Advice for getting your first rental property ?

Question

I am looking into buying my first rental property and I’m honestly a little scare. Do you have any tips for newbies like me?

Jonathan Oh · Answer

@Jesus Fregoso Know the market before you invest. And it's not ALL about cashflow. Cashflow is the lifeblood of your investment. But don't make the mistake of buying the highest cash-flowing property you can find. These tend to have a trade-off with appreciation because they're typically in less desirable areas. Also, emphasize on building a great team. Without one, you'll have a much tougher time succeeding. Hope this helps!

Antonio Cucciniello · Answer

I was also scared to buy my first investment property. There's a few things you can do to reduce that feeling of being scared and feel more confident.

1. Pick one strategy and stick to it: Most beginners bounce from idea to idea, strategy to strategy. If you stick with one, and master how it works, you can pick it up and feel confident about your knowledge in that strategy.

2. Choose a location based on data: Most beginners I have spoken to pick a location based on anecdotal evidence.They base it off emotions..."I feel San Antonio is the best place to invest." That's just a feeling. Not based on anything. Collect data for each city, so you know which one is the best for you, your goals and your strategy

3. Get Financing in Check: Make sure to get a pre-approval letter, or speak to your lender to see what you need to do to get funding for your next property. Without a pre-approval you are probably wasting your time and your agents time, so make sure to get this. If you have a partner working with you, get them to get one.

4. Analyze Deals: Master the formulas, practice analyzing 100 deals so you can learn what is the most important thing for you to do. This is one of the biggest things to help your confidence. Your ability to be so confident in the numbers that you are willing to go out and do the next thing:

5. Make offers: Now you are ready to make offers on a property and get one.

If you got any questions, shoot.

Catherine Emert · Answer

RESEARCH everything! being a landlord is serious business. Read every law there is in your area and make sure you fully understand them. Then research your area, research market rents, market sales prices, etc. Find a realtor your trust, a lender, a handyman, etc. have everything lined up BEFORE you buy.

Jesus Fregoso · Answer

@Brian Gerlach

If you know anyone willing to teach a newbie like me can you get me in contact with them?

Jesus Fregoso · Answer

@Brian Gerlach

I have been looking for a mentor but I can’t find one and I have asked my friends and parents if they know someone but they don’t. So I’m going to look up REÍA groups on Facebook.

Brian G. · Answer

@Jesus Fregoso find a mentor who is already successful at what you want to do and learn from him/her. This person is likely to be found at a local REIA or by asking everyone you know in your circle of influence if they know someone who is successful in REI and providing an intro to connect you.  (ask family, friends, neighbors, coworkers, church attenders, etc.).

Antonio Cucciniello · Answer

I use 1 percent rule first than 50% then cash flow analysis

Jesus Fregoso · Answer

@Antonio Cucciniello

Thank you for the advice it was a big help. I have another question when you are using the formulas do you use the 2 percent rule or the 50 percent rule?

Ryan Howell · Answer

@Antonio Cucciniello's advice is spot on.  You should do your research and know your market, but don't think that the fear is going to subside when you're ready to buy.  You will never be 100% comfortable because it is still a new experience.  If you wait for that feeling of comfort you will get stuck in analysis paralysis and never move forward.

Jesus Fregoso · Answer

@Jonathan Oh

Thank you so much that helped me a lot

Advice for getting your first rental property ?

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