Hi All! I am looking to invest in my first investment property but currently don't have a ton of capital. I want to find a way to get started now because as they say on the BP Podcast often, the most difficult, scary purchase is often the first one. I want to get over the hump of the first purchase and continue to build out my portfolio as soon as possible with the goal of one day owning hundreds, heck, thousands of units that provide steady cash flow to work towards building generational wealth. I want this to turn into my full time career!
But again, I've got to start somewhere.
Being transparent, I have about $25-30k to put down on a property. It's not a ton, and so I'm wondering how limited that will make my options? With this money does it make the most sense to make my first investment a flip? A BRRRR? Am I "SOL" in terms of duplexes and multi-families with the kind of down payment I can afford right now?
Appreciate your wisdom!
@Tommy Dahlborg Hi Tommy, I am new to real estate investing as well and had the same "SOL" feeling being from Boston and looking to invest in the Boston area with some of the highest prices in the country. If you have not already, I would recommend the book "Invest In Real Estate With No (and low) Money Down" written by Brandon Turner from Bigger Pockets. Its a quick read and opened my eyes to some financing options I am now exploring on my first deal. I am now looking at using a 203k loan to purchase a property that needs some rehabbing.
@Joseph Lavoie appreciate the book suggestion man, and it’s nice to know I’m not alone in this position! Glad you’re getting after it right now 💪
If you don't have any high interest debt and have a solid credit score then I would look at house-hacking. It's the cheapest way to get started in real estate and has the added benefit of reducing your housing (most peoples largest expense).
Im in an Options Trading Mastermind group.. The consensus is get a job and save up like a MADMAN.
@Cameron Tope Thanks for taking the time to provide your feedback man! Yeah, house hacking definitely seems like a solid strategy to start with. Good news is, I do not have any high interest debt and have a solid credit score! Appreciate your input.
@Dan Weber can you help?
Thanks @Lien Vuong ! A little capital can go a long way when trying to break into the market with house hacking on a low-downpayment owner-occupied loan! Tons of opportunity in this area to get started on your investment journey.
@Tommy Dahlborg That is great you want to get into real estate!
Financing is an obstacle that can be overcome if you can find great deals whether through hard money, private money, investors, or partners. There are also creative financing options including seller financing, etc.
Before getting started, know your why in investing. What goals do you need to accomplish your why? Are you looking for cash flow or appreciation? Do you need cash flow now? How much rehab are you willing to take on?
Practice deal analysis now. This is an invaluable skill every investor needs. This can help you develop your own investment criteria and recognize bad, good, and great deals.
It might be a great option to partner with someone who has more experience to guide you through an investment. Look at what are your strengths and weaknesses and look for someone who has complimentary skills than you.
@AJ H. Appreciate you AJ! This is some good feedback. I love that you brought up the question of “what is my why”. While cash flow would be super nice, my current “why” is to get into a position where I don’t have a mortgage/rent payment to help limit my expenses, therefore helping me to invest in more properties in the future to support myself and my family, and pay off my student loans faster.
I have begun thinking about who I could possibly partner with in my first investment and think that would be a really wise route to learn more from someone who already knows a thing or two about REI.
Thank you again for your feedback!