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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Caleb Heimsoth
Rental Property Investor · Durham, NC · Member since 2016 · 7k+ posts · 7k+ 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.

I gave a sarcastic answer before, so here’s a real one, in step by step order of how I personally am doing this (in a way).
1. Pick a high paying field and get a bachelors degree/masters degrees. I chose engineering.
2. Get a job in said field and live frugally. Invest what you save in real estate and the stock market
3. Do this for 10-20 years. Poof you’re a millionaire

4 Reply
D Turner
Member since 2019 · 17 posts · 48 votes
6y
@Erin Dorsey Robinson
If I told you guys my trademark, patent, highly protected secrets then I wouldn't find anymore "distressed facilities". Hint... (Happy Saturday)...
Covid has made immediate millionaires with tremendous risk.
2 Reply
Zion Durham
Rental Property Investor · Miami Gardens, FL · Member since 2019 · 6 posts · 2 votes
6y
@Erin Dorsey Robinson
I'm starting from A to ZZ, I believe education will be your best friend. Read BRRRR and Long Distance Real Estate Investing by David Greene. Also, Rich Dad Poor Dad by Robert Kiyosaki.
After educating yourself. Find a market base on advice or information from “Very Smart People”. Who can be Real Estate Agent, Lenders, Property Managers, etc.
If you have money saved up, start with a small props that’s adorable or do owner financing, and use money to rehab a property if the property is in “DISTRESS”, mybe even a Hard Money lender.
Once again... Just knowing how to be creative with or without starting funds, mybe even partner with someone outside your area but who wants to invest in your market or a market of your choice.
Think Outside box 📦..
Sorry hope this help you to get out there and make mistakes (life is THE BEST TEACHER)!
1 Reply
Bob ReinhardBusiness Member
Lender · Patterson, NY · Member since 2017 · 488 posts · 186 votes
6y
@Erin Dorsey Robinson
I lend private and hard money. Most of my loans are less than a year and there is a first position. Like any other loan, it could risky, as all investments are, but the returns are good.
Rental are long term adequate.
Rehabs may be tricky in this market.
Much success!
Bob
[email protected]914-861-5501
1 Reply
Andrew Kiel
Investor · Tucson, AZ · Member since 2017 · 208 posts · 235 votes
6y
Great question with so many possible answers. The vehicle and strategy can vary widely. Just a few realistic ways from my point of view without taking high risk:
1. Leverage money. One of the best points of real estate is you can buy using high leverage and still do it with relative safety. Buy as many positive cash flowing properties as you can with leverage.
2. Leverage your network. You have the ability to buy as many properties as you want if you have money or joint venture partners.
3. Consistently save and invest. If you just purchased one cash flowing single family home every 1-3 years it would be virtually impossible to not be a millionaire after 10-15 years. Use time to your advantage. It may not be the fastest way but it's highly likely.
1 Reply
Blake Harris
Kansas City, MO · Member since 2020 · 35 posts · 10 votes
6y
@Erin Dorsey Robinson
Many that reach 1M in net worth quickly start with a multi-family house hack. With an FHA loan, you could put as little down as 3.5% on essentially an investment property. If the numbers work just right you many cash flow while also living free, and on top of that you begin to gain equity.
After year 1 you could then refinance into a conventional loan and move into another multi-family with another FHA loan. You now have 2 multi-family properties only in at 7%.
To go even faster you more than likely could invest the money you are now saving from rent into another single family as a buy and hold investment (rental).
After just a couple of years, with the mortgage pay down, appreciation, and the cash flow you would be worth 1M.
On top of that, if you would like to go even faster you could do a couple of flips. I could feasibly see you seeing your first million in 4 or 5 years following a similar plan.
2 Reply
Damaso Bautista
Rental Property Investor · Hawthorne, CA · Member since 2018 · 655 posts · 900 votes
6y
@Erin Dorsey Robinson

If anyone reading this is just starting out from scratch with very little money but tons of will and self discipline, the following two responses from @Caleb Heimsoth and @Heath Jones are the two real actionable items that I have first hand experience with that works. It's not fast, it is a marathon and sometimes it is a lifetime. If you want to reach that million dollars it can be done.

(Heath Jones) 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

(Caleb Heimsoth)
1. Pick a high paying field and get a bachelors degree/masters degrees. I chose engineering.

2. Get a job in said field and live frugally. Invest what you save in real estate and the stock market

3. Do this for 10-20 years. Poof you’re a millionaire

Both of these responses are both realistic and actionable.
My personal experience follow almost exactly what Caleb outlined except I am in a different field.
I hope the people who are sitting there and willing to put in the time(years) and effort(no shortcut or get rich quick BS) take notice of these responses because they are in my opinion are the realest way for the common person to reach this financial goal.
Good Luck!!!
3 Reply
Chris SeveneyBusiness Member
Moderator
Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
6y
@Erin Dorsey Robinson
Marry into it
7e investments53 Reviews
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5 Reply
Philip Mui
Member since 2018 · 1 post · 0 votes
6y
I'm still a newbie and haven't invested in anything yet, so my suggestion might not be useful. However, what is considered as 'fast'? Is it 6 months, 12 months, 2 years? From the research I've seen, a fix and flip done right is the REI style that could help the investor earn more within one deal compared to rentals. But then again, how much does this person actually know about REI? If they are just starting, it's good to give them suggestions, but they will ultimately have to do their own research to see which style of investment they would be comfortable getting into and then learn on the how.
As I had already mentioned, I'm completely new to this and have not done any deals yet. However, I know that I want to do rentals and utilize the BRRR method. Before getting into rentals though, I decided wholesale would be a good way to start as a way to obtain and improve specific skills I would need, such as accurately analyzing deals, accurately figure out the ARV, becoming more confident communicating with sellers and buyers, and knowing who I would actually need in my team. Sure, I want to make money, but as a beginner, what's most essential is learning the what and how first. Money will come along the way, but you can't bake a cake with only purchasing the ingredients and not know the recipe.
0 Reply
Erin Dorsey RobinsonPro Member
OP
Real Estate Agent · Cleveland, OH · Member since 2020 · 280 posts · 365 votes
6y
@Adam Blachnio I agree. We are getting started with raising money for multi family or single family portfolio deals in addition to our existing buy and holds. What asset class and part of the country are you investing in?
[email protected]
0 Reply
Blake Harris
Kansas City, MO · Member since 2020 · 35 posts · 10 votes
6y
@Chris Seveney
I like the way you think.
0 Reply
Erin Dorsey RobinsonPro Member
OP
Real Estate Agent · Cleveland, OH · Member since 2020 · 280 posts · 365 votes
6y
@Kenneth Garrett this is good advice. We share your view. We buy and hold property in Cleveland. A lot of people say that flipping is the way to go but over the long term your cash flow determines your lifestyle. Thanks for responding.
[email protected]
1 Reply
Erin Dorsey RobinsonPro Member
OP
Real Estate Agent · Cleveland, OH · Member since 2020 · 280 posts · 365 votes
6y
@George W. I think it’s a “yes and”... your advice combined with some of the other suggestions will offer new investors an important perspective on the discipline required to actually accumulate wealth. Thanks for posting.
[email protected]
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Adam Blachnio
Rental Property Investor · North East US · Member since 2019 · 114 posts · 31 votes
6y
Originally posted by @Erin Dorsey Robinson:
@Adam Blachnio I agree. We are getting started with raising money for multi family or single family portfolio deals in addition to our existing buy and holds. What asset class and part of the country are you investing in?

We're income buyers, so if the numbers are right, we can buy anywhere and for any price. Period.

1 Reply
Account Closed
Rental Property Investor · Canton, OH · Member since 2017 · 1k+ posts · 1k+ votes
6y
@Erin Dorsey Robinson
Easy, play the doubles game. Start with $1,000 and double your money 10 times.
0 Reply
Tyler D.
Member since 2019 · 219 posts · 99 votes
6y
Start with 2 million, get married.
Get divorced. Congrats, you have 1 million.
4 Reply
Joshua Howaniec
Contractor · Indianapolis, IN · Member since 2016 · 267 posts · 144 votes
6y
@Erin Dorsey Robinson befriending a wealthy investor and hoping they leave their million to you when they die.
1 Reply
Kelly Iannone
Rental Property Investor · Orlando, FL · Member since 2018 · 301 posts · 354 votes
6y
@Erin Dorsey Robinson I’d much rather have $0 net worth and $10k mo in passive income then $1M cash. (Although if I had $1M cash I’d be buying buy and hold’s with leverage for the passive income, debt pay down, and appreciation, tax benefits)
1 Reply
Eric X.
Real Estate Agent · Naperville, IL · Member since 2014 · 196 posts · 130 votes
6y
500k on Black. Super fast but high risk.
2 Reply
Erin Dorsey RobinsonPro Member
OP
Real Estate Agent · Cleveland, OH · Member since 2020 · 280 posts · 365 votes
6y
@Bill Goodland I meant this question to be answered from whichever perspective respondents have experience in and can speak to. I agree that the BRRRR method is the way to go in real estate. It is certainly the approach we have taken. Just trying to offer new investors a number of different approaches to consider. Thanks for contributing your thoughts.
[email protected]
0 Reply
Erin Dorsey RobinsonPro Member
OP
Real Estate Agent · Cleveland, OH · Member since 2020 · 280 posts · 365 votes
6y
@Zion Durham Zion it sounds like you are off to a good start. Those books have been helpful to us in building our portfolio. I think new investors will benefit from your advice.
[email protected]
1 Reply
Justin Jones
New to Real Estate · Virginia Beach, VA (Virginia Beach) · Member since 2020 · 29 posts · 19 votes
6y
Originally posted by @Caleb Heimsoth:
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.

I gave a sarcastic answer before, so here’s a real one, in step by step order of how I personally am doing this (in a way).
1. Pick a high paying field and get a bachelors degree/masters degrees. I chose engineering.
2. Get a job in said field and live frugally. Invest what you save in real estate and the stock market
3. Do this for 10-20 years. Poof you’re a millionaire

This is super great advice. With the right amount of income and really living frugally it's totally achievable in 10 years.
1 Reply
Huy N.
Houston, TX · Member since 2013 · 483 posts · 189 votes
6y
Looking back to my 8 years in real estate Although I created more than a million in equity in real estate. I think I could have done better if I focus on the active income a bit before shifting to passive income.
The thing with investing is that if you start out too small, the return - no matter how high the ROI - is still too tiny to make a difference in your life. I just to be proud of my 15% Cash on Cash Return, or infinite return on a Single Family house. but in the end, that $4,000 or $6,000 per house per year won't make much difference in my life, sometimes that gain got wipe out with just one single AC replace or roof replace lol
Yea yea yea, my cashflow excess my expense so I could go brag with people I am financially independent and stuff but I know that if I still look at the price when I go to a restaurant. I am not there to where I want to be yet...
I would tell my younger self to focus more on the active income, go do more flips, quit your job earlier, create some good hustle income stream instead of just solely focusing on investing.
Hope that help
4 Reply
Jared Smith
Real Estate Broker · Scottsdale AZ & Cleveland, OH · Member since 2019 · 168 posts · 109 votes
6y
To add my $0.02 from personal experience:
Graduate from college with a business degree.
Secure a W-2 Sales Job where you can learn customer service & sales management.
Live extremely frugal until you can save enough for a 25% down payment on a 2-4 unit property.
House Hack & self-manage where you learn property management.
Build contacts for everything specifically contractors/trades.
Open up a HELOC on your primary residence every time 1-3 years after purchase + you get free appraisals.
Study/learn/talk with mortgage lenders even if it's not fun to you - crucial for scaling up.
Continue to buy 1-2 properties each year for buy & hold.
Continue to work your W-2 & develop that career while learning REI.
Get your Real Estate License!
Max out your 401k & Roth IRA's each year & invest everything else into real estate.
Self-directed IRA's for buying more properties.
ONLY BUY WHERE YOU KNOW***
Network, have fun & don't sweat the little things - You need to create a lifestyle that you love on your terms & it's OK if that changes over time.
I have some serious free time other than running marathons so please reach out if you want to talk shop!
Happy Investing,
-Jared
2 Reply
Anthony Vicino
Investor · Minneapolis, MN · Member since 2017 · 95 posts · 130 votes
6y
Originally posted by @Shiloh Lundahl:
@Erin Dorsey Robinson

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.

This is an easily overlooked gem of advice, right here.
Modeling the actions of those who've been where you seek to go is a great recipe for success. Actually finding somebody who is where you want to be, and then bringing that person massive value and putting yourself within their sphere of influence is beyond powerful.
Warren Buffet relays the story of when he first met his mentor, Benjamin Graham, and told him he would work for Graham for free.
Graham, rightly understanding the value of the education he would be bestowing on Buffet said, "Even at free you're overpriced."
I mention this, because most people looking for mentors don't really understand the value-exchange dynamic occuring, and they fail to bring true, recognizable value to the table.
If you can figure that out, you're well on your way.
Now, as far as a technical answer to the question at hand, Value-Add Apartment Syndications.

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