Investor · Philadelphia, PA · Member since 2015 · 172 posts · 58 votes
I am new to investing and have done some self-educating over the past few years by reading books, forums, blogs, and listening to podcasts and webinars. I still feel like I could learn a lot more: I feel like I generally know what to do but lack understanding of how to do it/not sure I remember all the steps. Should I just start diving in and learn as I go or should I wait and learn more? I would like a mentor but have yet to find one and wonder if I should start anyway because at least then I'd be doing deals. What would you do in my noob position?
Hey Ben, what’s your financial situation like? Are you able to qualify for a loan? If you can start with something simple like house-hacking that gives you a clear goal.
There are a multitude of ways to build wealth through RE so you can’t expect to learn everything about all of them before getting started.
What you need to do is decide what your long-term goal is (why do you want to invest in RE?), then look at your financial situation and determine what avenue of investing makes the most sense.
If you find that something like house-hacking is the most logical first step then you know exactly what you need to learn before starting (how to screen tenants, what areas are in the path of progress, etc).
Hey Ben, what’s your financial situation like? Are you able to qualify for a loan? If you can start with something simple like house-hacking that gives you a clear goal.
There are a multitude of ways to build wealth through RE so you can’t expect to learn everything about all of them before getting started.
What you need to do is decide what your long-term goal is (why do you want to invest in RE?), then look at your financial situation and determine what avenue of investing makes the most sense.
If you find that something like house-hacking is the most logical first step then you know exactly what you need to learn before starting (how to screen tenants, what areas are in the path of progress, etc).
@Ben Feder how many properties have you analysed? Your calculator will be your best friend. How many properties have you walked in your area. Minimum of 50. Once you think you have a deal post your analysis on BP. Rehab is the hardest to estimate, so if you go that route you will need to find a contractor to walk the property with you. You will need to pay him for his time until you buy a property.
@Daniel Haberkost also I know I want to invest in BRRRR multi-family and apartments. I still don't know how to find the right properties without an agent.
@Tim Herman I have no money to invest, even in expenses such as contractors, accountants, or lawyers. I have not analyzed any properties but don't even know how to find them at the right price or compare to comps.
Okay, so sounds like you need to learn a bit more about valuations and analyzing rentals. BP
had numerous podcasts, articles, and webinars about this.
If you don’t have money and need a partner, you’re going to need to bring value by doing the leg work and finding deals. What have you learned about finding deals so far?
You will also need to meet other investors with money, have you been attending any local meetups?
Thanks. I need to find local clubs/meetups to attend. Yes I think I certainly need to learn more about valuations and analyzing deals relative to local markets. How does somebody compare to comps? I know you are supposed to look at similar properties that have sold within the last 30 days or six months or something, but how do you determine what is similar? All properties seem to either have different square footage or different features, so it is hard to find what is comparable.
We just started this year and I fight the urge for analysis paralysis (I'm an engineer by training). So I just jumped in, I would say find local investors in your area reach out to them on Bigger Pockets. I have met nothing less than great people here willing to help. Everybody had to start somewhere.
@Ben Feder It doesn't cost a penny to run analysis. Go to Zillow and pick a property. You are a pro member use the BP calculators. Go to the nearest meetup and talk with other investors. There are at least 10 groups in Phily.
@Ben Feder Don't have any experience in Phily but I could analyse a property in Phily from ND. The key is trying to determine what zip codes are best to invest. You can use the search function and I could probably even find the up and coming neighbor hoods in Phily without leaving my living room.
Learn and study the markets you want to be in while doing what it takes to save up money for your downpayment plus some reserves. For your first one, you should go on your own, build a small portfolio for yourself first this way you get the learning experience and when you're ready to syndicate some deals, partners will take yous seriously because you have skin in the game. We all start somewhere my friend. I can help you analyze some properties once you figure out exactly where you want to Invest. PM me anytime
@Tim Herman sounds like you know what you're doing! I'd love to be able to analyze like you do. Could you tell me what the steps for analysis are and on which sites? I am lost as to determine the value, finding comps, and determining the right market/neighborhood to invest in.
@Junior Soares I certainly will connect with you I just sent you a connection request. What is your method of analysis? It would be good to get your opinion, not to mention I am awed by your contractor experience.
@Ben Feder One thing you can do is start looking at properties that you are thinking of buying.
And to answer your question: make sure you follow a process that increases your probability of success, so that way you know when you can start investing.
@ben feder a Realtor should Give you the market price for that home in that condition. If it needs repair then they should also tell you the ARV, after repair value as well.
@ben feder a Realtor should Give you the market price for that home in that condition. If it needs repair then they should also tell you the ARV, after repair value as well.
That's exciting to know! And makes me feel more comfortable with the investing process. Do you know if Realtors in general are able to do this or only the good ones who know the market and what properties and features are worth really well?
No experience and no money? Then I'd say the answer to your question is no. You can't get started in the way you mean. You say you want to partner with someone. What are your bringing to the deal? Good looks only go so far. However, you do have time. You can continue to educate yourself. Read. Listen to podcasts. Join an area REIA or two and go to events to meet others. Network. Get a job in the RE industry. There are lots of ways to get involved. Lots of sides to see. To explore. Sales. Construction. Development. Property Management. Specialized trades (plumbing, electrical, solar, drywall, painting, roofing/siding). Insurance. Finance. Analysis. Find an area of interest and seek out a job where you'll get paid to learn while you work. Then save. Live on as little as possible. Keep running numbers. Save some more for that first investment. Househack if you can. Learn. There will be hiccups along the way. But you can work through them. Continue to save. Prepare for surprises and down times. Vacancies. Bad tenants. Repairs. Emergencies. Prepare to second guess yourself and to lose sleep. It's a guarantee. Prepare for naysayers. One day you'll wake up and you'll be doing it or you'll be doing something else.
@Daimian Leslie I totally agree , at some point you just have to jump in . Take the time to educate yourself and have a clear idea of your plan and what strategy you want to follow to get started but at some point you are going to just have to dive in :)
@Ben Feder I would say start yesterday! What does your financial situation look like? What type of investing are you trying to do? I’d be happy to answer any questions I could for you about rentals and how to stack up a portfolio of small multi family units without a lot of your own money. If you are looking for advise on Wholesaling or Flipping then I’m probably not your guy. Good luck!
@Robert Nelson People are always willing to share where they are buying property. I would put Phily in the search function of BP. Read through the messages and you will get an idea or where to narrow your search. Won't be foolproof because streets can be good on one block and bad on another. That is where boots on the ground take over. That's why you need to have viewed at least 50 houses in your target neighbor hoods.
@Ben Feder The cheapest price of admission for investing is house hacking. Buy a small multi 2-4 units. FHA will allow you to put 3.5%, certain areas have programs for zero down. You live in it for a year and move out to another multi and get an owner occupied loan of 5% or less. Move 10 times in 10 years you can accumulate 20-40 cash flowing units.