I am 21 years old heading into my last semester of college (thank god). Already interviewing for full time sales and account management positions, but I have always had a calling for developing real estate properties. I’ve spent roughly 4 years working in construction and working for landlords/house flippers. I have a decent bit of know-how for carpentry, framing, and home repairs. I have a lot of connections in electrician fields, flooring, roofing, and general contracting. I also have a great connections for mentors in flipping and renting, but what I lack heavily is money. I am truly a broke college student. My credit is less than impressive but I plan on boosting it susbstantially over the next two years.
My questions really fall into what strategies are my best bet at getting started? Even as a business economics student, my experience with loans and credit is pretty minimal and I figure I’ll have to talk to a lot of banks to find someone that will loan to me. I have very minimal cash for down payment, so would it be wise to just focus on working and saving money before even thinking of finding a property? Is it better to start with a potential flip or should I aim to find a rental? I am in Upstate NY so I know there are plenty of opportunities to buy and fix, but what sort of price range should I be looking for? Does it seem sketchy to a buyer if I buy and fix myself with my connections? Does it give peace of mind to have a contractors name attached to the property? Also open to suggestions for locations with growing markets. Could also use some information from someone with experience in buying properties from auctions and how to be successful in doing so? Can you only use cash for auctions?
please answer any or as many of my questions as you can. Thank you very much.
@Skyler Rebeor repairing/improving your credit should be the goal as you finish up school. Review your report, have any errors corrected, establish a budget and pay down balances.
With your skills and connections you have many paths available. Many of us got our start by owner occupying a 2-4 unit. There are grant programs available for low to moderate income earners who are 1st time home buyers in upstate. There are low down payment mortgage options that allow for seller concessions towards closing costs. The two of these tools together can be homeownership very obtainable.
My recommended path for you would look as follows: Repair credit/gradate from college/get a job/apply for homeownership grants/get pre qualified by a lender/ purchase and occupy a 2-4 unit residential building.
@Skyler Rebeor auctions are hard to break into for new investors given they are usually cash and quick close. I think you need to try to ask yourself more questions to figure out what strategy is right for you.
How much capital do you have available to invest?
Are you able to get a bank loan?
Do you have potential private lending relationships?
Do you value being in close proximity to a potential investment property?
Do you like the idea of short term deals that carry high yield but high risk?
Do you like the idea of steady cash flow from rentals?
Do you have a property manager available to you or would you manage properties yourself?
Lastly, where are you located in upstate NY?
@Skyler Rebeor If you already have relationships with mentors I would recommend leveraging those relationships. You may not have much cash on hand but that doesn't mean you have nothing to offer. If you have the time and not the money, try setting up a deal where someone else puts up the money and you do all of the work. At the end of the project you split profits!