I’m between focusing on education for a year before my first deal, or finding and diving into a deal from distance and learning as I go.
Hey everyone! I’m new to the BP world and I have really been loving every second of it. Between the podcasts, forums, and BP books I’ve learned so much in just a couple of months.
I’m in a situation right now where I’m likely going to be moving cities next year from North Carolina to Tulsa, Oklahoma where I grew up. I want to get started in real estate as soon as possible, but I don’t know if it’s smart to have my first property be long distance, (looking at Tulsa, not here) but I also understand that a year is a long time and I could have learned a lot from the process in a year and could hit the ground running once I move.
If it were you, would you use the year of time to learn as much as possible, read, study real estate investing books, the forums, listen to podcasts etc, or would you look for your first investment from distance and “build the parachute on the way down” as Brandon Turner would say??
I'm looking into renting SFH and possibly multi family more long term. BRRRR method is what I'm leaning towards, but it would depend on the deal.
Thanks so much for any input!
Hi @Nik Stophel ! Since you asked if it were me... I would take action. If you have the funds, go ahead and start working through the David Greene book Long Distance Real Estate Investing - that book will give you the confidence (if you follow the steps he lays out) to start doing something, either in NC or buying something in Tulsa. You could always go ahead and buy a multi-unit in NC and house hack it. That will get your feet wet. I started last September and now have 4 units, with potential to double that by the end of the year. So a lot can happen in a year if you take action. There are more robust examples here on BP than mine, but each person goes at their own pace. You'll always continue to learn and educate, but your best learning will come from doing. If you don't know the answer, you can always come back here and ask! All the best! - Joe
Thanks Joe! Good advice. I definitely am considering that, and I’ve got that book ready to order! Finishing BT’s book on Rental Properties first! It’s great! I guess I was more concerned with the possibility of having to rehab from distance.
I’d love to house hack for a bit, but unfortunately I’m in a year lease in an apt right now and I don’t really see a way out yet. That’s been my biggest issue because I didn’t realize how hooked I’d get and now I wish I never rented in the first place!
Got it. Focus on the contractor piece, find a good one, call the references, ensure to put a penalty and bonus in the contract. Interview a minimum of 5, seriously. This isn't a part to shortchange, very important. I didn't and got burned bad on my first one.
Maybe an option to consider is when you run the numbers on a deal - include the penalty you'd have for breaking your lease early. Go talk to the leasing agent and ask what that penalty would be. Thr profit and cash flow you may make from your investment may offset the early termination penalty and help you get started faster.
@Nik Stophel it's hard to answer without knowing your full financial situation. If you have the money for a down payment and reserves, then I would go ahead and take action. You definitely want to be in a strong financial position when you take action, but as long as you have that piece down I would say you are ready to go!
Rehabbing from a distance can be tricky, but if you get in with a good property manager they will generally have contractor contacts. I would try to get a property now that's closer to turn-key if possible. Then you can take on the bigger rehabs once you are local.
@Nik Stophel agree that it depends on your financial situation, but you don’t have to lock yourself into one path. Plan to work on your education, build your network, and set yourself up for success. At the same time, if finances allow, do some research in the area you might be interested in. If you find a good deal, put in an offer. If you don’t, then don’t.
That’s just one option.
Or go all in, that’s also an option :)
@Nik Stophel I was asking myself this question for the last year or so, minus the long distance. I live in the Tulsa area and have been wanting to invest, but felt like I needed to keep educating myself before starting. That included everything BP has to offer and getting my real estate license to start a career as an agent.
I finally pulled the trigger and am closing this week on what will be my first flip. Even though the work has hardly even started, I can already say it has been an accelerated learning process compared to anything you’ll read or listen to. So assuming you are in a good financial position to make the investment, I say absolutely go for it. As long as you buy right and have multiple exit strategies, I see it as the only way to learn that’s going to pay you!
If you need help with anything, let me know! Like I said I work the Tulsa area and don’t mind doing some legwork for you if it helps you get started.
@Nik Stophel almost certainly you should jump in! You will learn way more that way.
You don't have to buy a property that needs a lot of work.... Why not look for something that is rent ready?