Hollidaysburg, PA · Member since 2015 · 327 posts · 350 votes
7y
@Jose Huijon, Do some basic research, to include the exact question you have. Many people ask this question with more and less money. Hit the search icon, and type in your question. You'll save yourself and others a lot of time. Good luck!
Rental Property Investor · New York City · Member since 2019 · 90 posts · 122 votes
7y
@Jose Huijon you made a great first choice of looking to invest in real estate. With 10k you can do a few things depending on how creative you are.
BUT, the first move you should make is to do your homework about real estate investing fully before putting a dime into it. Bigger Pockets has so much to offer, read books, get into forums, listen podcasts/youtube, connect with people and learn from investors already successful in the game.
The first steps that any prospective real estate investor should take are 1. Goal Set and 2. Educate.
Goal Set
Why are you setting goals before you even know where or how to invest? Because without a clear path of where you want to be, you will never reach your goal. To be clear, your goal is what you want to get out of real estate, not what kind of portfolio you want to hold. Your goal should be fueled by your WHY, which is your motivation for investing in the first place. Some people want extra income for retirement, to fund religious missions, control over their investments, tax advantages, freedom from their job, funding for their kids’ future, etc. For me, my WHY is my family and community. My goal is financial freedom, where I can leave my job to spend more time with my wife, kids and educate our future generations on finance and money- something not taught in our schools today.
Defining your goal allows you to concentrate your education on what will help you achieve that goal. Without the clear direction, you will be learning about anything and everything real estate oriented, taking time and energy away from that which is most impactful. My goal demands achieving a high amount of cash flow over a short time period which means I may need to be more active in my investments, focus on value-add deals and utilize partnerships for larger projects. I know that if I come across turn-key projects, I don’t need to waste any time analyzing them, as they don’t fit my criteria. That being said, just because something doesn’t fit specific criterion doesn’t mean you can’t be creative and make a profit. Whatever you hope to achieve through real estate, defining your goal is the first step, as that will direct what types of investments you pursue.
Educate
This step may sound like a no brainer to some, but there are prospective investors believe real estate investing is a straight and narrow road with one clear path. Fortunately, it is not. There are countless ways to invest in real estate- residential buy & hold, flipping*, value-add (BRRRR), wholesaling*, commercial, hard money lending, development, land, tax liens, new construction, crowdfunding, mobile home parks, short-term rentals, etc. On top of these avenues for investment, there are endless ways to structure deals- partnering, owner financing, conventional financing, lease option, syndication, etc. On top of these avenues for structuring deals, there are many levers you can pull to make deals more favorable and provide higher returns.
There’s no one right RE investment vehicle for everyone, so I would be skeptical of anyone who told you where to put your money and time. You also don’t need to be an expert to start investing. When I suggest that you educate yourself before investing, it is so that you choose the right direction for you to achieve your goals. It’s my opinion that you don’t need to know the ins and outs of an investment before getting started, but you should at the very minimum understand at a high level how it works and the risks and benefits of that specific investment vehicle. I always recommend reading books, listening to podcasts and browsing forums posts of those who have already done what you’re trying to achieve. I am not a genius, so I would rather replicate than attempt to re-create the wheel.