How to get started in real estate

Question

Hello everyone! I want to get started buying properties in the Essex county NJ area to build wealth for my family. I have close to $10,000 saved up. Can anyone give me some advice on how to get started. I have read a lot of books on real estate and now i'am stuck in place. So please help with some advice on where to start.

As-Shakoor Wright · Answer

Thanks for the info! I truly love how bp has this platform! And once again thanks!

Greg De Sciscio · Answer

Welcome to BiggerPockets, and congrats on saving 10k!

I recommend you start to narrow your focus and define your target. Are you looking to buy and hold? Flip? Will you start with condos, multi-family, etc?

While you are thinking about your strategy, search for local real estate meetups in the area. Attending those meetups can be a quick way to develop relationships. Put yourself around people who are doing what you want to do. You definitely want to start looking for an investor-friendly realtor, and you probably should speak to a lender in the area who can help you determine what you can afford. Best of luck!

Rodney Harris · Answer

Hey man first off congrats on saving that 10k! That’s huge! I don’t know how the market is an Essex but a good play that you might like would be to owner occupy a 2-4 unit property.

However, I suggest you have double the down payment as far as cash is concerned. If the down payment is 10k you probably want to have close to 20k especially for 3-4 unit properties they want to see mortgage reserves for a few months I believe.

I paid $10,000 for my fourplex with an FHA loan at 3.5% down. I had close to 20k saved up. So that’s just my suggestion. The more units you get the more protection. You also have more things to fix so there are pros and cons. However I will say, It’s nice with my wife in med school not come out of pocket for our mortgage every month! The tenants do that! Lol

Best of luck to you man! Don’t get bogged down with too much advice and just stick to one strategy!

Jonathan Greene · Answer

@As-Shakoor Wright you are off to a good start, but you will need more money to buy a multi in Essex County. If you've saved 10k, that's awesome, but that will just be your repair fund. Have you been prequalified? You need a downpayment (say 3.5%) an closing costs (3%) and multifamilies in Essex Co are all selling for over value. You can find deals in some parts of Newark, Orange, and East Orange, but you will need more down to close these deals. Keep saving and slowly watch the market to see what you qualify for and what that number looks like in real life. If you qualify at 200k, the properties are not going to be first-timer ready most of the time, depending on the size.

As-Shakoor Wright · Answer

Thank for the input. I have already read that book and that is a great book!

Jonathan Curcio · Answer

OP-Study up on everything in here and read the millionare real estate investor.

https://smile.amazon.com/Millionaire-Real-Estate-Investor/dp/0071446370/ref=sr_1_3?keywords=millionaire+real+estate+investor&qid=1576679832&sr=8-3

Ronan Donnelly · Answer

@Greg De Sciscio - congratulations on starting down the path of real estate investing, and most importantly for narrowing your focus on one specific area. You have clearly demonstrated discipline to save $10k and this is where many others falter. One option for you would be to partner with someone on a deal since it would give you a chance to deploy your capital, but it would also allow you to gain some hands on experience with ideally, a more experienced investor. You can likely find potential partners on BP and via local REI meetup's. Good luck! Ronan

Taylor L. · Answer

With $10k to invest in multifamily, you're in the range of owner-occupied duplexes or perhaps triplexes and quads. There are low downpayment loans available for owner occupants which you can look into. Larger commercial multifamily is a pretty pricey game, you'll need to build up more reserves and/or bring in investors to take down larger properties.

How to get started in real estate

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