How to start out while young?

Question

Hi, I'm a 19-year-old college student, and I've been listening to the podcast for a little while now. I really want to get involved in real estate and my goal is to own rental properties in the future. Are there any steps that I can take now even though I am just 19? I am working and saving what I am making, but obviously, this is not a ton of money and not enough to buy a rental. Should I continue to save? Should I get my real estate license?  Any help would be greatly appreciated!

George W. · Answer

Real estate takes time to have solid growth. Anything where you can make money overnight is generally high risk.

Keep on budgeting and saving money. Work on getting a decent paying w2 job and before you know it you'll be have enough savings to do a FHA loan 3.5% downpayment. Also dont overlook 401k programs and IRAs start saving young you'll be away ahead of the game.

Dan Sheeks · Answer

Hey @Owen Nipoti

Congrats to you for your ambition! I work with a bunch of young aspiring real estate investors just like you, and I am willing to help you out with some advice or even chat on the phone if you wish. But I first recommend you read this article I wrote for Bigger Pockets titled How to Invest in Real Estate Before Turning 21. Once you've read it, let me know your thoughts and if you have any questions. I am a high school teacher in Colorado and I am always looking to help young people get started in real estate investing or help in any way I can. Let me know if you want to chat sometime. https://www.biggerpockets.com/

Owen Nipoti · Answer

Wow!! Lots of great info thanks so much!!!

Josiah Willis · Answer

20 Year old investor here would love to talk! A few months ago I was in the same spot figuring this all out alone but I had a goal at the beginning of the year to save $10K and attempt to buy my first property.  Attempt being the key word there. I have just about hit my savings goal and began looking at anything I could afford (there wasn't much) so I partnered to bring my initial capital investment up to $20K+ So before I get to the "mo money mo problems" portion of this some action steps! Start reaching out to people (just like this! Facebook and LinkedIn are great too! Let me know where you're located and we can find some groups) learn all you can from anyone willing to teach, build up a support system (agents, property managers, contractors etc.) so when you are ready you can dive straight in. If you're in school and doing part time work I would suggest finding a job in real estate or an adjacent market. Find a REI group near you and see who needs work or help. It can be taxing trying to learn and perform at the same time so don't be like me. Spend 19 with expectations of getting a plan and network in place (learn the rules of the game) and begin to execute in a year. You will be far better off than many much older investors. I really started going hard during COVID this year and a few months later we have the funds to potentially purchase a single family rental in Detroit but my goals are lined up with multifamily and scaling quickly so although I've now secured more funding I still have more experiential learning to do. Money really is not the end all be all get around a serious group of guys/gals. It's something I'm still working on and would have spent more time on if I got to go back and plan again. Sorry if this was confusing or not very helpful. As far as licensing goes you don't need one I started getting mine over COVID (Still taking the course) it helps greatly for learning the terminology and how the real estate ecosystem works but comes with certain disclosure and legal requirements if you go for full licensure.  Hit me up anytime seriously there aren't a lot of young guys out here!

Alhagie Kassama · Answer

Hi Owen,

First things first, you're 19 and already have an Investing mindset. Congrats, thats huge.I'll throw in a few pieces of advice, and you can pick and choose which ever one works for you.1).Stay away from debt (especially consumer debt, credit cards,car notes and such). I understand if you have student loans, as that's an Investment towards your future. Not counting a mortgage here as well.2). Start building your credit.3). You mentioned you have started saving: Have you considered putting some of those savings Into the stock market(Index funds). That way your money is working for you while you get through college. I know the market is crazy right now, but it's also a good time to buy some cheap stocks and in the history of the stock market it always trends upwards after a downturn.4).Network and reach out to people in the RE space. You never know what could come out of it. You could gain a mentor or even a partner.5).Have a goal in mind: eg; Do you want to buy your first property right after college, by using the money you saved throughout as a down payment? It gives you something to work towards.Consistency is key no matter how big or small what you're doing is. Best of luck!!

Daniel Haberkost · Answer

Hi Owen,

I bought my first rental when I was 21 while still in college. With a bit of time/effort there is no reason you can't do the same. Real estate investing is best done from a place of financial strength so I recommend learning to budget and increase your savings rate as much as possible. Additionally, try to get rid of all your debts, are you paying for college as you go?

What are you doing for work? How can you increase your income and get yourself to the point of qualifying for a traditional mortgage so you can start with a house hack?

At the same time you should be reading/learning all you can about real estate investing while also attending local meetups.

Dan

David Richter · Answer

Hi @Owen Nipoti,If you want to start as soon as possible, then you need to provide massive value somewhere in the marketplace as quickly as you can. I would find someone who is where you want to be and offer to work with them for free to see what they are doing and to see if they'd be willing to partner with you on big deals after you provide a ton of value to them. This will give you connections and experience very quickly and the opportunity to get to your goals. I would suggest getting the Profit First by Mike Michalowicz. Without any financial literacy, it tells you how to manage the finances of your properties and business.I'd also recommend Gary Keller's The Millionaire Real Estate Investor because of the practical tips offered in the book. Then get started! The best experience will be doing a deal and actually getting your feet wet.

Josiah Willis · Answer

@Dan Sheeks Just read your article/blog post and man it made me upset to think about how much I didn't know just a few short years ago! I wanted to thank you for doing stuff like this. My high school economics teacher is responsible for my initial interest in financial literacy I remember him mentioning he flipped houses and thinking "while that's for much older people at least I know this guy practices what he preaches." That is a class I focused heavily in and asked questions to implement strategies. I learned so much but didn't act until much later. I'm from Michigan but would absolutely love to get on a call or chat sometime! I'm really trying to find more people who's experience I can learn from.

How to start out while young?

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