, and won't even notice it in his bank balance..

1 Reply
Mike Westen
Investor · Chicago · Member since 2020 · 13 posts · 9 votes
6y
Buy a business. I'm looking buy one now. 400k and cash flow of 180k. Plus with cash flow like that banks just throw money at you. And you can just keep reinvesting.
But if you don't know anything about the business you will fail and your employees will take advantage of you.
Risk/Reward
3 Reply
Roger Hefner
Yuma, AZ · Member since 2015 · 140 posts · 137 votes
6y
@Erin Dorsey Robinson I know someone who learned the diamond business. They get from where ever and bring back selling to a diamond guy in NYC . Makes 40 to 60 K a rock. Sorry can't yell u more I dont know.
1 Reply
Paul DoCampo
Specialist · ID · Member since 2015 · 121 posts · 53 votes
6y
I don't think there's a direct way to this. I haven't achieved this goal so take what I say for a grain of salt and follow what the other millionaires on this thread tell you... but from working my way towards this goal and being immersed in the industry ...

... I've come to the conclusion that there's NO WAY WAY to do things.

I know this sounds cliche but you have to forge your own path because someone else isn't in your location, doesn't have the same personality as you, doesn't have the same skill sets as you, etc etc. In fact, even REI may not be that ONE path for you (there are millions of ways to make a million dollars REI is just one way)

I have shifted from business to business, strategies to strategies I have come to that conclusion, that I can't follow ONE persons path. Yes follow others' strategies but be mindful that they aren't in your location/life/personality so you have to shift and change things a bit to fit it.

But here's the definite answer taken from Earl Nightingale that directly your question:

THE AMOUNT OF MONEY YOU MAKE IS DIRECTLY PROPORTIONAL TO THE AMOUNT OF VALUE YOU BRING TO THE MARKETPLACE.

I know, not that answer you're looking for but it's the truth. Money is the byproduct. Too many investors think about the byproduct ONLY , and not the value they need to bring to get it. What kind of value are you bringing to: private investors, retail buyers, motivated sellers, other agents, etc. ?

1 Reply
Mary M.
Rental Property Investor · Portland OR · Member since 2018 · 2k+ posts · 3k+ votes
6y
I would say, based on experience, to purchase a small (10 ish unit) commercial multi family in a university town. Make sure you buy where you can raise rents each year. Hold the asset for 5 -7 years. Sell and 1031 into the next biggest asset you can buy in an excellent location. Be sure you can raise rents. Hold for 5-7 years .... rinse repeat.
This is how the big guys generate massive wealth. We smaller investors can do similar using the same methods ...
4 Reply
Daniel B.
Rental Property Investor · Saint Louis, MO · Member since 2012 · 115 posts · 42 votes
6y
@Erin Dorsey Robinson
Buy a million dollars of real estate - financed and have the tenants pay off the mortgage for you. -paraphrasing “creating wealth one house at a time”.
This is the easiest way for the typical non high wage earner to become a millionaire.
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