Hello everyone in the BP community, hope all is well with you all. My name is Eugene Harris and I've been on BP site for a few months now and recently registered as a member about a month or two ago. I created my first forum post and received a lot of feedback and that really made me happy and thankful to know that there are people who are willing to give their advice and input regardless of how successful they are. So again, thank you for all of the replies and warm welcomes everyone has given me. Since then I've continued doing some research on real estate investing and just finished up Brandon Turner's book on Investing in Real Estate with No and Low Money Down. It was a wonderful book and I've learned so many ways on how to be creative and invest in real estate.
Now it's time to go ahead and jump in! I don't want to be that individual who reads ands reads daily about real estate investing but never jump in and try to do it. With that being said, I have came up with a starter plan where I think it's the best starting point for me before moving on to rehabbing and flipping properties. I would like to start with an owner occupied investment property. I want to find and purchase a duplex using a FHA loan and live in it while fixing it up and renting out the other side. With me being only 22 years old with no wife or kids, I feel like this would be a perfect starting point.
The problem/situation I'm dealing with at the moment is the numbers and analyzing the property. I've read a lot and studied a lot to know that this real estate business is not easy and you can make a lot of mistakes if your numbers are not accurate. So I can honestly admit that I'm stuck on the numbers and don't have a system in place at the moment where I could plug in numbers to determine the cash flow I would be receiving. I know the basics such as first looking at the price of property, taxes and insurance, mortgage, monthly income from tenant next door. Are there any other factors I must include? So far, these are the questions I have for myself at the moment:
What factors must you include in your mathematical system?
How to estimate expenses on a rental property?
Best method for finding and analyzing properties?
What makes this is really a good deal?
These were the first four questions I came up with once I decided that I wanted to take the Owner Occupied route. Please feel free to add in some questions I must ask myself and also any advice on what you would do if you were in my shoes. Again, I am a complete newbie to real estate investing as you can see, but I am also a believer and I believe that I will become successful in this business down the road. I love reading about real estate investing and I am determined to become great at it and make it my full time job, with proper guidance I know this dream can come true. Please feel free to contact me at anytime, I'm always interested in discussing real estate investments and opportunities. Thank you all in advance and I apologize for the long post.
Check out BP calculators at www.biggerpockets.com/calc, I'm trying to get going myself but they seem to be pretty detailed. Where in NJ are you? I grew up in Sussex county.
Do yourself a favor. Become a Pro on BP which will give you unlimited access to the B&H and Flip evaluation tools. ( you can try them a limited # of times without being a Pro member ) Get familiar with the tools. Run numbers on lots of properties until you are comfortable with the process.
Thanks Shamus for the reply, I'm located in Monmouth County at the moment.
Thanks Anthony, will definitely look into it and see what it has to offer.
Owner occupy is a great way to go. My wife and I started with SF purchase and are in the process of selling it to move into a MFR. I do not have an exact answer for you on estimating rehab but I will give advice on ways to manage it. First things first try to do as much as you can yourself, labor is the largest expense you will encounter. Start small and build confidence, mess up along the way and fix it. I messed up my tub 3 times till I got it right each time I did not fail I found a way not to do it the next attempt.
Next advice I will give is with your age and your situation you may have a great opportunity to rent rooms in the unit you live in to friends. My wife and I rented one of our rooms out to a friend, his monthly $500 was an awesome deal for him and it financed all of our renovations. Also he was a help with many projects I needed a second hand with.
Best of luck
Plenty of people have gone the rent out a duplex, triplex while living in one of the units yourself route before and done well for themselves. But be careful because if your tenants know you live next door, you can't hide from them. I'm not saying you should hide from your tenants, but there is something to be said for keeping your work and personal lives separate.
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