Where and how did you find your first deal?

7 Replies

Originally posted by @Elizabeth Roncevic :
@Matt K I’ve heard mixed things about finding deals through MLS. How did it work out?

Worked out, depends what you want/ where you're looking. Houses are like cars... it's possible to get a good deal from a listed (MLS/Dealer) it just takes more work. Wholesalers/Off Market stuff most the time is inflated numbers.... and the "deal" is more or less what'd it be at market. The TRUE off market deals, you won't ever see them until you've made solid connections. Not even just networking, we're talking closed ton of deals w/ a realtor/wholesaler. If the deals good enough there's a long list buyers...

@Elizabeth Roncevic

Just saw this.

I suppose "my first deal" is my first rental property in the USA. I had previously been exposed to the profitability by renovating homes in Greece. But here in the USA, for a long time, I pursued other things I saw as business opportunities. So my first real estate deal here was dumped in my lap by my wife. An off-market opportunity came to buy an SFR a friend of hers owned at a good price because he wanted to get rid of it quickly. We thankfully got a home equity loan with a 3.25% interest rate very quickly through our bank and brought 100% of the cash to buy it in the form of a cashier's check at the closing. Not a very sophisticated deal, right? We ran no numbers, and at the time I had read zero books on real estate investing. The old-timers here on BP are not kidding when they say that a monkey could have made money investing in real estate at the right time in the wake of the 2008 housing meltdown.

When I finally realized that my friend had given us a phenomenally good deal in his time of need was when the neighborhood started to rise in value. And it kept on rising. The property has appreciated at least 150% since the end of 2013, when we bought it. The tenant that came with the deal has been at least steady and predictable with the rent. The house is solid, with no nightmarish issues costing us big bucks, or rather, nothing that I couldn't handle myself, with my ever-expanding renovation background, for basically peanuts. I knew this would be an advantage going in, but I didn't understand back then how much of an advantage it was, or rather, how we could maximize this advantage as a mom-and-pop investor team.

Our current plan, given the phenomenal appreciation of the property, is to move into it ourselves at some point and do a live-in flip, then use the cash to buy more rental properties that would offer us more of a return for the cash that's in the place and the gain that we can get out of it. Until then, we'll just keep on making money on it.

I'm in a different situation than @Omar Khan , in a completely different part of the USA. But the pattern still holds: this off-market deal was the result of an existing relationship. @Matt K. makes a relevant point here, too. This was certainly a true off-market deal.

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