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).
If you really want to get started with little or absolutely no money, I'd go the HML way. Have the HML finance the whole thing, take the higher interests and the points but in return gain knowledge and experience. Knowledge and experience is what your business will need to grow.
@Omar Diaz Thanks for the input. It seems the general consensus is that I should jump into investing and start gaining real experience. With the HML, what are "points"? I understand the interest is interest rate but don't know what "points" are.
Yeah man of course. Taking action is key. Points are charged by HMLs and are typically 1% of the loan amount. So 6 points would be 6% of loan amount. HMLs have their own guidelines.
Hello Daniel! Do whatever you wnnt to do that you feel you want to do. Read books that increse your in that area.
On that said, there varius generl books in general thins you can study and learn. Your coñfidence will grow as you learn.
There's also a financial education can give you the stuff you learn to help gain good knowledge will help you in almost all niches. I have learned about many about general tactics and that material
can't go over that you can't learn about everything you cannot do It all you but least more than others will learn. Know local laws and building codes that will help you. Start looking and getting that experience that will help you.
Beware of the internet and do not make emotional redecisions. Sleep on it.
I am interested in creating a portfolio in real estate investing, and this is by one of the greatest ideas I've scrolled upon. This will be one of my first steps to beginning my real estate career. Thank you so much for the input.
@Ben Feder not sure how to answer that except with NOW, !! Sooner then later , why procrastinate? It does not mean you need to invest 100k, or even 10k, connect with someone actually doing deals vs reading books or going to BS guru seminars ( I have never done either ) . Learn then apply what you learned. Find deals, flip them to investors, they will pay you, Save, learn and do on your own.
Being our of your comfort zone can be a good thing
Two things that I can pretty much guarantee will make the ball rolling. @Ben Feder.
1- Go to a Local BP Meeting or If you don't have one, create one. (you will start to see more synergy)
2- Work For an investment firm, Brokerage, Shadow and investor (offer to help him do all the errands he needs in your free time or Work for a well established wholesaling firm.
" The best way to predict the future is to create it" - Peter Drucker
Hi Ben. The answer to your question is now. "No time like the present " applies here. I began in 2017 purchasing a 3-unit with someone else's money. That being said, I am capable of extensive remodeling work. If you are not very handy or are far from your purchase you'll have to have other means set up for the inevitable. Also, getting the money to purchase is easy, but you need reserves in a worst case scenario. I've since purchased 2 more properties and still have not used my own money except for rehabbing or repairs. So essentially I have an infinite ROI. But always have an open mind and never stop absorbing knowledge! You've done the right thing by asking! Good luck to you and keep BP close by!
@Ben Feder I am no expert on Real Estate but I have talked to a lot of experienced investors in person and they all tell me the same thing: JUST DO IT ! Just take action, as you go ask the questions you may have on the way and keep moving on ! I hope this helps ! Have a great day.
I would make sure to analyse at least 1 property every day and once you feel confident in that you should be able to jump right in as you have been educating yourself for quite some time.
At some point, you do have to dive in and get that first property. There a lot that you just will not learn until you start doing.
At the same time, if you aren't as prepared as possible before you buy, that first house is likely to be your last, and a very bad experience.
I think it's very important that you get out and talk to some actual people before you make a move. Print some cards, go to meetups, and get good at walking up to people and saying, "Hi, I'm Ben. I'm making a start in real estate. Can you tell me a little bit about what you do?"
For whatever reason, a lot of people in this business seem willing to spend time sitting down with noobs and answering questions. Maybe some kind of mentoring can come of it, especially if you have some service you can offer in return.
But be careful and skeptical. Most people out there, and many on here, will be selling you something.
And don't be too hasty. A lot of smart people think the market is peaking right about now. The deals that were everywhere three years ago, are very scarce these days. We are looking at hundreds of houses to find one that we want. To succeed in REI, you have to have some sort of edge at every step of the way, and that starts with the purchase. If you buy at the level we're at right now, and pay retail, you are off to a very bad start.
@Ben Feder attend some of @Brandon Turner’s weekly webinars for analyzing properties, listen to every episode of the podcast and I think you’ll be able to answer that question better for yourself
Although some people on this forum may disagree, I like the idea of house hacking into a condo first. By living there, you can put less money down with a better interest rate. Plus, condos are generally easier to manage, giving you a nice transition from renting into home ownership. This is because you don't have to do things such as worry about the roof, sewer line, etc. You can generally focus on walls in (every complex is different). Especially if you are living in an apartment anyways, your lifestyle won't change much, other than building equity.
@Rick Albert people are generally biased against condos on BP, unnecessarily. I've been investing in apartment complexes for a few years now, but I'm also in the midst of a condo house hack right now. There's no reason you can't do two things at once - buy big multifamily and make a nice return on your primary residence!
Although some people on this forum may disagree, I like the idea of house hacking into a condo first. By living there, you can put less money down with a better interest rate. Plus, condos are generally easier to manage, giving you a nice transition from renting into home ownership. This is because you don't have to do things such as worry about the roof, sewer line, etc. You can generally focus on walls in (every complex is different). Especially if you are living in an apartment anyways, your lifestyle won't change much, other than building equity.
How do you invest in condos? Do you mean the whole building then rent out the condos or do you mean by individual condos and then rent out the rooms inside them? I am not sure what you mean by house hacking a condo or investing in condos in general.