Looking to get started in real estate, does age matter?

Question

Hello!

I’m looking to get started with real estate investing. At the moment I am 17 so I’m not quite able to apply for a credit card to start building credit history. I also do not have a W2 job since I’m a student full time.

I would mostly likely end up with a traditional house hack with a 3.5% FHA loan, and I would be able to cover the down payment. .

My question to anyone who started at or close to 18, did you find any legal ramifications? Would banks lend to you or did you require a co-signer on your loan? Would you have any books/articles/podcasts that helped you get started that you recommend?

Thanks

JM Payne · Answer

Speaking 100% honestly, I got started early, but it didn't catch on early.  I started in construction and then moved to commercial RE.  My family is big in REI, and I thought that I would do follow in their footsteps, learning both angles and then building my own business.  I had no specific goals or plan though, and instead stayed in a toxic work environment for the bulk of the great recession, and ultimately left disillusioned and burnt out.  I bounced around for almost a decade, making the poor financial decisions that people make, before ultimately returning to REI through the lens of FI.

I think Your Money or Your Life was especially impactful and is something I wish I could share with my 18 year old self, which has not a ton to do specifically with REI methodologies, but will hopefully give you the power to stay on task and design your life from the beginning.

Regarding your plans, I would ask whether or not your college is paid for, and where your passion is.  If you're on scholarship and/or your parents have college taken care of through 529 or other vehicle, AND if your passion is engineering, then I would say go to school, read FI and REI books as a hobby, and then channel that knowledge post-graduation to build the engineering life you want, whether that's your own company, or simply the ability to choose where you work.

If, on the other hand, your heart isn't in to it and engineering is just a path to potential future wealth, then you'll fare far better with the real estate license.  I wouldn't mingle REI and Contracting right out of the gate.  Pick one, and excel at it first and, again, the RE license is more valuable.

IF your passion is engineering but it's NOT covered, then I would A)spend all my free time applying for every scholarship you can find and B)Spend your first two years at a community college that has a transfer agreement with your intended Alma Mater.

Hope that helps, and best of luck to you!

- jm

Dan Sheeks · Answer

Hey @Evan Ridenour

Congrats to you for your ambition! I work with a bunch of young aspiring real estate investors just like you (in a free online group), 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/

Stephen Brown · Answer

Hello Evan,

I recommend you to get to know your market very well by reaching out to other investors. Make connections and then start calling people asking if they're looking to sell. If you get a deal then you might be able to partner. If not, then there's nothing wrong in saving and then investing. Let me know if you have any questions. I'm just getting started too.

Best,

Stephen

Aaron W. · Answer

@Evan Ridenour Very envious that you have the desire to get into real estate at a young age.

Before you begin, where do you see yourself with real estate? What goals can you set for yourself?

As @JM Payne mentioned, adding you to their credit card could help you start showing credit history. My parents did that way back when I was in high school.

A house hack is a great idea and a way for you to start out in real estate and gain the experience of landlording and being a property manager. If you bring on roommates or tenants, then all the more experience for you.

Lack of financing is an obstacle that can be overcome and should not stop anyone from investing. If you find a great deal, then there is money out there for financing whether through hard money, private money, partnerships, or investors.  It could be private money (parents, grandparents, other family) could be a method to raise funds for your first house hack. However, you'll want to spend time knowing what a great deal is and then looking for that deal. You can then sell this to your potential financers.

Bigger Pockets has a lot of resources to learn about all areas of real estate. If you know someone in the real estate field, such as a real estate agent, property manager, contractor, etc., the you could reach out to them to shadow and learn that way.

Good luck with the journey!

Evan Ridenour · Answer

@JM Payne

That’s an interesting option I hadn’t thought of being added to my parents card. my post high school plans are as of now pursuing an engineering degree but I am seriously considering getting my real estate and contractors Licenses.

Did you have a specific book or resource that you used that was an “aha” moment for you? especially starting from a young persons perspective.

Thanks,

Evan