How did you start in real estate investing

New to Real Estate · Minneapolis · Member since 2022 · 14 posts · 14 votes

Hi.

I'm new to real estate investing and trying to learn how to get my feet wet and get into this field.

I feel like from everything I read, I am not quite in the position to be as flexible with securing my first investment property (ie, married with some children, not wanting/interested in moving, etc).

Would like to hear how people did come up with the savings/money down to use to purchase your first investment property.

4 Reply

218 views

Most Popular Reply

Andrew Frowiss

Real Estate Agent · Austin, TX · Member since 2016 · 96 posts · 69 votes

Hi @Craig Ancier great question! I don't have a rental property, but I'm trying to get my first at the moment. This isn't the first deal I've done though. When I got into real estate I was an Agent with no experience, and I went right into wholesaling. I knew it was a way I could do deals with little to no money out of pocket so I got really good at finding motivated Sellers and getting deals under contract at good prices. I had some connections I made through networking at Investor meet ups who wanted deals, and had the funds to invest. When I found deals they would partner with me and either buy the deal from me and pay me a flat fee, or we would partner on the deal and I would see it through till the end. When I approached motivated Sellers I would give them the option of selling the home to me, or I could put it up on the market and get them full retail price for their home. It was nice to be able to have another option besides just buying the property with cash.

I ended up starting a property management company since most of my clients were investors buying rental properties in Austin, and now I primarily help other investors purchase their investments, and manage them.

I wish you the best of luck in your future endeavors!

2 Reply

See this reply in the discussion

40 Replies

Jump to latestLatest

Sort by

Ronnie Galindo
Realtor · Napa, CA · Member since 2018 · 112 posts · 77 votes
4y
Hey @Craig Ancier! Welcome to the wonderful and crazy world of REI. My wife and I initially got into REI by doing a live in flip. We bought a property stuck in the 80s and did a whole bunch of work to bring it into current times. That made us extreme equity in these last three years. After that I sold off my two cars I had and worked overtime to save up the first $25k that allowed me to buy my first flip (in TX). I then went on to bring in friends and family to buy the next few properties (they became down payment partners) but I would not recommend this if you do not have a solid team that you can rely on. It backfired on me and I ended up losing some money, which I will earn back in the end but made it very stressful.
It all depends on your situation. Could you come up with 10% down and buy in a market that is over 50 miles from you and use the vacation home loan? Could you hustle and work some overtime or get a side hustle to earn more income to get the full 20%? What are your goals? Cashflow? Appreciation? All these questions need to be thought of and talked about with your family to ensure everyone is on board and you all support one another. Good luck and if you have any further questions, just message me! I'd love to help!
1 Reply
Scott E.
Contractor · Scottsdale, AZ · Member since 2010 · 2k+ posts · 3k+ votes
4y
Everybody gets started a little different than the next person. I bought my first property with an FHA loan, and the real estate agent I hired offered to contribute some commissions to closing costs, which meant I was somewhere around $9k out of pocket to buy that first house.
That was almost my entire life savings at the time, but the home was recently remodeled and this was in 2011 so home prices were very deflated. Plus I wasn't married with kids, so I was comfortable taking the risk.
I found that owning my primary residence as my first "deal" was a really great way to get into real estate. When things went wrong around the house, I learned how to fix them. When things needed fixed that was outside of my scope, I learned to work with sub contractors. And when I wanted some extra monthly income, I brought in roommates and learned about leases. It was a very low stress way to get my feet wet.
1 Reply
Craig Ancier
OP
New to Real Estate · Minneapolis · Member since 2022 · 14 posts · 14 votes
4y
Thanks @Scott E. and @Ronnie Galindo. Appreciate your stories and insight.
1 Reply
Andrew Frowiss
Real Estate Agent · Austin, TX · Member since 2016 · 96 posts · 69 votes
4y
Hi @Craig Ancier great question! I don't have a rental property, but I'm trying to get my first at the moment. This isn't the first deal I've done though. When I got into real estate I was an Agent with no experience, and I went right into wholesaling. I knew it was a way I could do deals with little to no money out of pocket so I got really good at finding motivated Sellers and getting deals under contract at good prices. I had some connections I made through networking at Investor meet ups who wanted deals, and had the funds to invest. When I found deals they would partner with me and either buy the deal from me and pay me a flat fee, or we would partner on the deal and I would see it through till the end. When I approached motivated Sellers I would give them the option of selling the home to me, or I could put it up on the market and get them full retail price for their home. It was nice to be able to have another option besides just buying the property with cash.
I ended up starting a property management company since most of my clients were investors buying rental properties in Austin, and now I primarily help other investors purchase their investments, and manage them.
I wish you the best of luck in your future endeavors!
2 Reply
Corby GoadeBusiness Member
Investor · Boise, ID · Member since 2014 · 3k+ posts · 3k+ votes
4y
The real answer is that the easiest way to get in to investing is to house hack. You've already mentioned that you don't want to do that, but I'll tell you, I've done lots of things that I didn't want to do in my career. Lots of staying home for a weekend while my buddies went camping or to a BBQ. Spent money when it was scary, didn't listen to the "good advice" my friends and family gave me when I was trying to get started.
House hacking may not be for you, but every method involves risk, expense and discomfort. You don't get things worth having without discomfort- so, if you don't have stacks of cash sitting around, I'd suggest you revisit the idea of house hacking, least expensive, least risky, more immediate impact on your finances.
Regardless of how you get started, just start making moves! Good luck.
2 Reply
Craig Ancier
OP
New to Real Estate · Minneapolis · Member since 2022 · 14 posts · 14 votes
4y
@Andrew Frowiss and @Corby Goade, appreciate your thoughts and insights.
1 Reply
Richard Damian
Rental Property Investor · Houston, TX · Member since 2020 · 71 posts · 13 votes
4y
Craig , if you have money saved try a conventional loan ,20% down or if you have equity in your house , try a cash out loan , either way you can have cash to get started , then do alot of research in your area , rents , comps on house for sale , contractors , rehab costs , good luck !
0 Reply
Aaron Gordy
Real Estate Broker · Austin, TX · Member since 2012 · 1k+ posts · 1k+ votes
4y
zero down VA loan with a duplex for 80k while going to college. Sold it 20 years later for 440k.
1 Reply
Ali Boone
Real Estate Coach · Venice Beach, CA · Member since 2012 · 6k+ posts · 3k+ votes
4y
How many more hands-off options have you looked into? There are a lot of ways to invest without having to be hands-on. Syndications are a good one, REITs, etc. and then if you want actual property, you can go the turnkey route which isn't 100% hands-off, but it's a heck of a lot more doable when you don't have time to do things yourself. Lots of folks who work full-time jobs and have families go the turnkey route. And by turnkey, either going through a turnkey provider company, or if you're in Minneapolis, I'd imagine there are local cash flow options, so you could just focus on finding a property that's in good turnkey condition so it requires less work. Find a good investor-friendly agent to find you one.
0 Reply
Craig Ancier
OP
New to Real Estate · Minneapolis · Member since 2022 · 14 posts · 14 votes
4y
@Richard Damian, thank you. @Aaron Gordy, that's awesome (and thanks for your service:). @Ali Boone, thank you for this information, great ideas.
1 Reply
Julio GonzalezPro Member
Specialist · West Palm Beach, FL · Member since 2008 · 4k+ posts · 1k+ votes
4y
Glad to have you on the forums, Craig! You came to the right place for information!

561-253-6640
1 Reply
Paul Camuto
Real Estate Coach · Robbinsville, NJ · Member since 2017 · 185 posts · 99 votes
4y
Quote from @Craig Ancier:

Hi.

I'm new to real estate investing and trying to learn how to get my feet wet and get into this field.

I feel like from everything I read, I am not quite in the position to be as flexible with securing my first investment property (ie, married with some children, not wanting/interested in moving, etc).

Would like to hear how people did come up with the savings/money down to use to purchase your first investment property.
Save enough to buy your first place as a primary home. Rent it out. Save more buy another. Rinse and repeat. It is not as complicated as so many write about all the different theories and approaches. Just get started. Look for a property that is balanced between affordable and in a good area that has positive cash flow. If you cant afford the down payment or maintenance reserves then you are not ready.
1 Reply
Justin WindhamPro Member
Banker · Nationwide · Member since 2015 · 4k+ posts · 1k+ votes
4y
@Craig Ancier
It’s nice to have you here!

This is a great forum with very knowledgeable members that will help to guide you in the right direction.
There are a few self-contained guides that you can access here: https://www.biggerpockets.com/guides

I really like the alerts feature that can quickly guide you to current topics that might interest you: http://www.biggerpockets.com/alerts

0 Reply
Drew SygitBusiness Member
Property Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
4y
Bought a duplex while still renting a house-hack (roommates paid rent)
[email protected]248-209-6824
Logical Property Management4.9460 Reviews
Website View Page
0 Reply
Steven Foster Wilson
Rental Property Investor · Columbus, OH · Member since 2017 · 3k+ posts · 3k+ votes
4y
Quote from @Craig Ancier:

Hi.

I'm new to real estate investing and trying to learn how to get my feet wet and get into this field.

I feel like from everything I read, I am not quite in the position to be as flexible with securing my first investment property (ie, married with some children, not wanting/interested in moving, etc).

Would like to hear how people did come up with the savings/money down to use to purchase your first investment property.

Hi Craig,
When I got started investing my sophomore year of college, I had $500 to my name, My grandmother lent me $12k for the downpayment on a duplex on OSU campus in Columbus. Over the course of a year my wife and I fixed it up, rented to friends, ate peanut butter and jelly, did everything we could. We then refinanced the property and it has given us $140k in cash back and continually produces $1,800/month in cash flow.
Could you bring on a partner to be able to do your first deal?
1 Reply
Conner Olsen
Real Estate Agent · Austin, TX · Member since 2020 · 1k+ posts · 941 votes
4y
@Craig Ancier My wife and I purchased a duplex while she was pregnant with our first child. The duplex has great insulated walls so we can't hear anything from the other side. We have our own fenced in backyard and a nice patio area. It has worked well for us with our little family.
0 Reply
Craig Ancier
OP
New to Real Estate · Minneapolis · Member since 2022 · 14 posts · 14 votes
4y
@Julio Gonzalez, nice to be here. There definitely is a wealth of info on here! @Paul Camuto, appreciate the straightforward answer. @Justin wi

@Justin Windham, thank you! You are right, lot of knowledge here, for sure. Appreciate the resources. @Drew Sygit, seems a lot of people do that, I'm not currently in a place in my life to do that now, but wish I would have known this years ago :). @Steven Foster Wilson, Nice move! Could bring a partner in, but not too confident in myself yet in this field that I feel it would make it hard to find a partner. @Conner Olsen, wonderful!
Appreciate all the feedback from everybody.
2 Reply
Eliott Elias
Investor · Austin, TX · Member since 2021 · 9k+ posts · 5k+ votes
4y
More than the money and down payment you need to find the deals. Money can be found if you have the right deal, hard money lenders and private partners will partner with you if you find the deal. I would start focusing my energy on building relationships and finding deals
1 Reply
Jared HottleBusiness Member
Real Estate Agent · Cedar falls IA Waterloo, IA · Member since 2020 · 902 posts · 549 votes
4y

@Craig Ancier The more uncomfortable you are willing to be the quicker it goes I think. The easies thing would be to house hack a duplex and move into one side. It is possible to do real estate without doing something like this but will likely need 20% down so saving money or getting a 2nd job is a good way to save for the first one. (Also maybe hard with a family)
Beyond that there are ways to bring no money into deals by partnering with someone who has money. It is my firm belief that money will not be an issue if the deal is right. So maybe start driving for dollars or walking for dollars in neighborhoods that would be good rentals or that you like. look for houses in distress or long grass or multifamily and call the owners and see if they want to sell. Get good at running numbers using BP calculators and figure out what a good price would be. Tell everyone you know you are wanting to get into real estate. These are all things that do not cost money and maybe can do a little family bonding walking the neighborhoods and writing down addresses.
[email protected]319-288-5382
Jared Hottle Real Estate59 Reviews
Website View Page
0 Reply
Jaron WallingPro Member
Rental Property Investor · Indianapolis, IN · Member since 2018 · 4k+ posts · 4k+ votes
4y
@Craig Ancier I was hit by a car while cycling at 30 years old, had a wake up call, and realized how poorly I was handling my finances. After my recovery I did 12 months of market research (biked, drove neighborhoods, walked properties), and used some settlement money to buy a distressed property under market value. It was a live-in flip and now a cash-flowing rental.

Anything is possible when you apply valuable information to your own life. Don't take advice from broke people. Get information from experienced people that ACTUALLY OWN PROPERTIES> provide some value, let people talk, and don't try to reinvent the wheel.
0 Reply
Craig Ancier
OP
New to Real Estate · Minneapolis · Member since 2022 · 14 posts · 14 votes
4y
@Eliott Elias, @Jared Hottle...great advice.
0 Reply
Mike Klarman
Specialist · NJ · Member since 2022 · 1k+ posts · 653 votes
4y
Youtube has a wealth of videos about starting a real estate career with little to no money of your own invested. Some people start on the wholesaling side.
0 Reply
Alex BreshearsBusiness Member
Lender · Springfield, MO · Member since 2020 · 354 posts · 504 votes
4y
I had bit of an unconventional track to RE investing. I was at a local REIA meeting almost twenty years ago and got talking to some people. One of them was a private lender. He lent out his own capital to active investors. I got to see the "back side" of real estate investing through the eyes of the lender and what was really going on with projects. My boss was basically out on the golf course while I kept the office going with phone calls, faxes (this was awhile ago!) and borrowers coming in to make their payments. It sort of clicked for me right then and there that I really wanted to be on this side of the table versus the borrower side of the table. It was a lot less headaches! You could get started in private lending with your own capital, or brokering funds from those in your network. There is a bit to learn about it, but if you can underwrite a deal from a lender's perspective, you will definitely learn the ins and outs of residential real estate investing because you have to vet the deal to lend on it!
[email protected]Podcast Guest on Show #210
1 Reply
Craig Ancier
OP
New to Real Estate · Minneapolis · Member since 2022 · 14 posts · 14 votes
4y
@Jaron Walling, wow. that's an interesting start. Great insight. Thank you.

@Mike Klarman, thank you.@Alex Breshears, incredible start. I'm sure that was an invaluable experience.
1 Reply
Andrew SyriosPro Member
Moderator
Residential Real Estate Investor · Kansas City, MO · Member since 2014 · 10k+ posts · 5k+ votes
4y
Joined my dad's company after college as an employee, which makes my story a little unique and well, rather uninteresting.
Podcast Guest on Show #121
0 Reply

Join the conversationCreate a free account to reply, vote on answers and follow this thread.