Can I start in real estate by building a duplex/complex?

2 Replies

I am new to Bigger Pockets and am wanting to get started in investing in rental properties. I thought that with bad credit (bad financial decisions from my past) and little money I would not be able to get into it but I am listening to the book "How To Invest In Real Estate" and it is motivating me to want to try. (My goal is to obtain enough passive income to be able to help/work for a ministry that I am passionate about and also live comfortably) 

Just looking around at the market, since my lease is due in 3 months, I am interested in the idea of owning a duplex and renting out the other half to reduce my housing costs. The problem is I can't find any good opportunities for something like this in Albuquerque NM where I live. I would like it to be a somewhat reasonable location to where I work. 

I am wondering if it is possible to start out by creating the opportunity? I don't even know if I can get a loan to do all this in the first place but is it possibly rewarding to get a loan to buy some land (on the outskirts of the city where they are expanding) and have a duplex built? Or do you guys recommend to start out by buying already existing rental property? 

@Curtis Sleme

Could you start off with a new construction? Possibly, but that does not necessarily mean it's the best way to go. If you have never owned any real estate, have never gone through the process of obtaining a mortgage, nor overseen a project of a similar scope then you might be trying to do too much too quickly. If your credit situation has improved I would start with getting preapproved with a local credit union for a mortgage. Your best bet might be to find a 2-4 unit that needs some work that you can move into and get some experience that way. If you are still working on the credit, consider wholesaling or flipping to gain some experience. Consider joining the local REI Facebook groups and start attending meetups, wish you luck.

Originally posted by @Curtis Sleme :


Just looking around at the market, since my lease is due in 3 months, I am interested in the idea of owning a duplex and renting out the other half to reduce my housing costs. The problem is I can't find any good opportunities for something like this in Albuquerque NM where I live. I would like it to be a somewhat reasonable location to where I work. 

I am wondering if it is possible to start out by creating the opportunity? I don't even know if I can get a loan to do all this in the first place but is it possibly rewarding to get a loan to buy some land (on the outskirts of the city where they are expanding) and have a duplex built? Or do you guys recommend to start out by buying already existing rental property? 

Hey Curtis,

I started investing in real estate in 2008.  I've been a real estate broker in ABQ since 2012 which opened a lot of doors for us.  Sounds like good timing as the market was crashing around us right?  The reality is that I was a mortgage broker and lost everything including my own house and landed in bankruptcy in early 2009.  Over the last decade, I had no money and terrible credit to recover from.  Yet, with the right attitude and mindset, I found some partners to fund our deals.  

Today, I am working on my first large apartment complex deal that I never thought was possible.  You ask if it's possible.  The answer is yes.  

Start by marketing to off market sellers that you are trying to buy a place.  Learn about seller financing and negotiate with the seller to be your bank.  You don't need good credit, just a little cash to put down (not all deals need a lot of upfront cash).  Real estate is great when you're able to find a seller who will work with you to structure the deal that works for everyone involved.  You may just be amazed at what you can accomplish with some creativity.