Advice for a total novice?

Real Estate Agent · Member since 2019 · 3 posts · 2 votes

6y

Step one is to decide what your criteria is. The resources under Tools here is excellent. Are you looking to maximize cash flow, are you looking for long term appreciation with less cash flow, or a combination? You have to decide your criteria first before you go looking for properties.

Research Property Management tools to track expenses and income for taxes. There are lots of good free ones online.

Get a good accountant you understands investment properties. Not all of them do.

Develop your network of lenders and repair people such has plumbers, HVAC, electricians, and roofers.

Have some emergency cash on hand for unexpected issues.

Most importantly, like Josh says, have patience. This is a get rich slow strategy, but stick with it and be consistent.

Good Luck!!!

1 Reply

Noah Chappell

Investor · Minneapolis, MN · Member since 2016 · 254 posts · 228 votes

6y

@Josh Bugbee not to reiterate what's been said, I'd add a few points to summarize.

First, forget the "go big or go home", we tend to hear about these ppl who've done a 100 unit syndication their 1st deal, thats extraordinarily uncommon, the reason you hear about that is because its such an anamely, & you're not given the back story of their 10 prior years of high level corporate management, etc. "Easy come easy go" would be more correct, so to build a portfolio that provides you financial independence, I'd say take 5, 7,10 years & build something sustainable that you can get your mind around.

If you're serious at all, BUDGETING COMES FIRST. Unless you're a very high earner, I'd aim to save not 20%, but 50-75% of your income to dedicate towards RE. Its easy to picture the glory of a huge passive income, but grinding though months of frugality will give you a small window into the sacrifices required to make RE work.

If you can dedicate yourself to the grind per above, you can scale relatively quickly. I'd start with a house hack duplex for 3.5% down - I'd recommend you look at some off market deals sources so you can get an amazing deal that cash flows after you move out, & can cover the mortgage if 2nd unit becomes vacant or tenant stops paying. Then I'd save up for a 20% DP for a 2nd duplex from the 50-75% you're budgeting. There, in your 1st year you'll have 4 units & will be on your way. You can repeat this & use Brandon's "the stack" idea to increase your rate of acquisition year after year. In 5-7 you'll have 20-30 units and be well on your way.

I'd start all this by literally reading EVERYTHING you can. What to read? I'd recommend you start with Brandon's 3 books - rental property investing, investing in real estate with no and low money down, & managing rental properties. If you internalize those 3, you'll have a strong foundation to get started.

Good luck and have faith in the grind.

1 Reply

Taylor L.

Rental Property Investor · RVA · Member since 2016 · 5k+ posts · 4k+ votes

6y

Originally posted by @Noah Chappell:

@Josh Bugbee not to reiterate what's been said, I'd add a few points to summarize.

First, forget the "go big or go home", we tend to hear about these ppl who've done a 100 unit syndication their 1st deal, thats extraordinarily uncommon, the reason you hear about that is because its such an anamely, & you're not given the back story of their 10 prior years of high level corporate management, etc. "Easy come easy go" would be more correct, so to build a portfolio that provides you financial independence, I'd say take 5, 7,10 years & build something sustainable that you can get your mind around.

If you're serious at all, BUDGETING COMES FIRST. Unless you're a very high earner, I'd aim to save not 20%, but 50-75% of your income to dedicate towards RE. Its easy to picture the glory of a huge passive income, but grinding though months of frugality will give you a small window into the sacrifices required to make RE work.

If you can dedicate yourself to the grind per above, you can scale relatively quickly. I'd start with a house hack duplex for 3.5% down - I'd recommend you look at some off market deals sources so you can get an amazing deal that cash flows after you move out, & can cover the mortgage if 2nd unit becomes vacant or tenant stops paying. Then I'd save up for a 20% DP for a 2nd duplex from the 50-75% you're budgeting. There, in your 1st year you'll have 4 units & will be on your way. You can repeat this & use Brandon's "the stack" idea to increase your rate of acquisition year after year. In 5-7 you'll have 20-30 units and be well on your way.

I'd start all this by literally reading EVERYTHING you can. What to read? I'd recommend you start with Brandon's 3 books - rental property investing, investing in real estate with no and low money down, & managing rental properties. If you internalize those 3, you'll have a strong foundation to get started.

Good luck and have faith in the grind.

This is good advice. The back story behind the folks whose first deal was a syndication is never that they started looking on May 1 and got a smoking hot deal under contract in June. There are exceptionally few overnight successes in this business, it takes a long time to build. Start with deals you can do, go for base hits, and build.

1 Reply

Aigo Pyles

Flipper/Rehabber · Memphis, TN · Member since 2020 · 758 posts · 285 votes

6y

@Josh Bugbee Welcome to BP. I'm also quite new here in BP. I'm a turnkey provider from Memphis, TN.

My advice is make your credit score good.

1 Reply

John LyszczykPro Member

Rental Property Investor · Marine City, MI · Member since 2016 · 145 posts · 230 votes

6y

@Josh Bugbee

Invest in educating yourself before you jump in.

Don’t do any deals with your girlfriend lol

Read “Rich Dad Poor Dad”

Soak in knowledge from BP

Reduce expenses and become a minimalist.

Save, save, save

You’ll be in the game soon enough!

1 Reply

Jake AndronicoBusiness Member

Realtor · Reno, NV · Member since 2019 · 1k+ posts · 938 votes

2y

@Josh Bugbee

I know this post is old, but curious to hear how it played out for you.

I hope you were able to get into a small multifamily or single family property!!

415-233-1796

0 Reply

Charles Carillo

Rental Property Investor · North Palm Beach, FL · Member since 2018 · 2k+ posts · 1k+ votes

2y

Quote from @Josh Bugbee:

My name is Josh Bugbee, and I am 25 years old. I was born in Iowa but raised in Minnesota. I work in fabrication currently, but I have recently discovered that I have a huge passion for Real Estate. I have very little capital and no experience or knowledge behind me, but I have this incredible fire and energy to act on this newfound passion and get into it as quickly as I can.

I have recently been trying to do as much as I can to dive into learning as much as I can, and have been binge listening to the BiggerPockets podcast. I’ve also reached out to people I know personally to gain their knowledge or experience. Since I’ve been listening to the show I figured I would join the BiggerPockets community to try and get in touch with some like minded individuals, connect with, and learn as much as I possibly can from this community and those in it.

So with all that said, what are some pointers, tips, advice, on any and everything having to do with getting into real estate as someone in my position? I feel all I can do right now is save money and continue to learn. I hear about some aggressive funding strategies, but wonder if I have the ability to take these routes due to my lack of knowledge, experience, and reputation.

My girlfriend and I were thinking at first of starting with a duplex, triplex, or fourplex, and continuing to buy those in succession. I start thinking of starting with a multi unit, house-hack, and scaling up in units immediately on the second deal to grow. Yet, I’ve been wondering how feasible starting with a larger multi family complex would be, am I dreaming too big?

I hate to make such a long post that’s so all over the place, but I am just looking for any and all advice or knowledge that anyone can give me on any aspect of real estate investing.

Thank you for reading, have a nice day!

-Josh

If you are interested in multifamily investing, DM ME. We have a free 3-month multifamily training program for new investors.

0 Reply

Advice for a total novice?

Advice for a total novice?

Most Popular Reply

57 Replies